Rensselaer Republican, Volume 24, Number 9, Rensselaer, Jasper County, 29 October 1891 — CURRENT COMMENT. [ARTICLE]

CURRENT COMMENT.

THE SEVEN "CONSPIRACIES.** ■ Some time ago it was discovered that the managers of the so-called People's party were circulating among: the farmers in Ohio pamphlets making attacks on the financial system of the country and indirectly on John Sherman for his part in financial legislation. One of these pamplets was placed in Senator Sherman s hands with a request that .he reply to the charges made. The Senator's reply was given out for publication on the 14th inst. and is as follows: THE LETTER. , Mansfield, Ohio. Oct. 12. Mr. Charles F. Stokey, Canton, Ohio — My Dear Sir: Yours of The Bth, acgfecoinpanied by Mr§. S. E. V. Emery's pamphlet called “Seven Financial Conspiracies Which Have Enslaved the American People,” is received. Sometime since this wild and vicious book was senj to-xnc. -and I read - itwitfibolhamusement and astonishment thfit any one could read it with approval or be deceived by its (falsehoods. ' The “seven financial conspiracies” fare the seven great pillars of our financial credit, the seven great financial measures by which the government was saved from the perils of war, and by which the United States has become the most flourishing and prosperous nation in the world. The first chapter attributes the -civil war to an infamous plot of capitalists to absorb the wealth of the country at the expense of the people when all the world knows that the civil war was organized by slaveholders to destroy the National Government and to set up a slaveholding confederacy in the South upon its ruins. The “Shylock" described by Mrs. Emery is a phantom of her im-

agination. The ' ‘Shy locks of the war" were the men who furnished the means to carry on the government and to put down the rebellion, and included in their number the most patriotic citizens of the Northern States, who, uniting their means with the services and sacrifices of our soldiers, put down the rebellion, abolished slavery, and preserved and strengthed our government. The first of her “conspiracies" she calls the exception clause in the act of Feb. 25, 1862, by which the duties

on imported goods were required to be paid in coin in order to provide the means to pay the interest on oiir bonds in coin. This clause had not only the cordial support of Secretary Chase, but of President Lincoln and proved to be the most important aid of the government devised during the war. Goods being imported upon coin -values, it was but right that the duty to the government should be paid in the Same coin. Otherwise ths duties would havp been constantly diminishing with the lessening purchasing power of our greenbacks. If the interest. of our debt had not been paid in coin we could have borrowed no money abroad, and the rate of interest, instead of diminishing as it did, tvould necessarily have had to be increased largely, 'and the volume of our paper money would necessarily have had to be increased and its market value would have gone down lower and lower.and probably ended, as Confederate money did, in being os worthless as rags. This exception tlause saved our public credit by making a market for our bonds, and was paid by foreigners for the privilege of entering our markets. As for the national banking system —the secund of her “conspiracies ’—it is taow conceded to have been the best form of paper money issued by banks that has ever been devised. It was organized to take the place of the State banks, which at the beginning of the war had outstanding over $200,000,000 of notes, of value carving from State to State, and most of it at a discount of from 5 to 25 per cent. It was absolutely necessary to get rid of these State bank notes and to substitute in their place the notes of banks which were secured beyond doubt by the deposit of United States bonds, a system so perfect that from thebeginning until now no one has lost a dollar on the cireulating notes of national banks. The system may have to give way because we are paying off our bonds, but no sensible man will ever propose in this country to go back to the old system of State banks, and if some security to take the place of United States bonds can be devised for National bank notes, the system will be and ought to lie perpetuated. The third “conspiracy ' referred to Is contraction of

