People's Pilot, Volume 3, Number 36, Rensselaer, Jasper County, 23 February 1894 — A NEW FINANCIAL TEACHER. [ARTICLE]

A NEW FINANCIAL TEACHER.

Be la Smoked Oat by a Colorado Friend of Silver. Prof. Keasbey, of the university of Colorado, has an article in the Forum ! for January, explaining his view of the origin of the silver movement and how j it has secured such a hold on the south, j Prof. Keasbey’s educational associa- : tions have been such as to make him I “sound” on the coinage question, in the Wall street orthodox sense, and he has j thus far escaped the silver craze, which j is so deep-rooted in the west that it re- i minds him of the belief in religious I dogma in the early Middle ages—the period of the densest ignorance known to Christendom. “One hears it often said in the east,” this writer tells us, “that the silver problem is strictly a business problem, to be decided along strictly business lines, by strictly business men. As far as the west is concerned there never was a more fatal delusion. That allimportant question, whether gold has risen in value or silver has gradually falle*n in comparison with our staple l commodities, has. oddly enough, scarcely been considered by the western people.” They know as a fact, he tells us, that the price of silver expressed in gold has fallen and to them it has seemed self-evident that the depreciation has been caused by the diminished demand for silver because of its demonetization. Hence, we are told, from the true single gold standard view, that “little credence has been put in the converse theory, that the decline in the price of silver is due to the continual cheapening in its cost of production.” Prof. Keasbey traces the silver movement to the self-interest of the silver miner and to his ability, by plausible but fictitious reasoning, to impose upon the gullibility of the hard-working but innocent farmer. The latter finds himself in debt, br<s, the harder he labors and the more self-denial he exercises the greater the difficulty—or seeming difficulty— to get a decent living for his family and pay interest on the eastern mortgage. This condition becomes more and more "apparent as .the years pass and though the farmer discusses it. vigorously with his neighbors, it is beyond their comprehension. This perplexity last 3 until the silver miner comes along and realizing his inability to fight the money power of the east single handed, resolves at once “to enlighten his suffering brother and to draw him over to the cause of silver.” The miner assures the farmer that while he has been slaving on the praivies and enormously increasing the products of the United States, his eastern creditors have secretly stricken down one-half of the legal tender circulating medium granted by the fathers and have left “that particular half which has appreciated in value and which must in the future continuously appreciate in. value;” that while the productions and business of the country have been multiplying in volume, the medium for making exchanges has been so reduced that there is not half enough of money left to carry on legitimate business transactions. The farmer is told that as a consequence of the reduced currency what he sold some years ago for a dollar he must now sell for fifty cents; that although he toils much harder he grows no richer, while the eastern creditor not only holds his own but also secures the fruit oi the farmer's extra toil. The farmer is “far too shrewd at first to be caught in any circle of reasoning so palpably vicious as this.” Hut when he is reminded that he cannot pay the interest he owes the eastern creditor with “fifty-cent bits.” and that the creditor has not remitted the indebtedness one-half to correspond with the reduction in the value of the farmer’s labor or its products, the latter begins to see his relation to the silver question, or, to use the language of Prof. Keasbey, “a ray of light then began to pierce the darkness of, the farmer's understanding." Still he is a trifle incredulous as to the disinterestedness of his would-be ally in the cause of free coinage. He sees that its success would give the miner “a steady though fictitious price for his product. We are to support you in comparative idleness,” he tells the miner, “receiving in payment for three days’ labor by us an amount qf your silver at the old fictitious ratio, which will cost you but one day’s labor to extract.”. Finally the farmer is completely won over by the assurance that the miner will assist in augmenting the volume of the currency so that there will be sufficient to facilitate the business transactions made necessary by the productive and business developments of the last twenty years and so that farmers would receive profitable prices for what they have to sell and be able to release their homes from debt The farmer, obtuse to other forms of reasoning, surrenders to self-interest. The miner clinches his victory by statistical tables showing that the- decline in staple farm products for two decade, paralled the decline in silver, thus proving that silver has steadily maintained its relation to these commodities and that the divergence between the present and former values of silver an 1 gold has been .mainly due to the appreciation of the latter, because of legislation that has given it a monopoly as money of redemption—legislation which has greatly increased the demand for gold and correspondingly diminished the demand for silver. Self-interest has at last so unified the silver miners and the farmers of the west on this question that Prof Keas-: bey hardly thinks it worth while to ! puncture the logic of the westerner’s financial policy or prove his statistics to be fallacies and misleading, since it has now become a sectional force rather than an abstract question of finance. Admitting the soundness of ! the financial views of the east, he is j somewhat uneasy lest her apathy in ! the matter may have placed her in a critical position. There is danger of an alliance between the west and the south, the latter being yet undecided on the question, but the east is warned that for months past the west has had her emissaries bird at work drumming

