THE WEALTH MAKKUS.
July 25, 1895
trmpt and learns tbeir wart- Each
day ha get shabbier, dirtier, all men
looee respect (or him and be loses all
respect for himself. By the time he
reaches the next town no one would
bare him II they wanted a hand. lie
sits down on a bench and falls asleep;
The police beat the soles of bis feet
and tell him to "move on." If he sits
down he is told to move on. If be
mores on be is in the language of the
law a "vagrant" liable in most states to
be arrested and sent to the stone pile
In company with theives and crimin
als. In a few weeks the honest, In
dustrious workingman Is converted
into a lazy, shiftless, thieving dirty
vagrant. You may turn a doctor of
divinity out to tramp and after he has
pursued the occupation one year I
should bate to have him come to the
backdoor of my house when I was not
at home. Listen: There are many
of our professional tramps who have
a college education and who at
one time were lights in the church.
I insist that the question whether we
hall Continue a financial system
which turns honest, Industrious, sober
working men into thieving, dirty,
drunken tramps, Is a moral question.
But this is not all. Under this
financial system, under this locking
up of natural opportunities thousands
and hundreds of thousands of Innocent
girls are compelled to sacrifice their
virtue for situations. In a large num
bera very large number of establish
ments which employ girls and women
it Is the understanding that wages
paid will only meet their board, and
that for clothing and all other needs
they must depend on the help of a
"gentleman friend." If they express
surprise at the small wages offered
this is frankly explained to them.
The better situations are offered to
the more attractive girls who will
make satisfactory ''arrangements"
with the employer or the heal of the
department. Girls who seek positions
at Washington soon find that positions
are controlled oy the "flooence" of.
Congressmen and that "flooence" can
only be purchased by "favors" which
mean ruin.
Thus we are coining the virtue of the
womanhood of America into dollars.
This Is so because under our land
and financial systems opportunities for
employment are so restricted that
multitudes are out of employment and
the employee is therefore compelled to
accept any conditions that may be im
posed by the employer or starve.
I Insist that the question whether the
women of America shall be made
slaves to the lust of America Is a moral
question.
The conditions of which I have been
peaking and which are the result of
our land and financial systems have so
multiplied and deepened the poverty
of the country that hundreds of thous
ands of little children at 3 or 4 years of
age are either compelled to begin
their own living or are turned on the
street to obtain It by begging or steal
ing. These children grow up with no
knowledge of home, bo knowledge of
God or of Heaven by a cruel power
which they cannot understand and
. from which they cannot escape. They
are condemned before they are born to
lives of pauperism, ignoiance, vice and
crime, a perpetual menace to the so
ciety which has wronged them.
I must forever insist that the ques
tion whether the childhood of Ameri
ca shall be shut out from home and
from hope and from Heaven, and con
demned to Ignorance, vice, pauperism
and crime, is a moral question.
THE CAUSES,
In looking about for the causes of
these conditions we must remember
that panics, hard times, pauperism,
the plunderers of the people and the
unjust distribution of wealth are so
bound up together that in finding the
causes of one we find the causes of all.
Let us therefore look first at the panic
of '93 which Is fresh in the memory of
us all. It is easy to recall the circum
stances attending, first the terrible
scarcity of money; it could not be ob
tained at any price. Accounts due
from the strongest firms could not be
collected. Loans could not be obtained
on any security Depositors became
alarmed for the security of their de-
Soslts and' runs on banks closed the
oors of one bank out of every eight in
the entire nation. Farmers could not
sell their crops because dealers could
not get money with which to buy, or,
if they had money, feared to buy lest
they could not sell. Manufacturers
could not collect from customers, nor
obtain money from banks, and so were
compelled to close their doors and
turn their workingmen upon the
street. Wotkingmen having no em
ployment and consequently no money
could not buy goods or pay bills.
Store keepers and tradesmen with
trade cut down and bills uncollected
could not meet their obligations, and
so .he chain went on. Goods could not
be sold, and so there was an appar
ent surplus of everything, and conse
quently prices of everything declined.
