The Writings of Carl Schurz/Honest Money and Honesty

by Carl Schurz and others

 

HONEST MONEY AND HONESTY^[1]

Fellow-Citizens:—I have come from the East to the West to speak to you for honest money. I do not imagine myself to be in an “enemy's country.” There is to me no enemy's country within the boundaries of this Republic. Wherever I am among Americans I am among fellow-citizens and friends, bound together by common interests and a common patriotism. In this spirit I shall discuss the question of the day. I shall not deal in financial philosophy, but in hard and dry facts.

There are sporadic discontents in the country, partly genuine, partly produced by artificial agitation. They may be specified thus: There are farmers who complain of the low prices of agricultural products; laboring men complaining of a lack of remunerative employment; men in all sorts of pursuits complaining of a general business stagnation and of a scarcity of money. In some parts of the country, especially the South and West, there are many people complaining of a want of capital and a too high rate of interest. The cry for more money is the favorite cry. These are the principal and the most definite complaints. Beyond them, however, an impression has been spread by agitators that an organized conspiracy of moneyed men, mainly great bankers, in America and in Europe, backed by the monarchs and aristocracies of the old world, is seeking the general establishment of the gold standard of value to monopolize or “corner” the world's money to the general detriment. All this has found definite expression in the following declaration of the Chicago platform:

We declare that the act of 1873, demonetizing silver without the knowledge or approval of the American people, has resulted in the appreciation of gold and a corresponding fall in the prices of commodities produced by the people; a heavy increase in the burden of taxation and of all debts, public and private; the enrichment of the money-lending class at home and abroad, prostration of industry and impoverishment of the people.

Mark well that all these evil consequences are ascribed to the demonetization of silver in the United States alone—not to its demonetization anywhere else. This is to justify the presentation, as a sufficient remedy, of the free coinage of silver in the United States alone, “without waiting for the aid or consent of any other nation.” This platform is amplified by free-coinage orators, who tell us that the act of 1873, called “the crime of 1873,” has surreptitiously “wiped out” one-half of the people's money, namely, silver; that in consequence the remaining half of our metallic money, namely, gold, as a basis of the whole financial structure, has to do the same business that formerly was done by gold and silver together; that thereby gold has risen to about double its former purchasing power, the gold dollar being virtually a 200-cent dollar; that the man who produces things for sale is thus being robbed of half the price, while debts payable on the gold basis have become twice as heavy, and that this fall of prices and increase of burdens are enriching the money changers and oppressing the people.

Are these complaints well founded? Look at facts which nobody disputes. That there has been a considerable fall in the prices of many articles since 1873 is certainly true. But was this fall caused by the so-called demonetization of silver through the act of 1873? Now, not to speak of other periods of our history, such as the period from 1846 to 1851, everybody knows that there was a considerable fall of prices, not only as to agricultural products—cotton, for instance, dropped from $1.00 a pound in 1864 to 17 cents in 1871—but in many kinds of industrial products, before 1873. What happened before 1873 cannot have been caused by what happened in 1873. This is clear. The shrinkage after 1873 may, therefore, have been caused by something else.

Another thing is equally clear. Whenever a change in the prices of commodities is caused by a change in supply or demand, or both, then it may affect different articles differently. Thus wheat may rise in price, the supply being proportionately short, while at the same time cotton may decline in price, the supply being proportionately abundant. But when a change of prices takes place in consequence of a great change in the purchasing power of the money of the country, especially when that change is sudden, then the effect must be equal, or at least approximately so, as to all articles that are bought or sold with that money. If by the so-called demonetization of silver in 1873 the gold dollar, or the dollar on the gold basis, became a 200-cent dollar at all, then it became a 200-cent dollar at once and for everything. It could not possibly be at the same time a 200-cent dollar for wheat and a 120-cent dollar for coal, and a 150-cent dollar for cotton, and a 100-cent dollar for corn or for shovels. I challenge any one to gainsay this.

Now for the facts. The act of 1873 in question became a law on the 12th of February. What was the effect? Wheat, rye, oats and corn rose above the price of 1872, while cotton declined. In 1874 wheat dropped a little; corn made a jump upward; cotton declined; oats and rye rose. In 1875 there was a general decline. In 1876 there was a rise in wheat and a decline in corn, oats, rye and cotton. In 1877 there was another rise in wheat carrying the price above that of 1870 and up to that of 1871, years preceding the act of 1873. Evidently so far the 200-cent dollar had not made its mark at all. But I will admit the possible plea, that, as they say, the act of 1873 having been passed in secret, people did not know anything about it, and prices remained measurably steady, in ignorance of what dreadful things had happened. If so, then it would appear that, if the knowing ones had only kept still about it, the gold dollar would have modestly remained a 100-cent dollar, and nobody would have been hurt. But, seriously speaking, it may be said that when the act of 1873 was passed we were still using exclusively paper money; that neither gold nor silver was in circulation, and that therefore the demonetization would not be felt. Very well. But then in 1879 specie payments were resumed. Metallic money circulated again. And, more than that, the cry about “the crime of 1873” resounded in Congress and in the country. Then at last the 200-cent gold dollar had its opportunity. Prices could no longer plead ignorance. What happened? In 1880 wheat rose above the price of 1879, likewise corn, cotton and oats. In 1881 wheat rose again, also corn, oats and cotton. In 1882 wheat and cotton declined, while corn and oats rose. The reports here given are those of the New York market. They may vary somewhat from the reports of farm prices, but they present the rises and declines of prices with substantial correctness.

These facts prove conclusively to every sane mind that for nine years after the act of 1873—six years before and three years after the resumption of specie payments—the prices of the agricultural staples mentioned, being in most instances considerably above 1860, show absolutely no trace of any such effect as would have been produced upon them had a great and sudden change in the purchasing power of the money of the country taken place; that it would be childish to pretend that but for the act of 1873 those prices would be 100, or 50, or 25, or 10 per cent. higher, and that, therefore, all this talk about the gold dollar having become a 200-cent dollar, or a 150-cent dollar, or 125-cent dollar, is—pardon the expression—arrant nonsense. Since 1882 the price of wheat has, indeed, very much declined, although in 1891 it reached once more in New York $1.09, while corn sold in 1891 2, 3 and 4 cents higher than in 1879. But if the act of 1873, which, had it really enhanced the purchasing power of the dollar, would have done so promptly and uniformly, produced no such effect for nine years after its enactment, it would be absurd to say that it produces it twenty years after its enactment. Is not this clear?

If, however, there be somebody believing that in spite of these facts the demonetization of silver by the act of 1873 must in some mysterious way have done something to depress prices, I meet him with the affirmation that the silver dollar was practically demonetized long before 1873. To judge from the speeches of our free-coinage orators the American people must before 1873 have fairly wallowed in silver dollars. What is the fact? President Jefferson stopped the coinage of silver dollars in 1806. From 1783 to 1878, aside from fractional currency—which since 1853 was only limited legal tender—only about 8,000,000 of silver dollars were coined. They were so scarce that you would hardly ever see one except in a curiosity shop as a rare coin.

There was constant trouble with the legal ratio between gold and silver, which could not be so fixed as to keep the two metals together in circulation. First one of them would be driven out of the country and then the other. Meanwhile, over $1,000,000,000 of gold coin was coined, and since 1853 gold was substantially the only full legal-tender money in actual circulation. And those were exceptionally prosperous times. Then the civil war came and swept all our metallic money out of sight. Paper money took its place, and in that condition we were in 1873, when the famous act of 1873 was passed. What, then, was in reality that law that has since been so fiercely denounced as “the crime of 1873”? To judge by the declamations of the free-coinage orators, it must have been a law annihilating at one fell swoop one-half of the money circulating among the people. Did it do that? Why, it was simply an act revising our coinage laws and providing among other things that certain silver coins should be struck to be legal-tender in the payment of debts only to a small amount. The standard silver dollar, that had practically been out of use since President Jefferson in 1806 had stopped its coinage, was simply not mentioned in the enumeration. That is all. The act of 1873, therefore, did not create a new state of things, but simply recognized a state of things which had existed for many and many years. It did thereby not only not destroy half the money of the country, but not a single dollar of it.

But, I hear myself asked, if this is so, why was this act of 1873 passed secretly, surreptitiously, stealthily? For silver orators have been persistently dinning into the popular ear for many years, until millions believed it, the story that the silver dollar was “assassinated” through the law of 1873 by some dark, corrupt plot. This fable has been so often and so authoritatively disproved that I am unwilling to take it up again in detail. Senator Sherman did that recently in a most conclusive manner. I will only add that I was a member of the Senate at the time and know whereof I affirm; and I emphatically pronounce all the stories about the act of 1873 being passed surreptitiously; about Senators and Members being somehow hypnotized, so that they did not know what they were doing; about some Englishman being on the ground with much money to promote the demonetization of silver, and so on, as wholly and unqualifiedly false. I wish to be scrupulously courteous to my opponents. But as a conscientious student of contemporaneous history, I am bound to say that in the forty years during which I have been an attentive observer of public affairs, I have never witnessed nor heard of such unscrupulous, shameless, persistent, audacious, cumulative, gigantic lying as has been and is now being done with regard to the act of 1873, its origin, its nature and its consequences.