THE CURRENCY. It has-been demonstrated by off. * rial documents that from the beginning of the war to this time the volume of our currency has been increasing year by year more rapidly than our population. In 1860 the total amount of all the money in circulation was $435,000,000, while our population was 31,000,000. and half of this was money of variable and changing value. Now we have in circulation $1,500,000,000 with a population of 64,000,000 and every dollar of this money is as good as gold, all kinds equal to each other, passing from hand to hand and paid out as good money not only in the United States but among all the commercial countries of the world. Our money has increased nearly four fold while our jpopulation has only doubled. The ■statements made by Mrs. Emery about the contraction of our currency are not only misleading but they are absolutely false. She states that in ,'IB6B $473,000,000 of money was destroyed and in 1869 $500,000,000 of our money passed into a cremation

furnace and in 1870 $67,000,000 was destroyed. Now these statements are absolutely false. What she calls money in these paragraphs was the most burdensome form of interstbearing securities, treasury notes bearing 7 3-10 per cent interest, and compound interest notes. These were the chief and most burdensome items of the public debt. They were paid off in the years named, and were never at any time for more than a single day money in circulation. When issued they were received as money, but as interest accrued they became investments, and were not at all in circulation. These statements of Mrs. Emery are palpable falsehoods, which if stated by a matt would justify a stronger word- It is true that in 1866 Mr. McCulloch. Secretary of the “Treasury under the administration of Andrew Johnson, wished to bring about resumption by contraction, and a bill was passed providing for a gradual reduction of the greenbacks to $300,000,000, but this was very soon arrested, and the greenbacks retained in circulation. I was not in favor of the contraction of thegreenbacks, and the very speech that she quotes in which I described the effects of contraction and the difficulty of resuming was made against the bill providing for the reduction of greenbacks. The next “conspiracy" to which she refers was the FIRST ACT OF GRANT’S ADMINISTRATION

“To strengthen the public credit. ” A controversy had existed whether the 5-20 bonds could be paid in greenbacks. I maintained and still believe that by a fair construction of the loan laws we had a right to pay the principal of the bonds as they matured in greenbacks of the kind and character in existence when the bonds were issued, but I insisted that it was the duty of the government to define a time when the greenbacks should be either redeemed or maintained at par in coin, that this was a plain obligation of honor and duty which rested upon the United States, and that it was not honorable or right to avail ourselves and our own negligence in restoring these notes to the specie standard in order to pay the bonds in the depreciated money. This idea is embodied in the credit strengthening act

The fifth “conspiracy" of what she calls “this infernal scheme” was the refunding of the national debt. This process of refunding is regarded by all intelligent statesmen as a measure of the highest value conducted with remarkable success. At the date of the passage of the refunding act, July 14, 1870, we had outstanding bonds bearing 5 and 6 per cent, interest for about $1,500,000,000. By the wise providence of Congress we had reserved the right of redeeming a portion of this debt within five years and a portion of it within ten years, so that the debt was in the main then redeemable at our pleasure. It was not possible to pay it in coin and it was not honorable to pay it in greenbacks, especially as that could only have been done by issuing new greenbacks far beyond the volume existing. during the war, and which w-ould at Once depreciate in value and destroy the public credit and dishonor the country. We therefore authorized the exchange, par for par, bonds bearing 4, 4} and 5 per cent, interest for the bonds bearing a highef rate of interest. The only contest in Congress upon the subject was whether the new bonds should run five, ten and fifteen years or ten, fifteen and thirty years. I advocated the shorter peripn. but the House of Representatives, believing that the new bonds would not sell at par unless running for a longer period, insisted that the 4 per cent, bonds should run for thirty years. Greenbackers like Mrs. Emery, who now complain that the bonds run so long and can not be paid until due, are the same people who insisted on making the bonds run thirty years. It required some ten years to complete these refunding operations—of which the larger part was accomplished when I was Secretary of the Treasury—and they resulted in a saving of one-third of the interest on the debt. So far from it being in the interest of the bondholders it was to their detriment and only in the interest of the people of the United States. The next “conspiracy” complained of is the alleged DEMONETIZATION OF SILVER. By the act revising the coinage in 1873 the silver dollar, which had been suspended by Jefferson in 1805 and practically demonetized in 1835 and suspended by minor coins in 1553, and which was issued only in later years as a convenient form in which to export silver, and the whole ! amount of which from the beginning of the government to the pass- ! age of the act referred to was only $8,000,000. This silver dollar was ; upon the petition of the Legislature of California and upon the motion of her Senators and by the unanimous vote of both houses pf Congress, ; without objection from any one, ‘ dropped from our coinage and in its ' place was substituted the trade dol- ! lar containing a’ few more grains of ; silver. A few ye&rs afterwards, sili ver having fallen rapidly in market I prices, Congress restored the coin. ■ age of the silver dollar, limiting the amount to not exceeding $4,000,000 I nor less than $2,000,000 a month,and I under this law in a period of twelve years we issued over 400,000,000 silver dollars, fifty times the amount which had been coined prior to 1873. And now under existing law we are purchasing 54,000,000 ounces of silver a year; so that what she calls the demonetization of silver has resulted