That was the general outline of the
panic, the first point, being inability on
the part of the people to get money for
use in business.
Continuing on after the panlo we
have had hard times, scarcity of em
ployment, dull business, difficult col
lections, low prices and general de
pression. WHAT DID NOT CAUSE IT.
To clear the ground and get at the
real cause, let us first see some of the
things which did not cause the panlo
of "93.v
' With due deference to our protec
tionist friends, it was not caused by
"Tariff reform" or the "Threat of free
trade." There had been no tariff re
form when the panic began, and the
democratic party did not propose to
enact free trade and nobody supposed
that it would, but like effects come
from like causes, and if tariff reform
or the threat of free trade caused the
panio of '93, what caused the precisely
imilar panlo in 1873? That panic
came immediately after the republican
party had carried the country by the
most sweeping majority in Its history.
There was not even a proposition for
tariff reform and not a free trade cloud
upon tbe political horizon. If tariff
reform or the threat of free trade
caused the panio of '93, what caused
precisely similar panics in other
countries where there was no tariff re
form and no threats of free trade. Tar
iff reform and threats of free trade
could not possibly have caused the pan
io of 3.
With all due respect to my free
trade friends, the panic of '93 waa not
caused by the McKinley bill.
Like effects spring from like causes.
If the panic of 1)3 was caused by tbe
protective tariff, what caused tbe pan
to of '7 when McKinley was a boy in
short pants, and tbe panic of 37, be
fore he was born? Both of these pan
ics came during periods of low tariff.
If the panic of 793 in this country was
caused by the protective tariff, what
caused the panio which so shortly pre
ceded it in free trade
England?
With all due respect to my free
silver friend, the panlo of '93 was not
caused by the demonetization of silver,
except In so far as It was an incident
in our general financial system .
If the panlo of '93 was caused by the
demonetization of silver, -what caused
the panlo of 73? which really began be
fore silver had beed demonetized and
which reached its greatest height be
fore the law had time to produce any
effect? If tbe pacic of '93 was caused
by the demonetization of silver what
caused the panio of '57 and '37 which
came upon us when the dollar of the
daddies was with us in all his glory?
And what caused the panics which
have occured In countries wiere fell ver
has never been demonetized? The
panio of '93 was not caused by tbe
Sherman silver bill and by the fear on
the part of the people that our paper
currency would not be maintained as
good as gold-
There never was a more preposter
ously false statement.
The demand during the panio was
for money of any sort. The people
did not care whether it was gold or
silver or national bank notes, or green
backs or treasury notes or silver cer
tificates. There never was a moment
during the panio that silver was at a
discount or gold at a premium. There
never was a moment during the panlo
when greenbacks and treasury cotes
which Carlisle was redeeming in &old
were preferred to silver certificates
which . were redeemable only in
silver dollars. There was one time
during the panlo when the sub-treasury
at New York paid Us dally bal
ances In gold instead of in notes, be
cause the people would hoard the
notes but could not so well, on account
of Its inconvenience hoard the gold.
Just think of the abiurdity of It?
Claiming that the panic was due to the
fear of the people, that the paper
money would depreciate and not be as
good as gold, and then paying out gold
because the people would store away
the paper money they were supposed
to be afraid would depreciate, and
would not hoard the gold which they
were supposed to be laying awake
nights crying for?
The plan was stopped, because the
banks kicked. .Whenever the banks
kick Uncle Sam tumbles.
During much of the panlo on ac
count of the scarcity of small bills,
silver dollars and one and two dollar
silver certificates were at. a premium
in New York. You could at one time
take nineteen silver dollars or nine
teen silver certificates and trade them
for a twenty dollar gold piece. And
during the greater part of the panlo
silver dollars and one and two dollar
silver certificates were at a premium
above gold eagles and double eagles of
from 1 to 3 per cent.