How did it happen that the act of 1873 did not attract more popular attention at the time? Simply because the dropping of the obsolete silver dollar from the coinage was regarded by everybody taking an interest in such matters as the mere recording of an accomplished fact, as a matter of course, just as much so as a law would have been providing that the old flintlock should no longer be used in the army. And how did it happen that a few years afterward such an uproar arose about it? The reason for that, too, was very simple. In 1873 the market value of silver, although already yielding, was still high. The silver in the silver dollar was worth $1.02. The silver-mine owner did not care to take $1.02 to the mint and get only $1.00 back for it. He was then enthusiastic for gold. But a few years later silver had declined in market value considerably, and when the silver miner might have taken 90 cents worth of silver to the mint and got for it $1.00, he was enthusiastic for silver, and he grew more and more enthusiastic the more silver declined in the market and the more profit free coinage would have given him. The silver-mine owner is no doubt a great and good man, but he is not the most disinterested of philanthropists. He knows on which side his bread is buttered. Finding the act of 1873 in his way, he discovered that act to have been a heinous crime, not against the mining millionaires, but against the common people. Another class of persons joined in the cry, namely, those who had worked for an inflation of our irredeemable paper money, who had opposed the resumption of specie payments and now favored the silver dollar, because the silver in it was worth in the market less than a gold dollar, and its coinage would therefore furnish what they called “cheap money.” And then began that campaign of falsehood which in shamelessness of imposture has, within my knowledge, never had its equal.

Now mark what followed. Cowed by the uproarious outcry which was started by the silver miners and taken up by the “cheap money” men, Congress passed two laws, one in 1878, the other in 1890, in pursuance of which over 429,000,000 of silver dollars were added to our currency, more than fifty times as many dollars as had ever been coined before, besides a large addition to our subsidiary silver coins. Our paper money was largely increased, so that while in 1873, the year in which the American people were said to have been robbed of half their money—while in 1873, I say, we had $774,000,000 of money in the United States, we had $2,217,000,000 in 1895—nearly three times as much; and while in 1873 the circulation was $18.04 per capita, it was $22.96 per capita in 1895. Fifty times as many silver dollars, and many times more money of all kinds than this country had ever had in its most prosperous days—and yet, the price of silver in the market kept on falling, and the prices of many commodities, agricultural staples included, continued in their declining tendency.

Now analyze this case. Upon what ground do the silver advocates assert that the so-called demonetization of silver depressed prices? According to their own reasoning, because there has not been sufficient money to sustain prices. Sustain what prices? Those prevailing before 1873. But there is now three times as much money as there was in 1873, and a much higher per capita circulation. Well, what becomes of their argument? Some of the silver philosophers have invented a more mysterious phrase—that prices have gone down because by the act of 1873 the “money of ultimate redemption” had been curtailed—only gold being available for this purpose. But according to the treasury statistics we had in 1873 only $25,000,000 of coin, including subsidiary silver, in the country, and now we have much over $600,000,000 of gold alone, or more than twenty-four times as much “money of ultimate redemption” as in 1873. And yet prices are low. The man whom such facts do not convince that the decline of prices cannot have been caused by any effect produced upon our currency by the act of 1873 must have a skull so thick that a trip hammer would not drive a sound conclusion through it.

But what is it, then, that has caused the decline of prices? I appeal to your common-sense. Do you think that when one man, aided by machinery, does as much productive work as formerly ten or more did, and when our modern means of transportation carry the product from the producer to the consumer with five times the speed, at one-fifth the cost, and when in the transmission of intelligence time is quite and cost almost annihilated, do you think that then the product of human labor should not in due proportion become cheaper? If it did not, then modern civilization would, in one of its most important and beneficent functions, be a flat failure. For what is the inventive genius of the age that devotes itself to practical objects engaged in; what else than in devising and developing means and methods by which the things required by mankind for the sustenance and comfort of life be made better and more easily attainable; that is, cheaper?

The farmer in the United States welcomed the agricultural machinery which helps him in planting, raising and harvesting his crop. He welcomed the railroad, the steamboat, the low freights, the telegraph, which shortened the distance between his farm and the market, and the banking arrangements required for moving and selling his product. But as nearly all our farmers had the same encouragement, so it followed quite naturally that the wheat crop of this country increased from an annual average of 312,000,000 bushels between 1870 and 1880 to an annual average of 475,000,000 bushels between 1890 and 1895. But also foreign countries had the encouraging benefit. New wheat fields were opened in Russia and the Argentine Republic and elsewhere; and, according to Bradstreet's (a very competent authority), the wheat product of the world grew from 1889 to 1894 no less than 429,000,000 bushels, while the world's consumption is estimated to increase only 12,000,000 to 16,000,000 bushels annually. When the increase of the world's supply thus gains upon the increase of the world's demands is it a wonder that in the world's market, which rules the price for all exporting countries, prices should have declined? Is not this an infinitely more rational explanation of the decline in prices than to ascribe that decline to the so-called demonetization law of 1873, which practically demonetized nothing, but was actually followed by an increase of our currency, nearly trebling its volume, and making the per capita far, far higher than it ever had been before, and higher than it is in any other country except one? You might as well ascribe our civil war to the great comet of 1811.

Permit me here a word on what, in my humble opinion, is the true source of the discontent so far as it is entertained by honest men. The new economic conditions somewhat suddenly created in our time by the vast improvements in the means and methods of production and transportation have surprised, puzzled and perplexed the minds of many well-meaning people. They became alarmed at the naturally and necessarily following decline of the prices of agricultural as well as industrial products and at the general tendency of profits toward a minimum. Some of them found it very hard to adapt their ways of thinking and doing to the new state of things. They disliked to see in all the change a natural evolution of permanent effect. They easily yielded to the impression that there must be something wrong at the bottom of it all, some conspiracy of wealth, some hocus-pocus with the money of the country, just as once every cattle disease was ascribed to witchcraft, and as even in this century in some places the appearance of cholera was attributed to a conspiracy of the Jews to poison the wells. Honest people in that state of mind fell an easy prey to the equally honest financial quack as well as to the dishonest demagogue. Thus they were readily persuaded that the so-called demonetization of silver was the true cause of their troubles, and that the free coinage of silver would be the true remedy, while thorough inquiry and calm reasoning would have convinced them that the true cause is the progress of civilization in production and transportation, and that the true remedy can be found only in the adaptation of our schemes of husbandry and our business methods to that progress. This is proved by actual experience. There are a great many prosperous farmers to-day in spite of low prices. They are farming farmers. There are others who do not prosper. They are largely the political farmers. The reason is this: The successful farming farmers have been studying the most economical methods of production, the most profitable varieties of farm products and the changing opportunities offered by the market, while the political farmers have studied Coin's Financial School and the question how free coinage would give them double prices for what they would have raised if their financial studies had not absorbed so much of their time and attention.

Candid reflection will convince them that the remedy urged by the free-coinage men, being based upon a false diagnosis, will not only not cure but immensely aggravate the trouble complained of. It is a case of jumping from the frying-pan into the fire. The Bryan remedy demands a radical change of the basis of our monetary system. What is that system? The currency of the United States consists of gold coin, silver coin and five different kinds of paper money, these all redeemable in gold or in some roundabout way sustained by gold. Besides, there is the national bank currency, redeemable by the banks in greenbacks, the greenbacks then being redeemable in gold. It is true, nominally, various descriptions of our paper money, the greenbacks and the Treasury notes, are redeemable in “coin,” meaning, literally, gold or silver, at the discretion of the Government, but practically they have always been held to be redeemable in gold if the holder presenting them for redemption so desired. And this construction has been substantially confirmed by the law of 1890. That law directed the purchase of 4,500,000 ounces of silver a month and the issue of Treasury notes therefor, such Treasury notes to be redeemable in gold or silver coin; and in connection therewith the law declared it to be “the established policy of the United States to maintain the two metals at a parity with each other, upon the present legal ratio, or such ratio as may be provided by law.”

Fix your minds upon these words. We wish the United States to be regarded as an honest and honorable nation. If so, then this declaration made through its Government must be regarded as an honest declaration. This declaration could honestly have but one meaning, namely, this: The Government said,

Here, I issue paper money to be redeemable in gold or silver coin at my discretion, but lest anybody be disturbed by doubt as to the mercantile value of one of these metals, I hereby solemnly declare it to be my established policy to maintain these two metals at a parity, that is, equal to the more valuable of the two. You can therefore take my paper money with full confidence in my honor and integrity.

I repeat, if ours is an honest and honorable Government, the declaration could not possibly have any other meaning. I therefore affirm and maintain that it constituted a clear and solemn pledge on the part of the United States to keep the silver dollar in its purchasing power as good as the gold dollar, and to do all things that might be necessary to that end. Whoever denies this meaning of the declaration pronounces the United States a cheat, a “confidence” concern, issuing promises to pay, under false pretenses.

How is the Government of the United States to make good that pledge? It would be an easy task, indeed, if the silver contained in the silver dollar were in the market, as merchandise, worth as much as the gold contained in the gold dollar. But, for reasons which I shall mention hereafter, the market value of silver has fallen about 50 per cent., so that the silver contained in the silver dollar can be bought in the market, as merchandise, for little more than 50 cents in gold. What is the problem confronting the Government now? Some financial philosophers of the fiat persuasion say that when the Government put its stamp upon the silver dollar, and made it a legal-tender, it created in it a value as good as that of the gold dollar, and its duty is fulfilled, once and forever. Is this true?

