Democratic Sentinel, Volume 19, Number 35, Rensselaer, Jasper County, 6 September 1895 — The Cause the Panic. [ARTICLE]

The Cause the Panic.

The chairman of the lowa Democratic state convention, which recently convened at Des Moines, set forth the true causes of thej panic in truthful language, when he said that with incr dible recklessness the republicans spent the large surplus of gold left by the Democratic administration, created no fund to redeem the silver money, though by the Sherman law they had bound the government to continue to buy monthly vast quantities of silver to b , put into circulation as token money. ‘‘The rest of the foreign holders of our securities, with confiderce already shaken by their losses in Argentina and Australia, beheld $600,000,000 of token silver money issu d, and not one cent provided for its redemption, and no fund available for that purpose except the $100,000,000 of gold designed for the redemption of greenbacks. They saw the silver mine o ivners and their followers working to force the country to a silver basis to increase the demand for their silver. They also saw a handsome surplus dissipated and exj enditures piling up which the country could not meet. They began to doubt the piwer or the will of the government to redeem its silver, and hurried their securities to New York to get gold while they could. Their example was followed by thousands of men in this country, who turned their securities and money into gold. They locked it up in safety deposit vaults, buried it in the ground, or hid it mol stockings. It went out of circulation and ceased to serve as money. The banks, crippled by the immense withdrawals, soon became shaky, some suspended. Alarm now became general, but it was no longer a question of getting gold from the banks, but a question of getting anytning at all. W hat had been apprehension was now become panic. It swept from the Atlantic to the Pacific, carrying

with it destruction of credit and paralysis of business, leaving bes bind it broken banks, deserted fao* tories and idle workmen. The greater part of the money of the country was withdrawn from circulation in a few weeks, and the sur> viving banks, fearful of more runs, dared not xend what little they had left, even to start the business of the country again. I recall with a shudder the summer of 1898. 1 saw the factories in which I am interested shut down and idle for months, and with banks forced to stop discounting paper, money co’d not be had to start them. Day after day I looked into the wisttul eyes of our men, as they asked with a duke in their voices, ‘‘When are are you going to startup?’*—and d y after day I had to say °£ can’t tell.” And I knew they had to go. home to their wives and children and give the same answer. In desperation I forgot that reason and panics never keep company, and went to several of the men in the county who had buried large sums of gold on tbeir|farms and tried to borrow from them. I offered repayment in gold, usurious rates of interest, any kind us se» ouiity that migbt be wished, including even a mortgage on my own home. Ifounlthat I could not borrow money if I owned the whole state of lowa to give as se* curity. My troubles and anxiety were light compared to many who saw not only the suffering of others but their own ruin. In the gloom of want and suffering, growing worse from day to day, I cursed the Sherman law—and 1 curse it now. It was a cowardly act and went hand in hand with a dishon i est one—the McKinley law, with its high texes and bounties. Its own authors distrusted it, but urged its passage to save the silvex states to the republican party and to buy votes for <he McKinley bih.”