It is commonly stated and generally
believed that silver dollars and silver
certificates are redeemed by the
United States treasury in gold. Thl9
is not true. Silver dollars aid silver
certificates are not and cannot be re
deemed by the treasury In gold. But
during the panlo gold eagles and
double eagles were redeemed by the
business men in silrer dollars and sil
ver certificates, and the gold was at a
discount. And while this was the case
and was being reported in the daily
financial dispatches from New York,
the wise men wen telling the people
that the panlo waa due to the popular
fear of a depreciated silver currency.
Our silver dollars are just as good and
pass as freely as gold dollars and
always will as long as they are equally
legal tender.
The panic and hard times and con
sequent distress ha not been due to
over population and to what some call
the "parsimony of nature," which is
simply1 a polite way of Baying the
stinginess of the Almighty.
For there has been no over-population
and the Almighty is not stingy.
With increase of population comes In
creased po&lbillty of production. Few
men can produce more than ten times
as much as one, and a hundred can
produce more than ten times as much
as ten, and a thousand can produce
more than ten times as much as a hun
dred. Rjbinson Crusoe upon his is
land could never have done more than
secure a living. With his man Friday
both were able to live better than
either could have live! by himself.
The first few settlers on New Eng
land rock bound coast suffered untold
privations not because the coasts were
rock bound and the climate cruel, but
because their number were too few.
New Eegland's coasts are no less
rock-bound now, its skies no fairer, but
wealth is piled in unused masses be
cause of larger population, and this
notwithstanding tbe follies and iniqu
ities of man. There is no parsimony
of nature, God is not stingy. He has
poured out his blessing with the hand
of lavlshness.
Were the national resourses of tbe
country developed even as well as
those of the little Kingdom of Belgium
each family would have an Income of
twenty-five thousand a year.
There Is room enough and soil
enough and air enough and coal
enough and iron enough and timber
enough in the United States to support
in affluence all the population of the
globe, and we could have Mexico for
our winter refuge and Alaska for our
summer resort and the Islands of the
ocean for our Carnigies and Pullmans
to build palaces on. Our troubles are
not due to over-population or to tbe
parsimony of nature. I am opposed
to tbe immigration of the ignorant, the
degraded and the vicious, who corrupt
our people and weaken onr institu
tions, but the coming of the sober, the
Industrious and the honest has never
hurt this country and would not if
every such person in the world came
here. Our Father Is rich and He has
provided enough and to spare for
everyone who ever las or ever will be
born into this world.
The panic was not caused by over
production as has been alleged by
some of our alleged wise men, A. more
Idiotic idea was never presented. We
live on what we produoe. Production
is to a nation what income is to an in
dividual. Whoever heard of a man
who was poor because his income was
too large? Whoever heard of man
who west in rags because ha had too
many clothes? Whoever heard of a
man who went hungry because his
larder was too full?
If there were but one man on this
continent would he be impoverished
because he had grown more food, and
made more clothes and dug more coal
than he needed? Would we not say of
him that he now had a surplus and
would be able to enjoy himself more
and work less than he had been doing?
And it this be true of one man would it
not be true of two, and if true of two
would it not be true of ten and of a
hundred and of a million and of a hun
dred million?
Think of the absurdity of saying
that multitudes are hungry because
the farmers have grown too much
wheat; that multitudes are going in
rags because the manufacturers have
made too many clothes; that multi
tudes shiver over fire less grates be
cause the miners have dug too much
coal?
And there has been no over-production.
In 1884 the corn production of
the United States was 33 bushels per
capita, in '94 it was only 18 bushels per
capita and yet we heard of an over
production of corn.
In 1885 the world's production of
wheat was 2,263,000,000 bushels, in '91
it had fallen to 2, 185,000,000 but we
were told there was an over-production.
In '83 the world's production of cot
ton was 9,409,000 bales, in '93 it was
only 9,008,000 bales, a decrease of 401,-
000 bales and yet we are told tbere
was an over production.
The panlo and hard times were not
caused by underconsumption. That
idea is the twin idiocy with the over
production humbug. What is con
sumption? Destruction. What we con
sume we destroy. The greater the
consumption the less our accumulation.