Soon after the beginning of our civil war the Government issued the greenback. The greenback dollar was a bit of paper on which was printed the promise of the Government to pay the holder one dollar—meaning one dollar in gold coin, for nobody thought of anything else. It bore the Government stamp and was made a legal-tender for public and private dues, except duties on imports. At first, when there were but few greenbacks out, and it was hoped that the war would speedily be ended and the Government would soon be in condition to redeem the greenback, that greenback passed at par with gold, in spite of its not being receivable for duties on imports. But as the war continued and the quantity of greenbacks grew larger and larger, the public confidence as to the Government soon becoming able to redeem them was shaken, and the greenback, in spite of the Government stamp and its legal-tender qualities, fell in purchasing power compared with gold. Gold rose to a premium as against the greenback and went out of circulation. This gold premium rose and rose as the quantity of greenbacks out increased, and at the same time the period when the Government would be able to redeem them seemed farther removed.

But the civil war came to a happy ending, the issuing of greenbacks was stopped, the redemption act was passed, the Government gathered gold and the greenback rose to par with gold again. The stamp of the Government and the legal-tender quality had neither saved it from depreciation nor secured its return to par with gold. What caused the depreciation was the prospect of an indefinite increase of the greenback promises to pay and the uncertainty as to the ability of the Government to meet its obligations. What caused the subsequent rise of the greenbacks to par with gold was the limiting of the greenback issues to a manageable quantity, the preparation made by the Government for redemption and the returned public confidence that the Government was able as well as willing to redeem its promises.

What is now the status of the silver dollar in this respect? The greenback dollar is an evidence of indebtedness on the part of the Government to the amount of just $1.00—the bit of paper out of which the greenback is made being worth nothing. Under the pledge of the Government to keep the silver dollar to all intents and purposes on a parity with the gold dollar, the silver dollar is virtually an evidence of indebtedness on the part of the United States to an amount equal to the difference between the mercantile value of the metal in the silver dollar and in the gold dollar, that is to say, to the amount of 50 cents if the metal in the silver dollar can be bought at 50 cents. Notwithstanding this difference, the silver dollar will, like the greenback, pass in mercantile transactions as the equivalent of the gold dollar as long as there is public confidence in the ability and willingness of the Government to fulfil its pledge to “maintain the two metals at a parity.” To fulfil this pledge it is necessary so to limit the circulation of silver dollars and of paper representing silver, for which the Government is responsible, and to keep so large a reserve of gold on hand, as to leave no reasonable doubt of the ability of the Government to meet its obligations.

We know from experience that when, as in 1893, such doubt arose, gold was withdrawn from the Treasury in large quantities, and the gold dollar was on the point of rising to a premium—that is to say, the parity of the two metals was being disturbed. It could be, as it was, maintained only by stopping the increase of the silver circulation and by replenishing the gold reserve by means of bond sales. Had the Government neglected to take these necessary steps, had it permitted the parity of the two metals to be disturbed, it would have been false to its manifest duty, a duty which President Cleveland faithfully, courageously fulfilled. There stands, then, the National pledge to keep the purchasing power of the silver dollar within the United States equal to that of the gold dollar. Every Government policy disregarding that pledge or making its fulfilment impossible is a policy of downright repudiation, dishonoring the Republic.

What, then, is the policy of the Bryan democracy? It is expressed in its platform: “We demand the free and unlimited coinage of both silver and gold at the present legal ratio of 16 to 1, without waiting for the aid or consent of any other nation.” And, secondly, “We are opposed to the issue of interest-bearing bonds of the United States in times of peace.” What does the free coinage of silver mean? It means that any one, here or abroad, who has any silver of any kind may take it to the mints of the United States to be coined into dollars without charge, and that the silver dollars so coined shall be returned to him and shall be a legal-tender for all debts, public or private. And what does the ratio of 16 to 1 mean? It means that under the law sixteen ounces of silver shall be held to be worth one ounce of gold. But are sixteen ounces of silver to-day worth one ounce of gold in the markets of the world? Why, there is not a sane person in the United States or anywhere else who would to-day give one ounce of gold for sixteen ounces of silver, knowing that he can get more than thirty-one ounces of silver for one ounce of gold. What, then, would free silver coinage mean if suddenly introduced to-day? It would mean that any one, American or foreigner, could at pleasure expand our silver currency and thereby increase our public obligation by taking to our mints silver bullion worth about 50 cents and getting back a silver dollar worth about twice as much in its debt-paying power.

This would, no doubt, be a profitable arrangement for those who have silver to take to the mint. Who are they? To judge from the talk of silver orators you might think that, if only free coinage were once established, every farmer would have his private silver mine in his back yard and every laborer a magic source of silver supply in his kitchen. Such delusions would soon vanish. It would turn out that the men who would have large quantities of silver bullion to be doubled in value are the rich mine owners, the silver kings, who belong to the heaviest capitalists in the country, and the bullion dealers, the great brokers, the big money-changers, here as well as in England and on the European continent—in short, what Populists usually call the “money power.” How large the rush of silver to our mints and the consequent addition to our silver coinage would be, I will not here conjecture. It is, indeed, certain that the inducement of any great profit would very soon disappear. But in any event there will be an indeterminable, indefinite expansion of our silver circulation in prospect, and I maintain that this indefinite prospect of expansion would utterly destroy the parity of the two metals.

It is true some of the free-coinage men reason “that free coinage would increase the demand so as to restore the old price.” Let us see. The act of 1873, as has been shown, did not curtail existing demand, for there had been no such demand in this country for many years. The demonetization of silver in the old world did curtail the demand, but it was far from being the only cause of the fall in the price of silver. The price of silver began to decline in the market, at first slightly, two years before the demonetization took place. The cause was, then, the increase of supply. Between 1866 and 1870 the average annual production of silver in the world was 43,051,583 fine ounces. Between 1871 and 1875 it was 63,317,014 fine ounces, and it went on increasing until in 1895 it was 174,796,875 fine ounces, four times as much as the annual average had been thirty years before. And the rise in production would have been still greater had not the fall in price made the mining of some low-grade ores unprofitable.

Now I ask any sensible person whether against such an increase of production any product in the world could have maintained its price, even if the demand had remained the same. What, then, would the effect of free coinage in the United States be on the price of silver? It would probably produce at first an upward tendency. But as soon as the price goes up, silver production, greatly facilitated by constantly progressive reduction of its cost, will jump up too, and once more depress the price. We had a striking illustration of this after the passage of the law of 1890, which provided for the purchase of 54,000,000 ounces annually. At first the price of silver rose sharply, but soon it began to fall again, and fell lower than ever. Why? Because the production of silver rose from 124,000,000 ounces in 1890 to 137,000,000 in 1891, to 153,000,000 in 1892, and to 165,000,000 in 1893. Can there be any doubt that, if free coinage caused any considerable rise in price, that price would be speedily pressed down again by an increased output of the mines? Why is it that such an enormous quantity of silver is produced at the present low price? Because at that low price silver mining on a large scale is still profitable. If it were not there would be none of it. It is therefore certain that free coinage would not raise the price of silver to anything near the old figure, and that an ounce of gold would continue to buy far more than sixteen ounces of silver.

How, then, could under such circumstances the parity of the two metals be maintained with an indefinite increase of the silver circulation? It would be impossible, unless the gold reserve behind all our obligations were also indefinitely augmented? And how could that reserve be augmented? As it may appear, only by loans effected through the issue of bonds of the United States. But here the Bryan democracy steps in with its platform declaring, “We are opposed to the issuing of interest-bearing bonds of the United States in times of peace.” Thus by making the increase of the silver circulation indefinite and at the same time stopping the only source from which the gold reserve can be replenished, the Bryan democracy will render the maintenance of the parity of the two metals utterly impossible. This is a clear repudiation of the solemn pledge contained in the law of 1890, with more acts of repudiation to follow.

Consider now what the immediate consequences would be if Mr. Bryan were elected President, with a Congress to match. Mr. Bryan would of course be anxious to have his free-coinage law enacted, but that could not be, even if he called an extra session of Congress, until some time in April or May, five or six months after the day of election. But as soon as on the 4th of November the results of the election were announced everybody would know that the parity of gold and silver would not be maintained. Even Mr. Cleveland would not be able to maintain it till the expiration of his term, for nobody would then buy bonds for gold, expecting them to be paid back in silver. Neither would the banks of the country, as they have recently done, come forward again to supply the Treasury with gold, for they would have to expect that the greenbacks they would get for the gold would be redeemed in silver. And here permit me a word, by the way, about those banks. Some of the silver papers said that the banks in coming voluntarily to the rescue of the Government acted not from patriotism but from interest. If so, then let us thank God that we have financial institutions that consider it their interest to keep the Government solvent. Woe to the country if a majority of the people should find it in their interest to make the Government bankrupt! Well, even after Mr. Bryan's election the banks might be patriotic or prudent enough to come again to the rescue of the Government with their gold, did they not know that it would be absolutely useless. And why would it be useless? Because, it having been made certain by Mr. Bryan's election that the parity of gold and silver would not be maintained, there would be a rush upon the Treasury for the gold in it by persons holding greenbacks entitled to redemption, and the gold reserve would be exhausted in a twinkling.

