People's Pilot, Volume 4, Number 13, Rensselaer, Jasper County, 14 September 1894 — THE PRECIOUS METALS. [ARTICLE]

THE PRECIOUS METALS.

Gold and Silver Seem Designed by Nature as the Cifcnlating Medium of Mankind* It is saiu in the bullion report laid before the house of commons, England, June 10, 1810: “The most detailed knowledge of the actual trade of the country, combined with the profound science in all the principles of money and circulation, would not enable any man or set of men to adjus., and keep always adjusted the proportion of the circulating medium in a country to the wants of trade.” This problem can only be solved by resorting to nature’s treasury. It would seem that an allwise Providence has designated the two metals, gold and silver, as the circulating medium of mankind for the express purpose of accomplishing this object. During all the preceding centuries they have been money metals, and for this reason they have been known as “the precious metals.” The increase in their yield has never been simultaneous. The subsidence of one of them has been accompanied or followed by an increase of the other, and their joint product has been year by year enlarging and has never exceeded the wants of the commercial world.

During the excessive inflow of gold from the mines of California and Australia there was the same outcry against gold that there is now against silver, and the utter worthlessness of the yellow metal for monetary use in consequence of its impending superabundance was freely predicted. The German- states, including Austria, demonetised gold and adopted silver as their monetary standard in 1557. France was vehemently urged to also demonetize gold. But she did not listen to these appeals, but steadily pursued her course and had the satisfaction of witnessing the vivifying effects of this shower of gold upon her own industries and the industries of other nations.

It is the uniform testimony of history that no single agency has contributed so much to the prosperity and happiness of our race as the enlargement of the world’s money stock by the inflow of the precious metals from its mines. The gradual exhaustion of the ancient mines was accompanied by a corresponding decline in industrial and commercial activity, caused by a Steady and continuous fall in the values or prices of the products of industry. JDuring this period the volume of the world’s money stock, reckoned in our currency, fell from §1,800,000,000 to less than $300,000,000 and we are informed by Dr. Adam Smith that in the year 1455 the price of wheat in England was less than 3 pence per bushel. To this agency more than to any other is attributed by the historian Alison the settling* down upon Europe during the middle ages of the mantle of darkness which separates the civilization of the ancient from that of the modern world. Owing to an increase of its money stock from the treasury of the new world western Europe awoke from its profound lethargy and entered upon a career of industral prosperity and industrial activity it never knew before. Jevons says that from 1809 to 1849 gold rose in its relation to commodities “in the extraordinary ratio of 100 to 345, or by 145 percent., rendering government annuities and all fixed payments extending over this period about two and one-half times as valuable as they were in 1809.”

Of this period Alison in his history says: “If the circulation of the world had remained stationary or declining-, as it was from 1815 to 1810, from the effects of South American revolutions and English legislation, the necessary results 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, other articles measured in money less so, and debts and taxes would have been constantly increasing in weight and oppression. The fate that crushed Rome in ancient and 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 treasuries of California and Australia.

Mr. Hunter, chairman of the finance committee of the senate, in presenting to that body in 1852 a measure for changing the ratio in respect to our minor silver coins, by reducing the weight of pure silver in them about 8 per cent, in order that they might be kept here, and not melted down and sent abroad, said in his report: “Of all the great effects produced upon human society by*- the discovery of America, there were probably none so marked as those brought about by the great influx of the precious metals from the new world to the old. European industry had been declining under the decreasing stock of the precious metals and an appreciating standard of value. Human industry had grown dull under the paralyzing influences of declining profits and capital absorbed nearly all that should have been divided between it and labor. But an increase of the precious metals in such quantity as to check this tendency operated as a new motive power to the machinery of commerce.

“Production was stimulated by finding the advantages of a change in the standard upon its side. Instead of being repressed by having to pay more than it had Stipulated for the use of capital it was stimulated by paying less. Capital, too, was benefitted, for new demands were created for it by the new uses which a general movement in industrial pursuits had developed; so that if it lost a little by a change in the standard it gained much more in 'the greater demand for its use. which added to its capacities for reproduction and its real value.” He denounced the adoption of either one of the metals alone, saying: “The mischief would be great, indeed, if all the world were to adopt but one of the precious metals as the standard of value. To a lopt gold alone would diminish the specie currency more than

one-half, and the reduction the other way, should silver be taken as the only standard, would be large enough to prove highly disastrous to the human race.” —Henry G. Miller, in Chicago Times.