A man cuts wood all day. Tbat is pro
duction. He burns that wood the next
day, that's consumption. If he cuts
more than he burns he accumulates
and his wealth increases.
Over-production and underconsump
tion are simply different forms for
stating the same idea, production and
consumption are relative. Over-production
is producing more than we
consume. Underconsumption is con
suming (or destroying) less than we
produce.
The accumulation of wealth depends
on the excess of production over con
sumption. The more we produce and
the less we consume the more rapidly
we accumulate wealth. You can in
stantly see that this Is true of a man
and what Is true of a man Is true of a
nation.
I would not have you understand that
the whole object of life should be to
produce as much and consume as little
as possible, for the accumulation of
wealth is not the chief end of man, but
as over production and under consump
tion are the only possible methods of
accumulating wealth, how absurd to say
mat they are the cause of poverty and
suffering.
But, vou say, there is no demand for
my product and as 1 cannot use it all
myself, production Is but waste of time
and labor. But I say unto you there in
a demand. Multitudes crying for bread
and you Bay there is no demand (or
wheat? Multitudes going in rags and
you say there is no demand for clothes.
Multitudes living in tireless homes and
you say there is no demand for coal?
Multitudes that have no place to lay
their heads and you say there is no de
mand for homes. But you say that
those who are needing these things
have nothing to give in exchange for
them, but I say unto you that they have
something to give. The farmer wants
clothes and he has wheat to give in ex
change. The maker of clothes wants
wheat and he has clothes to give in ex
change. The miner wants wheat and
clothes and he has or can produce coal
to give In exchange; and the farmer and
maker cf clothes want coal and they
have wheat and clothes to give In ex
change. All the hungry and suffering ones
have hard labor to give for what others
have, and that labor will produce what
others are needing.
You will find as I go on that it is not
over production nor under consumption
nor excess of supply nor lack of demand
that is troubling you, but an artificial
clamor which prevents distribution and
exchange of what you have produced,
and a system of robbery tbat takes from
you without recompense, the product
of your toil.
And now with all due respect to some
of my prohibition friends I have to say
that neither the liquor traffic nor the
liquor habit were the cause ot the panic
of '93. And here I hope I may not be
misunderstood. I hate tbe liquor traffic
with a pefect hatred. I know its ex
ceeding bitter fruit. I would that every
saloon and brewery and distillery in the
whole world could be blotted out of ex
istence and the art of making Intoxi
cants become one of the lost arts that
should never be re discovered, Twice
in my life, through my opposition
to this traffic, have I sacri
ficed all that 1 had accumulated and
started again penniless in the race. I
would do the same thing again tomor
row, if thereby I could hasten its over
throw. I hold that the only tenable
position of any christian man, or of any
good citizen towards this traffic is con
tained In the statement: "The liquor
traffio must and shall be destroyed."
But I know that the l;quor traffio is
not the only evil In this country and it
is not the only cause evil in this country
1 know that it is in itself the result of a
cause, which came to the unholy greed
of man; and I do not believe in making
of the liquor traffio a scape goat on
which those who plunder and vote and
oppress their fellow men can lay their
sins and have them carried off into the
wilderness of public oblivion.
Tbe first sign of the panlo of '93 was
a scarcity of money In the banks and
the Impossibility of getting accomoda
tions from the banks. The first realiz
ing sense I had tbat a panic was on was
when I sent up a gilt edge $500 note to
get discounted and was informed that
the bank reserve was down to its limit.
During the panlo Chicago parties came
to Springfield and offered our banks
notes of millionaire Springfield
manufacturers at a discount of five per
cent a month or sixty per cent a year
and the banks, anxious as they were for
profits, did not take them because they
could not. I want to do our Springfield
banks justice. I know that during that
panlo when they did have a dollar to
spare, they let It go to Springfield firms
that needed it, at seven percent a year,
when they could have safely made ten
times that per cent by speculating in
the necessities of the people who were
in a corner. I believe that a large ma
jority of tk banks, especially in the
smaller cities and towns are honest
honorable, public spirited citizens, just
as good as men in other occupations,
and just as good as you and I would be
if we were in tbeir places. I am wag
ing no war against-bankers but against
a system which makes bankers a neces
sity and which gives unlimited power
over the people to greedy men who
may be connected witn a bank.