Gold will instantly disappear from circulation to be hoarded or exported. Why will it disappear? Because every sensible person when making a payment will prefer to make it in the less valuable silver dollar and hold the more valuable gold dollar back for more profitable use. Gold will, therefore, quickly rise to a premium, and we shall be on the silver basis long before a free-coinage law can be enacted. What does it mean to be on the silver basis? The word “coin,” wherever it appears in the law, will no longer mean gold, as it was so far understood, but silver alone. The greenback or Treasury note redeemable in “coin” will no longer be redeemable in gold, as heretofore, but only in silver. The United States bond, payable in coin—no matter whether gold was paid for it or whether it had been sold for the very purpose of buying gold for the Treasury—will be paid principal and interest in silver—repudiation as flagrant as the world ever witnessed. Our daily transactions in buying and selling, in paying and receiving wages, will no longer be carried on upon the basis of the gold dollar worth 100 cents, but of the silver dollar worth 50 cents or thereabout—for the Government will no longer hold up the silver dollar to the value of the gold dollar. That is what the silver basis means. You can study in Mexico how it works.

Now, who will get that Treasury gold when, after Bryan's supposed election, the rush for it is made! Not the farmer, not the laboring man, not those whom the Populists usually call the people. They have no greenbacks ready to present for redemption, and if they had they would hardly be quick enough about it. No, that Treasury gold will be promptly gotten hold of by the big bankers, by Wall Street men and by other persons called by the Populists the “money power,” to be by them used as they think most profitable.

The quantity of gold vanishing from circulation will amount to about $600,000,000, the disappearance of which will make a tremendous hole in the volume of our currency. Nearly one-third of it will be gone, and what remains will be reduced nearly one-half in purchasing power. But, says the silver man, there will be free silver coinage to fill the gap promptly with coined silver or silver certificates. Oh, no, my fellow-sufferers. The disappearance of gold will happen promptly after the election of Mr. Bryan, and there will not possibly be any free coinage of silver for at least six months, and it will require a great many more months to fill a gap of $600,000,000.

What will happen meanwhile? The St. Louis Globe-Democrat reports Mr. Bryan to have said some time ago: “I think it [meaning the victory of the free-coinage movement] will cause a panic. But the country is in a deplorable condition, and it will take extreme measures to restore it to a condition of prosperity.” Whereupon the St. Louis paper pointedly remarks: “Evidently Mr. Bryan has heard of the doctor who always threw his patient into fits before administering any curative medicine.” Just so.

How, then, would Mr. Bryan's “fit” work? The sudden disappearance of our gold from circulation would produce the most stringent contraction of the currency on record. Business men who owe money and at the same time have money due them will be forced to collect that money by every means at their disposal. Nobody will be inclined to lend out any money except upon extraordinary security. The banks will naturally consider it their duty to keep themselves strong, and therefore to call in loans and to restrict their discounts and advances to business men with the utmost caution. Business establishments, manufactories, mercantile houses, unable to get the money for meeting their obligations, will by the hundreds succumb to their embarrassments and tumble down like a row of bricks. Others will cautiously restrict their operations to the narrowest possible limit, and wage-earners by the thousands will lose their employment and be turned into the street.

No class of society will be spared the destructive consequences. Every frightened creditor, pressed by his own creditors, and apprehensive of a growing loss by every day's delay, will eagerly pounce upon his debtors.

The prompt settlement of every account will be peremptorily demanded. Our farmers who have mortgages on their property, and who have been told that free coinage will make things exceedingly easy for them, will have some unexpected experiences. Every mortgage debt that is due will be quickly called in. The mortgagor who tries to have his bond extended will find an unwilling ear. He who seeks to borrow money in order to replace the old mortgage with a new one will be told that this is no time for loans, except, perhaps, upon exorbitant conditions. The mortgagor may find, too, that his bond is payable in gold coin, and he will have to buy the gold at the premium then ruling. Foreclosures will be the order of the day. The mortgagor who seeks shelter under the law's delay will at any rate further burden his property with the cost of legal proceedings. Everywhere anxiety, embarrassment, sacrifice, loss and distress, even before Mr. Bryan could ascend the Presidential chair.

Still there are some who under these circumstances will do a lively and prosperous business: the sheriff, the usurer and the moneyed man who has ready means to buy real estate or other goods for a song at forced sales. That part of the “money power” will lustily thrive on the misfortunes of the people.

But more. We are largely in debt to Europe—not as if Europe had forced us to borrow—but because we solicited Europe to lend us. Our merchants and bankers owe unsettled balances or accounts, and large amounts of our securities are held there—National, State and municipal bonds, bonds and stock of our railroads, street railways and industrial corporations, and even mortgages on city property or farms, placed there by loan companies. The European holders of such securities will be seriously alarmed at the prospects here, and our securities will promptly and indiscriminately be thrown upon the market for what they will bring. A violent decline of prices will be the consequence, of course, here as well as abroad. This will, indeed, in the first place affect those who deal in such securities. People who have borrowed money on their holdings will have to sacrifice them, because they cannot raise the money to protect them. There will, therefore, be a general and ruinous crash in the stock and bond market.

Our silver friends may say that this will not trouble them, and that the more the money-changers of Wall Street come to grief the better. Indeed if it were only the money-changers of Wall Street that suffered we might easily console ourselves. But the bonds of the United States, and of states and municipalities, and the bonds and stocks of our railroads, of street railways and of industrial corporations, are also held largely in this country, not merely by big capitalists, but by people of small means, farmers, wage-earners, who have invested their savings in them; and by savings banks, life insurance companies and trust funds, in which many millions of poor people are interested. Is their loss also a matter of indifference?

Again, our silver friends may say that if Europeans do not “trust silver,” and in their fright throw away our securities at a heavy sacrifice, we can pick up those securities at a splendid bargain; that some of them will, after all, become good, and rise to high figures again, and that thus we shall make a heavy profit on them. This is true. But who will make that profit? Not the farmer, not the laborer in the workshop, not the toiling masses. No, it will be he whom our silver friends love to denounce as the great gold-bug, the rich operator, the very incarnation of the “money power.” That class of men will make those profits and be more powerful than before. The catastrophe in Wall Street, caused by the election of Mr. Bryan, and the ruining of some Wall Street men, would not mean the destruction of what the Populist understands by Wall Street; it would mean some big fish swallowing some little fish, the big fish growing still bigger by the operation. It would not weaken, but more strongly concentrate the so-called “money power.”

How can I foretell these things with so much assurance? Because they have already cast their shadows before. Do you remember the crisis of 1893 when the silver basis was in sight?

And now again the mere apprehension of a possibility of Mr. Bryan's election and of the consequent slipping of our country upon the silver basis has already caused untold millions of our securities to be thrown upon the market in Europe as well as here. Scores of business orders are already recalled, a large number of manufacturing establishments have already stopped or restricted their operations, enterprise is already discouraged and nearly paralyzed. Many works of public utility by industrial or railroad companies have already been ordered off, thousands of workingmen are already thrown out of employment, gold is already being hoarded, capital is already being sent out of the country to be invested in Europe for safety. And why, all this? Not, as the silver men foolishly pretend, because the existing gold standard has made money scarce, for capital is lying idle in heaps, scores upon scores of millions, fairly yearning for safe employment. No; ask those concerned why all this happens, and with one voice they will tell you it is because they apprehend serious danger to every dollar ventured out through the change of our standard of value in prospect through the debasement of our currency threatened by the free-silver-coinage movement. And if these are the effects of a mere apprehension of a possibility, what would be the effect of the event itself? There is scarcely an imaginable limit to the destruction certain to be wrought by the business disturbance that Mr. Bryan's mere election would cause, even before his inauguration. After five or six months of such a deadly crisis, Mr. Bryan's extra session of Congress would begin and give us free coinage. Then as Mr. Bryan solemnly promised us in his great New York oration, free coinage will give us bimetallism, bimetallism will give us an abundance of money and all will be right.

Bimetallism? What is bimetallism? It is a monetary system in which the two metals circulate together for all the purposes of money on a parity with each other upon a fixed legal ratio, which in our case is 16 to 1. Evidently, to have bimetallism gold must be on hand as well as silver. As I have shown, between Mr. Bryan's supposed election and his extra session of Congress our gold will have run away from circulation. Part of it has been privately hoarded, and another, by far the larger part, has gone to Europe, where it finds profitable employment. Thus it turns out that Mr. Bryan's election will have served to possess the American and still more the European “money powers” of most of the gold which he needs here for his bimetallism. This is one of the troubles which the really sincere European bimetallists foresaw when they almost pathetically implored their less sincere American brothers not to think of the free coinage of silver in the United States alone, because it would drive almost all the gold to Europe and attract silver to America, which would make bimetallism impossible in Europe as well as here.

How will Mr. Bryan get the gold back from the “money power”? Evidently he must offer an inducement. What inducement? To be sure, the mints will be open to gold as well as silver. But who will offer gold bullion to have it coined into dollars for circulation when he can have silver dollars with the same legal-tender power at half the price? Only an idiot would do that. Of course gold will be offered only when the silver dollar is up again to the gold standard. There is the rub. But here Mr. Bryan steps in with a theory which is a curiosity in statesmanship. He said in his New York speech: “Any purchaser who stands ready to take the entire supply of any article at a certain price can prevent that article from falling below that price. So the Government can fix a price for gold and silver by creating a demand greater than the supply.” And again: “When a mint price is thus established it regulates the bullion price, because any person desiring coin may have the bullion converted into coin at that price, and any person desiring bullion can secure it by melting that coin.”