in its use in our country to an extent more than fiftyfold greater than before its demonetization. In spite of all, and growing out of the increased supply of silver and the cheapening process of its production, it is going down in the market and is only maintained at par with gold by the fiat of the different governments coining it. Now the deluded people belonging to the class of Mrs. Emery, are seeking to cheapen the purchasing power of the dollar in the hands of the farmer and laborer by the free coinoge of silver and the demonetization of gold. Silver and gold should be used add maintained as current money, but odly on a par with each other, and this can oftly be done by treating the cheaper metal as subsidiary and coining it only as demanded by the use of the people. The seventh “financial conspiracy” is the pride and boast of the government of the United States, the restoration of our notes long after the war was over to the standard of coin; in other words* the resumption of specie payments. This measure, which met the violent opposition of such wild theorists as Mrs. Emery, has demonstrated its success in the judgment of all intelligent people, not only in the United States, but in all the countries of the world. There is no standard for paper money except coin. The United States postponed too long the restoration of its notes to the coin standards. Since it had the courage to do this under the resumption act, on the Ist day of January, 1879, we have had in the United States a standard of gold with coins of silver, nickel and copper, maintained at that standard by the fiat of the government, and paper money in various forms, as United States notes,National bank notes, gold certificates, silver certificates, and Treasury notes all at par with gold. To call this a “conspiracy” or an “infamous plot” is a misnomer of terms which will not deceive any intelligent man, but it is rather the glory and pride of the people of the United States that it not only has been able in the past thirty years to put down a great rebellion and to abolish slavery, but to advance the credit of the United States to the highest rank among nations,to largely increase the currency of the country, to add enormously to all productive interests, and to develop the resources of the mine, the field, and the workshop to a degree unexampled in the history of nations. Intelligent people who reason and observe will not be deceived or misled Uy the wild fanaticism and the gloomy prophecies of Mrs. Emery. Temporary conditions growing out of the failure of any portion of our crops will not discourage them; the exaggerations of the morbid fancy will not mislead them. A candid examination of the great financial measures of the last thirty years will lead people to place what Mrs. Emery calls “the seven financial conspiracies” as the seven great wise and statesman-like steps which have led the people of the United States through perils and dangers rarely encountered by any nation, from a feeble confederacy with 4,000,000 of slaves and discordant theories of constitutional power, to a great, free republic made stronger by the dangers it has passed, a model and guide for the nations of the world.

As for Mrs. Emery’s criticisms upon me personally, I do not even deem them worthy of answer. She repeats the old story that I was interested in the First National Bank of New York and gave it the free use of the people’s a plain lie; contradicted and disproved over and over again. I never had the slightest interest in the bank, director indirect, and, as the public records will show, gave it no favors, but treated it like all other depositories of the public money and held it to the most rigid accountability; nor have I in any case derived the slightest pecuniary benefit from any measure either pending in or before Congress since I have been in public life. Very truly yours, John Sherman.