Frightened depositors crowded the
door of the banks demanding their
money and could not get it because the
money was not there and never had
been there. Factories closed because
they could not get the money out of
banks to pay tbeir hands. What did
the liquor traffic have to do with the
scarcity of money in the banks? Noth
ing! Why I've been told that if the
men had not wasted their money in
the saloons they would have deposited
their money in the banks and there
would Lave been money enough to run
the business of the country. What did
the saloon keepers do with the money
when they got it? They did not eat it
or drink it, or make it up into clothes.
Every day every saloon keeper goes
round to the bank and deposits all the
money be has. If a man has twenty
dollars in his pocket, It makes no diff
erence In the amount of available money
in the country whether he deposits that
money in the bank himself or whether
he gives it to a saloon keeper and he
deposits it In the bank. It makes all
the difference between heaven and hell
to the man, but it makes no difference
In the amount of money in the country.
People have so long confounded money
with property that they have formed
the idea that spending money makes it
scarce, just as the consumption of prop
erty makes it scarce; but when money
is spent it does no cease to be, it simply
changes its location. Spending money
does not decrease the amount in exis
tence, or make it less available and bo
far as the matter of scarcity of money
Is concerned it makes no difference
whether wisely or wickedly spent. The
money is still in existence and still
available for purposes o! commerce.
The liquor traffic does cot make money
scarcer, does not cut down the amount
in the banks, does not prevent manu
facturers or business men from getting
loans and could not have created a panlo
But it is argued that if the twelve
hundred million dollars, annually
spent in the saloons were
spent in the legitimate channels
of trade it would give employment tD
all the unemployed workingmen in the
country and give a wonderful boom to
all our legitimate industries.
I have heard able speakers go
through a lengthy course of figures and
divide up this twelve hundred millions.
With so much of it they would buy coal
and so set all the Idle miners at work at
advanced wages; and with so much of it
they would buy carpets and so set all
the carpet weavers at work at advanced
wages. I know the argument by heart
for I have made many a speech and
written many an article along that line,
but one day in following this matter
out to its conclusion I ran against a
snag, and I stopped and began to dig
deeper and learned something. I learn
ed that all this money does go into the
legitamate channels of trade and gives
employment to just as many men, but
that the money parties secured the
product of their labor.
I learned that when this twelve hun
dred millions goes into the hands of
saloon keepers and brewers and dls
tillers and bartenders, they dont eat it
or drink it or burn it up but they
promptly spend it for clothes and ear
pets and food and luxuries, and tbat
while men who spend their money for
drink are wronged and robbed, that
the money itself, gives just as much
employment to other labor. Let me
illustrate.
Smith and Brown work in the same
shop, they are good workmen and each
gets $20.00 a week. When the whistle
blows on Saturday evening, each stops
at the cashier's window and gets his
envelope containing a twenty dollar
bill.
Smith goes home to his wife and
hands her the bill and says, "Jennie,
you need a new carpet for the sitting
room, go out Monday and buy one."
So Monday morning Jennie goes to
the store and buys a carpet, and the
storekeeper gives an order to the man
ufacturer and the manufacturer gives
an order to his men, and Smith's twen
ty dollars gives ten men a days work
making another carpet.