What? Is this to mean that under free coinage the Government will purchase silver bullion and pay a certain fixed price for it? If so, then Mr. Bryan, the great free-coinage apostle, does not know what free coinage is. Let us remind him. It means that the owner of silver bullion may take it to the mint and have it coined and returned to him in coined pieces, so many silver dollars for so much weight of pure silver. It does not mean that the Government “stands ready to purchase the entire supply of silver at a certain price.” The Government does not purchase a single ounce of it. It merely receives the bullion, stamps it and returns it. And as to fixing a price, as soon as the Government stops holding up the silver dollar to the gold standard, as it would with Mr. Bryan's election, the silver dollar, measured by its purchasing power, will be worth not a cent more than the market value of the silver contained in it. If the market value of that quantity is 50 cents in gold, and you present at the mint 50 cents worth of bullion, you get back, not a gold dollar, but a silver dollar worth just 50 cents in gold. You might, instead of taking your bullion to the mint, sell it in the market for just the same amount of money. Indeed, bullion owners, unless they have some special reason for taking their bullion to the mint, will take it to the market and sell it there, as they very extensively do in all countries in which there is free silver coinage. Why should they not? Because if they have their bullion coined they get legal-tender dollars for it. If they sell it in the market they get there legal-tender dollars likewise. It will, therefore, be a mere question of special convenience whether they take it to the mint or to the market. And in the market, according to all human reason and experience, its price will, temporary fluctuations notwithstanding, remain on the whole very near to the figure of the cost at which it can in large quantities be produced. Mr. Bryan's strange imaginings have, therefore, proved only that when he speaks of Government purchases of silver, and fixing prices and creating a demand greater than the supply, he simply does not know what free coinage is.

The theory that free silver coinage will make and keep the silver dollar equal in value to the gold dollar rests upon absolutely nothing but Mr. Bryan's incessantly expressed personal belief. Fixed belief is a happy state of the mind. One of the strongest cases of belief I ever met with was a man who inflexibly believed that he was the Pope of Rome and could, if he would, fetch down the moon. He was under treatment by a specialist for mental peculiarities.

Every sensible person, I trust, will now admit that free silver coinage in the United States alone will make bimetallism—the equal use of both gold and silver as money—utterly impossible, here as well as abroad. It will confirm Europe in gold monometallism and condemn us to silver monometallism—the exclusive use of silver as money, and of paper based upon silver. No doubt this is what the silver men are really aiming at.

Let us now consider how it will affect the various interests of the people. The first blessing we are promised will flow from free coinage is a general rise of prices. This means that the silver dollar will buy less than the gold dollar did, and this for the reason that it is no longer worth as much as the gold dollar. Evidently the promise of bimetallism, of silver rising to its old price on the one hand, and the promise of higher prices owing to a less valuable silver dollar on the other hand, do not go together. The one or the other is a fraud. Of course the fraud is the promise of bimetallism. The rise of prices owing to the debasement of the dollar will begin at once as soon as gold departs, and we slip on the silver basis. Bread will be dearer; milk, coffee, sugar, tea, meat and vegetables will be dearer; clothes, shoes and hats will be dearer; rents, furniture, coal, kerosene—in short, every article the price of which can be raised by the seller.

High prices are a two-edged sword—handy to the seller but unpleasant to the buyer. They press, of course, hardest upon those who are compelled to buy most in proportion to their income or their earnings. And who are they? The poor people. What a rich family spends upon the actual necessaries of life, the indispensable food, clothing and shelter, is very little compared with its income. Most of its expenditures are for things that are not necessaries, and may be classed as luxuries, the purchasing of which may be suspended or postponed without hardship. But the poor family, the wage-earner's family, is obliged to spend a very large part of its income from day to day upon food, clothing, shelter, heat and light, that cannot be temporarily dispensed with without hardship. From a rise in the prices of necessaries of life the poor people, therefore, suffer by far the most.

Here I touch one of the most insidious deceptions with which our free-coinage apostles seek to hoodwink the people. They speak of a class of “consumers” as if they were only a lot of rich people sitting in their fine houses and doing nothing but consume; and of a class of “producers,” consisting of all the people engaged in work, especially manual work, doing nothing but produce. And they speak of high prices as if their effect were mainly to make those lazy, rich consumers pay more for the things which the producers make and sell to them. This picture is an insidious lie. The number of people not engaged in any directly or indirectly productive work is, thank heaven, in this country, still very small. And not only they are consumers, but everybody is. Nay, more than that, the poorest laborer is, in proportion to his means, a much heavier consumer than the richest millionaire. And as to the blessing of high prices, they are a grinding hardship, not to the rich, but to the poor consumers, unless their earnings rise in full proportion to the rise in prices. Neither are rising prices a sign of rising business prosperity, except when the rise of prices springs from increasing consumption. It certainly is not when it is caused by a debasement of the purchasing power of the current money.

Make the practical application. Some time ago I read among the published utterances of various persons on the silver question the following from a street car conductor: “I am for Bryan and free silver,” said he. “If he is elected, money will be plenty and circulate more, and then we'll get some of it.” The poor fellow! Let us suppose, then, Mr. Bryan elected. We are happily on the silver basis. The dollar buys its 50 cents worth of goods or thereabout. The wages of our street car conductor are, say, $2.00 a day. His wife, poor woman, goes to the grocer and finds that everything she used to buy for 10 cents now costs 20. She plaintively remonstrates. “I cannot help that,” says the grocer. “You pay me in silver, 50 cents on the dollar. I have to use this money in buying my stock, and need twice as many dollars as I did before. So my customers must pay twice as much or I must close my store.” There is nothing more to be said. It is the same thing when she goes to the butcher, the baker, the shoemaker and so on. Our street car conductor finds that while he and his family could with strict economy live on $2.00 a day, they are fearfully pinched when the $2.00 buys only as much as formerly $1.00. He consults with his friends, and a committee of them apply to the president of the street railway for higher wages. “Higher wages?” says he. “I have been thinking that a reduction of wages will be necessary. For all our supplies and material we have now to pay $2.00 where we formerly paid $1.00. But we get only our 5 cents fare, which is really now 2½ cents. And, besides, our bonds are payable, principal and interest, in gold, and we have to buy that gold at the rate of $2.00 in silver for one gold dollar. How are we to make both ends meet? I really do not know whether we can continue to pay you even $2.00 a day.” The committeemen growl and speak of striking. “Strike?” says the president. “Why, the streets are full of laboring men thrown out of work by the closing of shops since we are on the silver basis. There are thousands of them, men with families, who will jump at the chance of earning even less than $2.00 a day.” The committee look at one another. They know that it is all true. The beauty of higher prices on the silver basis begins to dawn upon them, and they withdraw, wiser but much sadder men; and the conductor's care-burdened wife asks him whether it was really a smart thing to vote for Bryan and plenty of money.

The same will happen to the hundreds of thousands of employees of the railroads in the United States. There is hardly one of those railroads that will not be prevented either by law or by other powerful influences from raising its passenger fares or freight rates to meet the depreciation of the money they receive, and 60 per cent. of their bonded indebtedness is contracted to be paid, principal and interest, in gold. Bankruptcy will stare them in the face, and even those of them that may manage to escape it, will hardly be able to make good to their employees the damage they suffer through the depreciation of their wages through the silver dollar.

How stands the case of the wage-earners whose product can be raised in price proportionate to the debasement of the dollar? As the dollar falls in value the manufacturer or the merchant marks up his goods. The workingman or the clerk, finding himself hard pressed by the rise in price of the necessaries of life, applies for a corresponding increase of wages. The head of the factory or the mercantile establishment admits that some increase is called for. “But,” says he, “you are not the only person in trouble. The value of our money is fluctuating. We hardly know what it is to-day. We surely do not know what it will be next week. Profits are excessively close anyhow. We make a sale or a purchase to-day and think it is at a profit. To-morrow we may find that it was at a loss. We hardly venture to make a contract to be filled at a future time, because we can make no safe calculations. We can increase your wages a little, but not much. For that you will have to wait until things get more settled. Besides, this free silver coinage has thrown all business into dreadful confusion, and there are plenty of people out of employment who would do your work for less than you get now.” And so the wage-earner has to be satisfied with a little increase of pay, and wait for more while the advanced prices of necessaries prey upon him.

Is this mere conjecture? It is the experience of every country that has been cursed by a rise of prices through money of fluctuating value. I defy any one to show me in the whole history of the world a single exception. Did we not during our civil war witness it with our own eyes? In 1862, when our irredeemable paper currency had begun to depreciate, the average wages of labor rose only 3 per cent., while the average price rose 18; in 1863, when wages had risen 10½ per cent., average prices were 49 per cent. higher; in 1864 wages had risen 25¾ per cent., and prices 90½; in 1865 wages had advanced 43 per cent., and prices 117 above what wages and prices had been in gold in 1861. In other words, the laboring man's wages had lost in purchasing power more than 30 cents in every dollar. Every country laboring under similar conditions tells the same story. What reason in the world is there to assume that this universal rule will not operate in the case of free coinage?

And what have the apostles of free silver coinage to say to this? Hear Mr. Bryan himself in his famous New York oration: “While a gold standard raises the purchasing power of the dollar, it also makes it more difficult to obtain possession of the dollar—employment is less permanent, loss of work more probable, and reëmployment less certain.” Is that all? Yes, all. Does not Mr. Bryan know that under what was practically the gold standard we had in the fifties one of the most active and prosperous periods this country had ever seen? Does he not know that more recently, at the time of the return to specie payments, we had under the gold standard years of signal prosperity with all hands at work? And does he wish to learn what has been the trouble since and what is the trouble now? Let him ask the employers of labor, and with almost one voice they will tell him that not the existing gold standard, but the growing danger of its overthrow, that the growing aggressiveness of the free-coinage movement, filling the minds of men with anxious apprehensions as to dark future uncertainties, has served to paralyze that spirit of enterprise which sets the laboring men to work. Let him study the history of the crisis of 1893. Not the gold standard, but distrust of silver, destroyed the confidence that employs labor. This is the truth, and Mr. Bryan will in vain try to deny it.