np recruits for the cause of silver, using much the same arguments as were so successful in hoodwinking the ranchmen of the plains. “Before the south, too, becomes solid on the silver question, should not the east bestir herself? * * * To the east we must look for the wisest solution of the monetary problem,” is Prof. Keasbey’s conclusion. The professor’s theory of the rise of the money question as a political and possible sectional factor is not correct. The agitation commenced with the farmers and not with the silver miners. Farmers have for the past fifteen years, in their own organizations, discussed the effects of adverse silver legislation in contracting the currency and in- j augurating an era of falling prices; they produced able expositions on the . subject, incontestably tracing to that cause the cruel increase of the burdens ; placed upon them in augmented in- | debtedness, occasioned by lessening j the value of their labor and its prod- ! ucts, long before the miner figured in the discussion. The latter was not j heard from in a political way outside i of congress until the price of silver fell j to a point that materially interfered with the legitimate profits of mining— j which was not until within three years. ' Prof. Keasbey has a mistaken eoncep- ' tion of the western farmer, his charac- j ter and the measure of his intelligence. He is also wrong about the south. Sil- j ver and its relation to the money sup- i ply have been live questions in the south for a dozen years. On the test ' vote in the lower branch of congress • last summer ton southern states gave { congressional majorities for free coin- I age at the ratio of 16 to 1, and on that j question the southern people are far ; stronger than their representation in \ congress would indicate. The effect of cutting off the world’9 , supply of primary money by about one- < half, as outlined in the argument by , which the astute miner mystified and j imposed upoa the rather dull-witted j husbandman—as the issue is gauged by ! Prof. Keasbey*—is concurred in by the j most distinguished students of finance ! in the world, including the political I economists of greatest note in the edu- ; cational institutions of England. The ! fall in the price of commodities which ! has paralleled the period of silver's de- ! monetization is rightfully charged to ■ the enhancement of the unit of value ! and to the contraction of the medfutn ! of exchange resulting from the debase- I ment of silver. Prof. Fox well, of Uni- j versity college, London, places the ap- j preciation of gold at fifty per cent, and | is sustained in his estimate by very ! high authorities; while according to • the index numbers of Dr. Soetbeer and | Mr. Sauerbeck, exhibited at the Brus i sels conference, silver, despite increased i production, has depreciated scarcely any, measured by its relation to fiftyodd of the most useful commodities. The theory of over-production as an explanation for the fall in silver and for the disastrous general decline in the price of staple products is fallacious. The increased production of ] silver has not even kept pace with the j enormous expansion of commerce for ; the last twenty years, nor can there be ) such a thing as over-production of the j necessaries of life while millions in ! every nation of Christendom are not j more than half fed and are insuffi- \ ciently clothed and housed. The real ! trouble is under-consumption, due to j diminished purchasing power, and I when it is analyzed in the light of the ' science of political economy, as inter- j preted by its most illustrious expo- j nents, from Locke to Mill, it can be i traced only to a supply of money that is wholly inadequate to the requirements of business, having in view the general welfare and not merely the pecuniary interests of a class.—Denver News.