But Brown as be goes home feeling a
little weak and weary, stops at a saloon
to take something to brace him up and
then he takes a little more to brace tbe
or ace r and then a little more for luck
and by the time be has spent a couple
of dollars he Is so drunk that he hands
the saloon keeper his twenty dollar
bill for a two, and the saloon keeper
puts it in the drawer and says nothing
about the change. Then he kicks
Brown into the street for the police to
take care of, locks up, and goes home
and handing Brown's twenty dollar bill
to his wife, says, "Mollie, you need a
new carpet for the nursery, take this
bill I got from that fool Brown tonight
and go out Monday morning and get
one." So Monday morning Mollie goes
to the store and buys a carpet And
the store keeper gives an order to the
manufacturer and the manufacturer
gives an order his men, and Brown's
twenty dollars gives ten men a day's
work making another carpet. The
carpet goes on the floor of the wrong
home but Brown's twenty dollar bill
gave employment to just as many men
making carpet as Smith's.
But if the liquor traffic were destroy
ed and the half million drunken men
made sober would they not go to work
and support their families and so do a
way with that much poverty?
Ye., under righteous economic con
ditions, where those who wished em-
fdoyment could get, it. No, under ex
sting conditions where men cannot
get work because monopoly has shut
against th em the door of opportunity.
There are a million sober men in the
country today who can not get work.
There are half a million drunkards
who could not work if thev could get
it. Sober up the balf million drunk
ards and leave the dom of opportunity
closed as they cow are and you will
simply have a million and a half of sob
er men out of employment.But you say
Is not the liquor traffic a burden on
the community? Certainly It Is. But
it is aburden not because it compels
them to work more in order to secure
the same returns.
Everybody on the face of the earth
must be supported by those engaged in
productive industry. There is no
other source from which they can get
their support. The profit of the earth
is for all. Tne King himself Is served
by the field.
!'-''-.
' All the idle and unproductive of
every class, plutocrats and paupers,
drunkards and dudes, speculators and
sheep stealers, burglars and bond
brokers, railroad wreckers and bar
tenders, tramps and tricksters, all get
everything they have from the labor
of tbe producing classes. The larger
the number of th useless and unpro
ductive class, the less will the useful
class be able to retain of the product
of their own labor. If you are now
able to make a comfortable living by
working nine hours a day you could
make just as good a living by working
eight hours a day if the liquor traffio
were destroyed. And you could make
just as good a living by working four
hours a day if in addition to the de
struction of the liquor traffio monopo
lies were overthrown. The doors of
opportunity opened to all and every
able bodied man enabled and compell
ed to support himself instead of being
a parasite on tbe community. No, the
liquor traffio did not cause the panic
nor is It necessary that we should lay
on the liquor traffio sins other than its
own in order to make it seem to be an
evil great enough to demand destruct
ion. He has Indeed but little sympathy for
human woe if the misery and sorrow in
a balf million drunkards homes is not
sufficient to make him say that the
liquor traffic must and shall be de
stroyed. He has email sense of the value of a
human soul, if the loss of sixty thous
and human souls each year through
the liquor traffio will not arouse him to
action. He who has ever attempted
the impossible task of measuring the
length and breadth and height and
depth of the sin and suffering caused
by the liquor traffio feels no need of
attempting to add to its measureless
measure by charging it with evils
flowing from other forms of human
greed.
What caused the panlo of '93? Listen;
According to the official report of
the comptroller of the currency, the
condition of the banks in the United
States on December 5, 1892 was as fol
lows: Total number of banking institu
tions 9,352.
Total amount of deposits in banks
subject to check, $4,690,890,433.
Total amount of all kinds of money,
including nickles and pennies in all
banks, $596,405,103.
In other words there was on deposit
in the banks of the nations subject to
check eight times as much as the total
amount of money in all the banks com
bined and three times as much as the
total amount supposed to be in exist
ence. That seems impossible. I made
the statement in the paper some time
ago that the deposits in banks exceed
ed the total amount of money in exis
tence, and a man wrote and told me I
was a fool and dared me to explain.
Well, I knew I was a fool. I have
been told so often that doubt would be
Impossible. Most men are, but not all
men have the opportunity to discover
the fact, which a newspaper man en
joys. But, fool as I was, it did not take
me long to explain the matter.
Suppose that there is only a hundred
dollars in existence and Brown haB that.