I must confess, of all the deceptive appeals resorted to by the silver orators, that addressed to the wage-earners seems to me the most heartless and damnable. And of all the instances of reckless credulity we witness, that of wage-earners who actually permit themselves to be persuaded that free silver coinage will be a blessing to them is the most incomprehensible and the saddest. There is something pathetic in their delusion. Of all things, human labor is the one that has during the last fifty years in this country largely and almost steadily risen in price. Average wages have nearly doubled since 1840 and have risen more than 60 per cent. since 1860. The steady rise has been owing partly to organization, in greater part to the larger average productiveness of human labor in connection with machinery—in one word, to the progress of civilization. As civilization has served to multiply and cheapen labor's products, it has at the same time served to enhance labor's earnings. It has thus secured to the laboring man, especially in this Republic, a double advantage—a greater number of dollars by way of wages, and for every dollar more of the things which the laboring man has to buy for the necessities and enjoyments of himself and his family.

This is one of the greatest achievements of our age, at which every true friend of humanity will heartily rejoice, but which more than all others the workingman himself should appreciate. That the workingmen should be called upon, by the exercise of their right as voters, to aid in despoiling themselves of this combined blessing, looks like a satanic mockery. And when we see pretended labor leaders join the silver mine millionaires, the silver politicians and the nebulous silver philosophers in an effort to seduce the workingmen into an act of self-destruction so supremely foolish, there is good reason for warning these of treason in their camp. If there is anybody in the wide world who should fight to the last gasp for a money of true value, that does not lie to him, and who should curse and spurn as his worst enemy the demagogue seeking to beguile him with deceitful currency juggles, it is the man who earns his bread by the sweat of his brow. This is emphatically the wage-earner's battle. Alas for him if he should desert his own cause!

The free-coinage men profess especial solicitude for those whom they call “the debtor class.” Who are the debtor class? Our silver friends speak as if as a rule the rich people were creditors and the poor were debtors. Is this correct? In my household I am the debtor to the cook and the chambermaid and the washerwoman two or three weeks in the month, and they are my creditors. Nor are they likely to be debtors to anybody else, while I may be, for they have little if any credit, while I, perhaps, have some. I am, therefore, the only debtor in my house. The relations between the large employer of labor and the employees are substantially the same. Ordinarily the employer, the rich man, is apt to be the only debtor among them. The employees are, as a rule, only creditors, and as they lay up savings, they are apt to become creditors in a larger sense. They deposit their money in savings banks or invest it in building associations, in mutual benefit societies, in loan companies or in life insurance policies, and become capitalists in a small way. The amount deposited by the people of small means in the savings banks of the United States is at present something over $1,800,000,000, that invested in building associations about $800,000,000, in mutual benefit societies $365,000,000, and in life insurance many hundred millions more.

The number of such creditors belonging to what our silver friends often call “the toiling masses” is therefore very large. Together with their dependents it may, for aught we know, amount to fifteen or twenty millions. Who are the debtors of these creditors? The savings banks had, according to the reports of 1894, loaned out about one-half of the money deposited with them on real estate mortgages, and invested the other half in United States bonds, state, county and municipal bonds, and railroad and other bonds and stocks. The investments of the life insurance companies were about proportionately the same. The investments in real estate mortgages are always preferably in large amounts, on property belonging to comparatively wealthy persons, or to business corporations. Thus the debtors to these creditors belonging to the toiling masses are the United States, states and municipalities, railroad and other corporations, and persons very much richer than the creditors. Here we have, then, rich debtors owing to many millions of poor creditors thousands of millions of dollars.

The silver orators pretend that they have the toiling masses greatly at heart and that free coinage is to be introduced mainly for their benefit. How do they take care of the toiling masses in this case? By bringing us down upon the silver basis they simply cut down the thousands of millions of invested savings of poor people to about 50 cents on the dollar. And for whose benefit is this done? For the benefit of the debtors of these poor people who will gain about 50 cents on the dollar. And who are they? Aside from the United States, and the states and municipalities, those debtors are railroad and other corporations and more or less rich men, whom our silver friends profess to abhor very much as belonging to the “money power.” Thus will the silver standard bleed the poor creditor for the benefit of the rich debtor. May not the toiling masses pray heaven to deliver them of the free coinage friends?

And what have these friends to say in their own defense? I will again let Mr. Bryan's New York oration speak. He says, first with regard to the insurance companies: “Since the total premiums received exceed the total losses paid, a rising standard must be of more benefit to the companies than to the policy holders.” How wise! And that the companies may not have this benefit, he proposes by the silver standard to strip the policies of the policyholders of nearly half their value! But does not Mr. Bryan know that most of these companies are mutual insurances, and that what benefits or injures the companies therefore benefits or injures the policyholders?

As to the savings bank depositors he says: “Under a gold standard there is increasing danger that the savings bank depositors will lose their deposits because of the inability of the banks to collect their assets.” And to avert this danger, Mr. Bryan advises a policy which would, by the introduction of the silver standard, at once cut down the value of those assets to 50 cents on the dollar. He further says: “If the gold standard is to continue indefinitely the depositors in savings banks may be compelled to withdraw their deposits in order to pay living expenses.” Indeed!

It is a remarkable fact that since 1873, the year of the great crime, until 1895, during the period when we had to suffer all the calamities of the gold standard, the deposits in savings banks have, instead of being withdrawn for living expenses, increased, positively increased, much over $1,000,000,000. And they would have increased still more had not some depositors withdrawn their deposits, not for living expenses, but to send them to Europe for safety, out of the way of Mr. Bryan and other friends of the toiling masses. They will, no doubt, bring that money back as soon as Mr. Bryan is beaten.

Let us go on. Almost every man in active business is a debtor and a creditor at the same time—every merchant, every manufacturer—a creditor to his customers and a debtor to those from whom he buys. Let Mr. Bryan bring on his panic, and hundreds, if not thousands of them, although ever so solvent, under ordinary circumstances, will break, because they cannot pay what they owe, being unable to collect what is due them.

Every bank, while being a creditor to its borrowers, is a debtor to its depositors. I say this with great deference to Mr. Bryan, for he has made a profound discovery in economic science. He says in his New York speech: “It is sometimes asserted by our opponents that a bank belongs to the debtor class, but this is not true of any solvent bank. Every statement published by a solvent bank shows that the assets exceed the liabilities.” According to Mr. Bryan, then, one must be a bankrupt in order to be a debtor. We always thought that he is a debtor who owes, whether he can pay or not, and that he is a bankrupt who owes more than he has the means to pay. But the new Bryanese doctrine changes all this. The man who owes, but can pay his debts, is not a debtor, and therefore owes nothing. This will be welcome news to many of his supporters.

But although Mr. Bryan is anxious to exclude the banks from his favorite class of debtors, he is not without solicitude for their welfare. He is evidently haunted by the singular idea that the gold dollar will indefinitely go on appreciating, and that prices will indefinitely go on falling, and that we shall never touch bottom. He reasons that if the gold standard be maintained and prices continue falling, “the bank is apt to lose more of bad debts than it can gain by the increase of the purchasing power of its capital and surplus.” And to avert this trouble, which the bankers themselves almost unanimously refuse to see, Mr. Bryan proposes to make short work of them by a policy which will result in the establishment of the silver standard and make all the debts due to the banks payable in 50-cent dollars.

If he had the slightest conception of the nature of the banking business and of its history, and especially of its recent experiences, he would know that the banks are not imperiled by the maintenance of the existing standard, but have been and will be imperiled by the danger of a debasement of that standard, for the very simple reason that such a danger causes a feeling of insecurity among depositors, a great many of whom will be anxious to with draw their deposits and to get hold of their money before it depreciates, thus bringing on the greatest danger to a bank—a depositors' run. This is substantially what threatened in 1893, when a grave doubt arose in the public mind whether the Government would be able to maintain the gold standard. We were then within a hair's breadth of a very widespread bankruptcy of the banks, and only the wisest management and the utmost efforts of the clearinghouses prevented it. Nothing will be more apt to bring on such a catastrophe than Mr. Bryan's election; and he will then have the satisfaction of welcoming a goodly number of insolvent banks in the fold of the bankrupts whom he considers the only debtors worthy of the name.

Among the farmers of the West and South there seems to be an impression that the embarrassment of the banks will be of small concern to them. I would advise them well to consider how much the sale of their staple products depends upon the ability of the banks to advance the money for moving the crops. They would do well to remember 1893, when, owing to the crisis of that year, the banking machinery did not work, when the large grain storehouses were suddenly obliged to sell out, and grain prices dropped like lead in water. Do the farmers want to have that experience repeated in a tenfold aggravated form? Then they have only to do that which always disturbs the functions of the banking system more disastrously than anything else—threaten with debasement the existing standard of value. Mr. Bryan's election would do that work so thoroughly that the paralyzing effects would keenly be felt on every farm in the land.