THE SOUTHERN CALL FOR PROTECTION. New York Press. The appeal as the Charleston News and Courier, in last Sunday’s Press, for the imposition of a duty on the finer qualities of imported cotton, was significant. It is not strange that the South, where manufacturing and agricultuaal industries are both making such strides, should join in asking for protection against foreign competition. Nevertheless, the South has been held so persistently as a free trade section that this evidence of a change of heart must be very disheartening to Northern free traders. It must be all the more encouraging because in this particular instance protection is asked fer a product that is what free traders call “raw material," but which has employed American labor in several phases to bring it from the seed, and is therefore raw material only in a modified degree. Northern Republicans have never begrudged protection to the industries which are regarded as peculiarly Southern. But members of Congress are supposed to be elected for the purpose of calling attention to the needs el their constituents, as well as legislating for the Nation at large. The trouble with Southern Democratic representation has been that they have* forgotten or neglected the material welfare of their respective districts in the zeal of their partisanship. If it is true that 120,000,000 that might as well have been expended in the South has gone to Egypt within a year for fine cotton, the Southern cotton planters should have their

reckoning with the men who fought' the McKinley law when they ought to have devoted their energies to saving that $20,000,000 for the people who elected them. Twenty millions is a big sum of money to present to the European creditors of the Egyptian Khedive. The Press can sincerely say that, believing that the interest of one part of the Union is the common interest of all, it earnestly wishes that the $20,000,000 in question was in the pockets of our fellow Americans of the South. BLAINE AND THE M'KINLEY BILL. John Hopley, editor of the Bucy - rus, Ohio Journal, having written to Mr. Blaine that the Democratic papers were parading the Secretary as an opponent of the McKinley bill; Mr. Blaine replies as follows, under date of Augusta, MO., Oct. 14: “My dear Sir —You inform me that the Democratic paper in your town and many Democratic papers throughout Ohio keep the following “But there is not a section or line in entire bill [McKinley tariff] that will open a market for another bushel of wheat or another barrel of pork.”—James G. Blaine to Senator Frye, July 11, 1890. “This sentence in garbled and taken from its proper connection. It creates a wrong impressiop. What I did say is the following: “I do not doubt that in many respects the tariff bill pending in the Senate is a just measure, and that most of its provisions are in accordance with the wise policy of protection, but there is not a section or a line in the entire bill that will open a market for another bushel of wheat or another barrel of pork.” “The letter in which this paragraph occurs was written to Senator Frye on July 11, 1890, and the McKinley bill did not become a law until October 1, nearly three months thereafter. In my letter to Senator Frye I objected to the bill because it did not contain a reciprocity clause, which would provide a market for wheat and pork, for other products of the farm and for various fabrics. Before the bill was finally passed the reciprocity clause was inserted and a large addition was made to the free list. It will therefore be seen, from what I said in my letter, that the objection which I had to the McKinley bill was entirely removed before the McKinley bill became a law. “Let me further say that the reciprocity clause has given ample market for many barrels of flour and many pounds of pork. “Brazil, some months since, entered into a treaty by which many American articles are admitted free. Flour is made free and pork is admitted at a nominal duty.

“Cuba and Porto Rico have reduced the duty on flour from $5.80 a barrel to $1 —which gives us the market—besides putting nearly one hundred articles of American production on the free list. “San Domingo has made a reciprocity treaty, with flour and pork upon the free list, besides a large number of other articles. Other treaties on reciprocity are in progress; “Germany, without negotiating a formal ‘ treaty, has removed the prohibition on pork, and our government in consideration thereof, has left her sugar on the free list. This opens to us an entirely new market, and $15,000,000 to $20,000,000 of American pork will be consumed per annum where not a pound has been taken for ten years. “The reciprocity provision is proving very succssful, especially in farm products, and more particularly in the case of the two articles mentioned—flour and pork. lam not therefore, an opponent of the McKinley bill, as the Democratic papers of Ohio are constantly alleging. On the contrary, I have constantly supported it ever since it was perfected by the insertion of the reciprocity clause, Very respectfully yours. James G. Blaine. Major McKinley in his speech at Circleville, 0., said: I assert, and I challenge contradic - tion from any quarter, that there is not a manufactured article in this country to-day that is manufactured by the American people under a protective tariff that has not been cheapened to the American consumer from 25 to 60 per cent. To such sitatements as this, backed up by irrefutable proofs, the freetrader only answers: “The tariff is a tax.”