I open a bank. Brown deposits his
hundred dollars with me and I give him
credit on his bank book. Smith comes
in and wants to borrow a hundred bo I
take Smith's note and he takes the
money and pays it to Jones who de
posits it in my bank and I give Jones
credit on his bank book. I have omit
ted the matter of the legal reserve for
simplicity's sake as it does not change
the principle The deposits in my bank
are now two hundred dollars and there
is only one hundred dollars of legal
tender money in existence. Brown
wishes to pay Johnson fifty and he gives
him his check and Johnson deposits
this check and I give him credit on his
bank book. All this time tbere is a
hundred dollars in money in the bank
and Smith's note for a hundred. But
Smith's note is not a legal tender. All
goes well as long as all payments are
made by check and checks are deposited.
I have a hundred dollars which I can
lend and relend and so supply the com
munity with money and myself with
profit. But one unlucky day Brown
comes in with a check for hia fifty and
asks for currency and Jones comes in
with a check for his hundred and wants
the currency. What's the consequence?
Why the Bank puts up its shutters,
depositors can't get their money, bor
rowers can't be accomodated, business
is paralyzed and there is a financial
panic. The deposits in the bank on
December 5, 1892 consisted in round
numbers of a half billion of money
which was practically legal tender and
four billion dollars of personal no.es,
which were not legal tender but served
the full put pose of money as long as
there was public confidence and nobody
was trying to corner the money market,
and business was done by checks. You
give a bank your note for a $1,000 and
get credit on your bank book for that
sum and begin checking again Bt it.
You are not checking against money
for you have put no money tbere, you
are checking against your note and the
bank's acceptance of your note has en
abled you to use your promise to pay as
money. Thua the business of the coun
try has been conducted with about four
and a half billions of money, one ninth
of which waa money issued by or under
authority of government, and eight
ninths of which was personal note?
used as money by the assistance of the
banks and the confidence of the people
in the banks,
But let the confidence of the people in
the banks be destroyed by accident or
design or let the banks decide to cease
accepting this commeraial paper so it
can be-used as money and the whole
four billions ceases to be available as
money and the amount of money avail
able for purposes of business is reduced
eight-ninths.
Why my free Bilver friends talk much
about the cont! action of the currency
caused by the Demonetization of silver
if all tbe available silver in the whole
world could be coined in a single day it
would not replace this personal money
consisting of checks made against com
mercial paper, and which tbe banks can
extinguish at any moment they feel so
disposed and which they are compelled
to largely extinguish whenever some
combination of Wall St. sharks starts a
panic.
Our greenback friends talk about the
contraction of the currency between
1S65 and 1873. But all the currency
that was called in during that entire
period did not amount to one-fourth as
much as the banks can withdraw in six
month of this personal money consist
ing oi checks made against commercial
paper, whenever they are bo disposed
or compelled
Understand me; If you deposit a
thousand dollars in money in a bank,
and draw checks against it and pay
your bills with those checks, yoa do not
thereby make any addition to the
money in use.
Your checks simply transfer actual
money all ready in the bank, from your
account to some other man's account.
But if you deposit your cote in bank
and pay bills by checking against that
note you thereby add that much to tbe
total actual circulating medium of the
country. You are really coining your
note into money, by tbe assistance and
endorsement of the bank, and circulat
ing your coined notes.
We see therefore that just prior to
the panic there was a half billion gov
ernment money in use, and four bil
lions of personal money issued by the
people with the consent of the backs.
Over the half billion the banks had only
partial control. Over the four billion
of personal money the banks had abso
lute control, not a dollar of it could be
issued without their consent.
Every dollar of it already issued must
be withdrawn, if they issued the edict.
With the first signs of the panic the
edict was issued, "Call in your loans
and reduce your discounts."
And they proceeded to do so as rapid
ly as possible, thus reducing the amount
of personal money by the millions every
hour.
No wonder all business was paralyzed,
I do not say that the majority of the
bankers were disposed to cripple the
business of the country.
I do not think they were.
But under tbe system most of them
could not help themselves.
It was crush others or be crushed.