But we are told that the Bryan panic cannot last forever; that finally the business of the country will adjust itself to the silver basis; that then unrest will cease and that confidence and prosperity will return. No, the unrest will not cease. For with the establishment of the silver basis will come the disappointment of those who brought it on.

It will be found that whoever wants silver dollars must either sell something for them or work for them or borrow them, or get them by begging, or steal them; that whoever wants to borrow them must give satisfactory security, just as it was with gold dollars before, and that everybody will want more silver dollars than he wanted gold dollars to do the same business, because they will buy less. It will be found that the silver standard will not lower the rate of interest, but raise it, for the lender will make provisions for a further depreciation of the silver money. It will be found that the West and South, in spite of the bombastic speeches now made, will need Eastern or European capital for the more rapid development of their resources just as much as before; that, while capital is lying idle in heaps, the South and West cannot get it as before, because the free-coinage business will have ruined their credit and frightened capital away by a sense of insecurity. It will be found that if the South and West in their eager desire to get that capital would gladly make gold contracts for it, they will, according to the Chicago platform, be prevented from that, too, by a Bryanese law prohibiting gold contracts, as Mr. Bryan himself expresses it, “in the interest of public policy,” and that thus the South and West will be stripped of the only means to get the capital they so sorely need. It will, in short, be found that the disastrous consequences of the free-coinage policy will fall upon no part of the country with such crushing weight as upon the South and West.

Well, and the upshot of it all? Those who now cry out that there must be more and cheaper money, because there is not gold enough, will then cry out that there must be more and cheaper money because there is not silver enough. And then it will be argued that, inasmuch as there must be more money, more money, more money, just as well as we can make 50 cents' worth of silver a dollar, we can make a worthless bit of paper a dollar, and, that, after all, the regular unadulterated fiat dollar without redemption is the true money of the people, the only money that costs nothing, the coinage of which will be truly free, independent and unlimited, the only money that can be made in indefinite quantities until everybody has enough. Madness? Yes. But there are logic and method in this madness. The difference between making 50 cents' worth of silver a dollar and making a bit of paper a dollar is not a difference in kind, but only in degree. After Bryan, Tillman.

However, the ultimate result is not at all uncertain. After a period of infinite confusion, disaster, humiliation, suffering and misery the American people will at last regain sanity of mind, and arrive again at some very simple conclusions: That if you call a peck a bushel, you will have more bushels, but not more grain; if you call a foot a yard, you will have more yards, but not more cloth; if you call a square rod an acre, you will have more acres, but not more land; and if you call 50 cents, or 1 cent, or a bit of paper, a dollar, you will have more dollars, but not more wealth—indeed, a great deal less chance for wealth, for you will have far less credit, because far less honesty. We shall then have learned again that the wit of man cannot, although insanity tries very hard, invent an economic system under which everything you have to sell will be dear, and everything you have to buy will be cheap. And, having got hold of these very simple truths, the American people will then in sackcloth and ashes repent of this insane free-coinage debauch. They will then recognize how wise the great civilized nations of Europe were in adopting the only money in our days capable of being the money of the world's commerce as their own money.

We shall then be sufficiently cured of prejudice to observe that under that monetary system those nations have on the whole prospered, notwithstanding serious evils and drawbacks under which we do not labor, and that the rate of interest is lowest where the gold standard has existed longest. We shall then understand that it is a good thing to have the necessaries of life in plenty and cheap; to have wages rising and payable in money that does not deceive; to have capital inspired with confidence in the value of money, and, therefore, easier to go out in investment or enterprise. We shall then readily acknowledge how foolish we were from the very beginning of our silver experiments in throwing away our gold for silver, by which we lost confidence, credit and prosperity. Chastened by adversity, we shall then no longer be tempted to repeat such nonsense; but with laborious and painful effort we shall work our way back to that money standard which will insure stability and confidence at home and enable us to trade with the nations of the world on equal terms.

And at what price will this ultimate result be gained in the case of Mr. Bryan's election? At the price of the most violent and destructive crisis on record, such a crisis as can only be brought on by a sudden subversion of the standard of values and of the whole basis of credit. At the price of indefinite business paralysis and distress. At the price of the ruthless spoliation of the savings accumulated by the toiling masses. At the price of robbing our war veterans of half the value of their pensions. At the price of greatly increasing the number of unemployed by discouraging enterprise, and of curtailing the value of wages of those remaining at work. At the price of the respect of the world for our intelligence and practical sense. And worse, far worse than all this, at the price of something that has never been forfeited since this Republic was born—at the price of the greatest good a nation can possess, and for the preservation of which it should shed its last drop of blood—at the price of our National honor. For this Nation, so rich and powerful, would stand before the world as a wanton, reckless repudiator, as nothing better than a fraudulent bankrupt. This will be the cost of the experiment. Are you willing to pay this price?

It is not my habit to boast of a warm heart for the poor and suffering. But my sympathy is no less sincere because I do not carry my love and solicitude for the common people constantly at my tongue's end. If there be those who are satisfied with everything that exists, I am not one of them. There are few, if any, who abhor that which may properly be called plutocracy, or detest the arrogance of wealth more heartily than I do. I know, also, that the industrial developments of our time have brought hardship to some classes of people which only the more sagacious, active and energetic among them have been able to counterbalance profitably with its benefits. There are laws and practices which, had I the power, I would promptly change, in the interest of common justice and equity. But because I am so minded, I must oppose to the utmost a policy which, I am convinced, will immeasurably aggravate existing evils. I also know full well that a large majority of those who support free coinage are honest and well-meaning citizens, wishing to do right. But because I know this my blood stirs with indignation when I see the unscrupulous efforts made to goad them on to their destruction. I have witnessed in my long life ten Presidential campaigns, but never one in which the appeals to prejudice, passion and cupidity were so reckless and the speculation upon assumed popular ignorance or rascality so audacious and wicked. Some of the silver orators actually speak as if they believed the American people to be born fools or knaves, or both.

Look at this. To frighten the innocent with the terror of the unknown, a dreadful picture is painted of the “money power” of Wall Street, and worse still, the money power of England, as able, ready and eager to “corner” the gold of the world, and thus to impoverish and enslave the people. Well, if the money power were able and eager to corner the gold of the world, would free silver coinage in the United States prevent it? I have shown that by driving our gold straight into the jaws of the money power, free silver coinage would help that money power in cornering gold. According to the silver authorities there are in the world about $4,000,000,000 of silver and about $4,000,000,000 of gold in circulation. But the silver dollars are the only 50-cent dollars. Now if the money power, with the help of free silver coinage, corners all the gold, it will be able to buy up all the silver and have nearly $2,000,000,000 in gold over. Will it not?

You may say that the money power cannot get hold of the silver, because the silver, in the shape of coin or of paper based upon it, will be in general use as money. But is not, under the gold standard, the gold, in the shape of coin or paper based upon it, in the same general use as money? And if for this reason silver cannot be cornered, will it not for the same reason be impossible to corner gold? This may sound like a huge joke, and so it is. But does it not show that if those terrible things could be done at all, they could be done with silver just as well as with gold? And if it were more difficult with bimetallism—have I not conclusively shown that free silver coinage here would make bimetallism utterly impossible, if it were ever so feasible otherwise?

But Mr. Bryan has in this line a bugbear all his own. In his New York speech, that great deliverance of his statesmanship, he said: “A gold standard encourages the hoarding of money, because money is rising; it also discourages enterprise and paralyzes industry.” This is unique. According to Mr. Bryan, the “gold-bug” will, under the gold standard, hoard his money, and sit on it, because gold is rising in value; and so long as gold does not stop rising, the gold-bug will not stop sitting on it. Why does Mr. Bryan consider the “gold-bug” so stupid? Suppose Mr. Bryan were correct in saying that gold money is rising in value, why should not then the “gold-bug,” instead of sitting on his gold, lend it out on safe, rock-ribbed security at several per cent. more! He would be sure, under the gold standard, of getting his money back in unimpaired value. Can he not thus safely increase his gain? Does not Mr. Bryan think the gold-bug will be smart enough to see that? Does not Mr. Bryan know that good money is hoarded only when, if let out, it is in danger of returning in the shape of less valuable money, and that then money is scarce? Does he not know that gold goes out freely and encouragingly into the business of the country when the owner is assured, as the gold standard would assure him, that it will come back in a money equally valuable, and that then money is apt to be plenty? If Mr. Bryan does not know that, every intelligent grocery clerk can tell him.

Mr. Bryan is certainly a remarkable man, being still so young. I wonder how he found time to accumulate so enormous a store of misinformation, and to develop so mature an incapacity for understanding this subject. I say this in all seriousness, compelled by my respect for the exalted office to which Mr. Bryan aspires. Considering that for years the discussion of these questions has been his only business, and that he has remained so entirely unacquainted with the most rudimentary of economic principles and with the most conspicuous of business experience, we must conclude that he not only does not know, but is unable to learn. Imagine such ignorance coupled with such assurance clothed with great power! Imagine him, as President of the United States, parading such childish absurdities in his messages! It would make us the laughing-stock of the world, and every self-respecting American would hang his head in shame.