A few Wall St, Money Kings pulled the
string and the bankers and all the rest
of us had to dance to their music.
I am not waging a war against bank
ers. I am fighting a system which
gives to a self appointed company of
less than ten thousand men, absolute
control over the issue of eight ninths ef
the working money of the country, and
equal control of a large part of the oth
er ninth. 1 do not believe that such
power should be entrusted to any com
pany of men, no matter how nearly
sanctified they may be. I do not be
leiye that all the business men and
manufactures and the farmers and la
borers should owe their right to life,
liberty, and the pursuit of happiness, to
the gracious consent of nice thousand
bankers, even though those nine thou
sand bankers should be the very salt of
the earth. But such is the situation to
day. Eight-ninths of the money so essen
tial in effecting exchange of the pro
ducts of labor consists of this personal
money-checks issued against personal
cotes. Not a dollar of this can be is
sued except with the consent, of the
banks of the country, and every dollar
of this must be recalled whenever the
banks so decree. And that de jree may
be issued at any time as the result of
either corrupt scheming or selfish panic
of the bankers.
Fortunately for the country the banks
have never exercised this power up to
its limit. The withdrawal of the .
whole four billion of personal money
which depends for its existence on the
consent of the banks, would plunge the
country into absolute ruin. No busi
ness could be transacted because there
would be no medium of exchange.
The few hundred millions of govern
ment money in existence would be ut
terly incompetent to meet the task.
Every factory would close, and the
Bound of the whistle be heard no more
over valley and hill. The trains would
stop The stores would put up their
shutters, working men would be idle
and gaunt-eyed hunger would prowl un
molested through our streets until driv
en out by wild-eyed anarchy and the
silence of desolation was broken by the
uproar of destruction.
During the panic some of our la-go
manufacturing establishments stronger
and safer than almost any bank in the
nation tried to meet the difficulty and
continue business by issuing their own
notes in small denominations. Instead
of depositing one note for ten thousand
dollars in bank and then drawing a
thousand cheeks for ten dollars ech
against it, they issued a thousand notes
for ten dollars each and paid them out
to their men. The men would have ac
cepted them. The stores would have
circulated them. The factory issuing
them would have received right along
inpayment for their goods and the
notes were absolutely certain of re
demption. No living man can give any
reason why those notes should not be
as good as the factory's check on bank
against a note dep( sited by that factory.
The only difference is that in the one
case the bank would make a profit on
the transaction and in the other case it
would not. .-
Could this plan have been carried out
by the large strong factories, whose
notes would have been generally ac
cepted, the panic would have been
largely ayerted and hundreds of thou
sands of men been kept at work.
But the government stepped in. This
scheme would be interfering with the
prerogatives of its pets, the nine thou
sand banks. It was a defiance of their
authority. It would enable some busi
ness to be conducted without paying
tribute to the banks, and would have
been a dangerous object lesson in finan
cial independence.
I do not wish you to think that I am
presenting this plan as a solution of the
financial problems; it would be attended
with enormous disadvantages. Only
concerns that had a widespread and un
questioned financial standing could re
sort to it with any degree of . success
and it would be open to some abuses
and many inconveniences that I can
not take time to enumerate.
But there is no question that if the
plan had been permitted during the
panic that it would in a large degree
nave reiievea tne aistress ana wouia
have kept hundreds of thousands of
men employed. Had an occasional
firm failed and the men lost bo much of
these notes as they had in their hands
the loss to them would have been far
less than if they bad not worked
at all. Suppose a man, by this plan
had been kept at work six weeks and
tbe firm failed and he lost one weeks
pay, which he had on hand, be would
have been five weeks pay better off than
the man who had not worked at all.
And suppose that the community in
the case of trong concerns, accepted
these notes and they passed from hand
to hand a money and once in a while
one of these concerns had failed and its
notes that were out in circulation be
came worthless The loss to the com
munity would have been less than the
total destruction of business and far
less than was caused by the dosing of
To be Continued Neit Vrt.l