But more. Resorting to that cheapest of all hackneyed tricks of demagogy, the excitement of American feeling against England in particular and Europe in general, they tell us that, like a “conquered race,” we are paying “tribute” to the foreigner. What has Europe done to “subjugate” us? Nothing, absolutely nothing, but lend us money. She did not force her money upon us, but lent it when we asked for it and we were glad to receive it. She lent us money when we needed it to maintain the Union and were in dire distress. She lent us money when we wished it to develop the resources of our new country, and now what does Europe ask for? Nothing but what we promised to pay when we took what she lent. Where is the tribute? It is said that Europe largely profited on the loans. On the war bonds, yes, and, having been helped in need, we did not grudge it. But as for the rest, is it not true also that untold millions of European money have been sunk in American enterprises that failed? Tribute indeed! This word can be prompted only by that mean spirit which cajoles the lender as a friend when his money is asked for, and treats him as an enemy and outlaw when he asks for his dues. Is this the spirit of the American people?

They seek to excite the people of the West against the East, because, as Mr. Bryan said in the Chicago Convention, the East injuriously interferes with the business of the West. Aye, the East has interfered with Western business, but how? In helping to build Western railroads, to dig Western canals, to set up Western telegraphs, to establish Western factories, to build up Western towns, to move Western crops, to allay Western distress caused by fire, flood or drought. Has this served to enrich the East? Yes, and so it has enriched the West. Their wealth and greatness have been mutually built up by the harmonious coöperation of their brawn and brain and money, just as the blood of the East and the West mingled on the common battlefields of the Republic. And now comes this young man, as if we had not suffered enough from sectional strife, and talks of “enemy's country!”

They seek to excite what they call “the poor” against what they call “the rich”—in this land of great opportunities for all, where, now as ever, so many of the poor of yesterday are among the rich of to-day, and so many of the rich of to-day may be among the poor of to-morrow. Their candidate for the Presidency presented a characteristic spectacle when some time ago he was kindly shown over the farm of the governor of New York, who is himself an example of the poor country boy risen by able and honest effort to affluence and distinction; and when that candidate then straightway in a public speech drew invidious comparisons between the elegant houses on the Hudson and the poor cabins in the West—teaching not the true American lesson of success won by honest industry, thrift and enterprise, but the lesson that those who have succeeded less should hate and fight those who have succeeded more—a lesson utterly un-American, unpatriotic and abominable!

They tell the farmer—most cruel deception!—that he must and will be made independent of the world abroad, while year after year from $500,000,000 to $700,000,000 worth of our agricultural products must seek the foreign market to find purchasers, and while nothing will hurt the farmer more than a serious impairment of the great home market by a business crisis.

They proclaim themselves the special champions of the toiling masses, while their policy would rob the laboring man of half of his savings, and grievously curtail the value of his wages. Am I asked, if the silver standard will relatively reduce wages, why so many employers of labor are opposed to it? The reason is obvious, because, aside from all considerations of sentiment, the prudent employers of labor know that they would lose vastly more through the disastrous disturbance of business sure to be caused by a free-coinage victory than they could possibly gain by the cheapening of labor. And would not the toiling masses suffer most from that disturbance of business? He is a traitor to the laboring man who tells him that he can profit by the ruin of his employer.

They pretend to be enemies of plutocracy, and advocate a policy which, if I were a selfish, unscrupulous money shark, I should welcome as my finest opportunity. Am I asked, if a free coinage victory would play into the hands of the money power, why the bankers and capitalists are generally against it? The answer is simple. No doubt there are those among the rich of the country who will not scruple at any means to increase their wealth, who will crush their competitors with a rude and lawless hand, and take any advantage of the embarrassment of the unfortunate. They are the men who will thrive most in general ruin. But the vast majority of our bankers and business potentates are honorable men, who are proud of their good name, who treat honestly and fairly those with whom they deal; who do not see their interest in the ruin of their customers, and who know that their own prosperity is safest in the prosperity of all. Therefore they are against free coinage. It is not these, but the worst element of the “money power,” that free coinage will serve. The real pitiless bloodsuckers in the West and South are their own village usurers, their own sharpers around the courthouses, not the legitimate banker or Eastern capitalist.

The agitators denounce the gold standard as the device of monarchs and aristocrats, while the history of the world teaches that from time immemorial it was a favorite trick of unscrupulous despots to fleece their subjects by debasing the coin of the realm, and that those who out of the monetary confusion evolved fixed standards of values and money that would not cheat have always been ranked among the most meritorious benefactors of mankind, and especially of the poor and weak.

They seek to inflame the vanity of the American people by telling them that we are great and strong enough to maintain any monetary system we like, and to keep up the value of our money without regard to all the world abroad—while our own history teaches us that a century ago the American people were strong enough to shake off the yoke of Great Britain, but not strong enough to save their continental money from declining in value to nothing; that in recent times the American people were strong enough to subdue a gigantic rebellion, but not strong enough to keep an indefinite issue of greenbacks at par, and that this Republic may be able to conquer the world, but it will not be able to make twice two five, or to make itself richer by watering its currency.

They speak of the silver dollar as the money of the Constitution, while they must know that there is not one single word in the Constitution which, honestly interpreted, could justify such a claim.

They invoke for their cause the names of Jefferson and Jackson, while every reader of history knows that Jefferson and Jackson would have stood aghast at their wild scheme of creating by law a false value, and would have kicked out of their presence as a public nuisance any one seriously advocating it.

Such things the free coinage agitators tell the American people, assuming them to be without intelligence. Far worse are the appeals they address to them, assuming them to be without moral sense.

They have been teaching the people that because the prices of wheat and other things have fallen about one-half since the so-called demonetization year, 1873,—I have shown why those prices have fallen,—it is not equitable that debtors should be held to pay more than half the amount of their debts in gold, that they should be released in correspondence with the decline of prices, and that it would therefore be right to reduce by free silver coinage the value of the debt-paying money by one-half.

If this were right as a general principle, how would it apply to our debts? Of our Government bonds, there are very few that do not bear date long after 1873. Many of them were sold for the express purpose of bringing gold into the Treasury. Our corporation bonds, are, as a rule, also quite young. But all these obligations are a mere trifle compared with the immense sums of debt contracted in the daily transactions of business. The average life of a real estate mortgage is only five years. But probably nine-tenths of all our debts are those between firm and firm or between man and man in the form of notes, bills of exchange, wage bills and open accounts, the amount of which is incalculable. How old are these? From one hour to six months. How would the principle apply to them? Would there be any equity, or any shadow, or pretense, or quibble of equity in scaling them down 50 per cent. by a sudden drop from the gold to the silver basis?

Subject the principle itself to a simple test. When I contract a debt I owe what it is mutually understood that I am to pay. Our whole business life and social fabric, all human intercourse, rests upon the binding force of such understandings. Unless it be expressly understood, has the debtor the slightest right or reason to demand that the creditor shall be satisfied with a less amount in payment if wheat or cotton or something else had meanwhile declined in price? If so, would not the creditor also have the right to demand that the debtor should pay more in proportion if wheat or cotton or something else meanwhile had risen in price? If neither of them had thought of proposing or of accepting so adventurous a contract, how can such claims be justified if based upon a mere secret mental reservation or an arbitrary after thought? Is it not monstrous that such an assumption should be taken as a warrant for the reduction at one sweep of all debts by a debasement of the standard of value?

You recognize such a principle and carry it into general practice, and there will be the end of all confidence between man and man, the cessation of all credit and trust, the utter subversion of the moral rules governing human intercourse, an unbridled reign of fraudulent pretense and unscrupulous greed—in one word, the overthrow of civilized life.

And yet he who has watched the free coinage agitation knows that just this appeal to debtors is one of its main allurements. Listen to their speeches, read their literature, and you meet ever recurring, now in soft-spoken circumlocution, now in sly suggestion, now in the language of brazen cynicism, the promise that free coinage will enable the debtor to get rid of his obligations by paying only a part of them. It is a scheme of wanton repudiation of private as well as public debts, not as if we could not pay them in full, but because we would prefer not to pay in full—the practice resorted to by the fraudulent bankrupt—and this sanctioned by law, as a part of our National policy.

Fellow-citizens, think this out. It is a grave matter; a matter of vital import to the existence of this Nation. The father who teaches such moral principles to his children educates them for fraud, dishonor and the penitentiary. The public men who teach such moral principles to the people educate the people for the contempt and abhorrence of mankind. The nation that accepts such moral principles cannot live. It will rot to death in the loathsome stew of its own corruption. If the nation accepting such moral principles be this Republic, it will deal a blow to the credit of democratic institutions from which the cause of free government will not recover for centuries.

But thank God! The American people will never accept such moral principles. The American people will, before election day arrives, have fully discovered what all this means. They will indignantly repel the unspeakable insult offered to them by the politicians who have dared to ask for the votes of honest men upon the offer of such a bait. They will know how to resent the deep disgrace inflicted upon the Nation, in the eyes of the whole world, by those Americans who exhibited their own belief that the American people were capable of taking such a bait.

Mr. Bryan has a taste for Scriptural illustration. He will remember how Christ was taken up on a high mountain, and promised all the glories of the world if he would fall down and worship the devil. He will also remember what Christ answered. So the tempter now takes the American people up the mountain and says, “I will take from you half of your debts if you will worship me.” But then brave old Uncle Sam rises up in all his dignity, manly pride and honest wrath, and speaks in thunder tones: “Get thee behind me, Satan. For it is written that thou shalt worship only the God of truth, honor and righteousness, and Him alone shalt thou serve.”

This will be the voice of the American people on the third of November. And the Stars and Stripes will continue to wave undefiled, honorable and honored among the banners of mankind.

1. Speech delivered at Central Music Hall, Chicago, Sept. 5, 1896, under the auspices of the American Honest Money League.