'Cbe Conservative.
TIIK SII'VKK Tlio silver certi
CimiCKXCY. ficates , being the
ft ! expressed representatives , dollar for
dollar , of silver dollars deposited , ought
to continue to be exchangeable only for
silver dollars.
The face value of the subsidiary sil
ver coins more largely exceeds their
bullion value than is wise even in the
case of token coins. They might bo
called in and recoined ; but the expense
and inconvenience of that operation are
such as to render its postponement
advisable.
As the owners of a large stock of sil
ver bullion , silver dollars , and subsi-
diaiy silver , the people of the United
States are directly interested in the con
tinued use of silver as currency , pro
vided that the silver can continue to be
maintained at , a par with gold.
The silver dollar is by reason of its
size and weight an inconvenient coin to
cany about the person , or to use in
change. Most people , therefore , do not
desire to use silver dollars as currency ,
if they can have , as representatives of
the coin dollars , notes in denomina
tions of $1 , § 2 and § 5. Even with the
inducement of free transportation from
the Treasury , it has never been possible
to force into circulation at any one time
an amount of silver dollars exceeding
§ 07,000,000 , and there are now outstand
ing only § 60 , 19(5,778 ( , of wliich at least
§ 10,000,000 are held by the national and
state banks. On the other hand , there
are in circulation § 354,355,031 of notes
of the denominations of $1 , § 2 and § 5 , of
which $154,1)05,473 ) are silver certificates
and § 199,389,558 are United States notes ,
Treasury notes of 1890 , and national
bunk notes. Of the total amount of sil
ver certificates outstanding , $154,064,473
are , as before stated , in denominations
of § 1 , § 2 and § 5 , and § 229,205,031 , are in
larger denominations. If , therefore , the
United States notes , Treasury notes of
1890 , and national bank notes of the de
nominations of § 1 , § 2 and $5 , be re
tired , their places can be taken by a fur
ther issue of silver certificates to the
amount of § 199,389,558 in denomina
tions of § 1 , § 2 and § 5 , and an
equivalent amount of silver certificates
of larger denomination be retired , leav
ing of the § 229,205,031 now outstanding
in larger denominations § 29,815,473 to be
redeemed in silver dollars when pre
sented for redemption. If , also , the sil
ver dollars now in circulation and
amounting to § 60,19.0,778 should bo de
posited in the Treasury , the balance of
§ 29,815,473 of silver certificates in de
nominations exceeding § 5 could bo re
placed by an issue of silver certificates
in denominations of § 1 , § 2 and § 5 , and
there might , without any expansion of
the present outstanding circulation , boa
further issue of silver certificates in
denominations of § 1 , § 2 and § 5 , amount
ing to § 30,881,305 based upon the silver
dollars so deposited. The place of the
retired United States notes , Treasury
notes of 1890 and national bank notes of
small denominations would bo taken by
an issue of notes of largo denom
inations of the same kinds , so long as
the United States notes and Treasury
notes of 1800 are unredeemed.
The effect of this plan will bo that
the currency of the country of all de
nominations below § 10 will be silver
coin , and silver certificates based upon
silver dollars held in the Treasury , sup-
plemcnted by gold coins of the denom
inations of § 2.50 and § 5.
The government has received the full
face value for all the silver dollars
which have been put in circulation
either in kind or by means of represent
ative certificates. The silver coins differ
from the note issues only in the fact
that the material of wliich they are
made has some market value as bullion.
They are , nevertheless , as justly obliga
tions of the government and as pro
perly exchangeable at par for gold as
the Um'ted States notes. A gold re
serve must , therefore , bo provided for
such exchange ; but as the retirement of
the United States notes , Treasury notes
of 1890 , and national bank notes of de
nominations less than § 10 will leave the
silver dollar , the silver certificates in de
nominations of § 1 , § 2 and § 5 , the subsi
diary silver , the minor coins , and the
gold coins of the denominations of § 2.50
and § 5 as the only cuiToncy for small
transactions , it is probable that the
trade of the country will keep the silver
and its representatives in circulation ,
and prevent 'the coming in of any con
siderable quantity of that currency. It
is also to be observed that when popu
lar confidence shall have been restored
as to the maintenance of the gold stand
ard and the security of our currency
system , there will bo no general desire
to exchange silver dollars or silver cer
tificates for gold , for the silver currency
will then be , beyond question , as good
as gold.
The Treasury has an asset in its silver
bullion not held against outstanding
certificates , which may bo utilized by
selling it from time to time , as the Ger
man government has done with its sur
plus silver. Of course , such sales should
be carefully made in such quantities as
not to xinduly depress the market for
silver bullion. It is , therefore , sug
gested that authority bo given to the
Secretary of the Treasury to make such
sales in his discretion.
It may bo well to consider whether
the sum of § 452,713,792 of silver dollar
pieces , with seigniorage of over 50 per
cent , which remain as the evidence of a
serious danger to the existing standard ,
is not too largo to be permanently re
tained in our currency ; and if this
should prove to bo the case , whether a
sufficient number of these silver dollars
should not bo ultimately , although not
immediately , withdrawn and sold as
bullion.
It is an essential part of a sound sys
tem of finance , that the government
should raise by taxation a revenue ade
quate to its necessary expenditures.
But as the revenues arc sometimes de
ficient , it is advisable that power bo
given to the Treasury to sell short-term
bonds to supply such deficiency. Under
existing legislation only long-term
bonds can be sold ; and , if the govern
ment comes into possession of a surplus ,
such bonds cannot be retired save by
purchasing them at a premium. On
the other hand , short-term bonds can ,
under a securely established currency
system , be negotiated at low interest
rates ; can be , if necessary , extended at
maturity , and can bo retired by purchase
in advance of maturity without a heavy
loss in payment of premium. For sim
ilar reasons it is suggested that long-
term bonds should contain a reserved
option to the government of retirement.
It is to the interest of the government
and of the people that all the people
should have an equal opportunity of in
vesting their savings in the obligations
of the government when issued. As
the mass of the people have not the nec
essary facilities for the safe custody of
bonds , it is suggested that a system bo
adopted of inscription on the books of
the Treasury , instead of bonds , similar
to that which has long prevailed in the
case of the English consols and the
French rentes. Under this system it
will be possible to place government
loans by a really popular subscription.
J. Laurence Laughlin.
AVIIO DEMAND The widows and
GOLD > orphans to whom pol
icies of life insurance are duo iipon
which a husband and father paid gold
premiums for many yeai-s , demand gold.
They are entitled to gold. Equity di
rects that they bo paid in gold.
The workers with hand and head , who
have saved by frugality and solf-denial
and deposited in banks hundreds of mil
lions of dollars , demand gold. And they
are justly entitled to it because only that
metal , or its equivalent , can have the
same purchasing power as the money
they have entrusted to banks.
"Who wants money with a constantly
declining purchasing power ? Who then
wants the unlimited free coinage of sil
ver at 16 to 1 ? Is it wisdom to counsel
farmers with short corn and wheat crops
to attempt the mitigation of their mis
fortunes by securing more half-bushel
measures ? Ls it not equally wise to
preach prosperity , for those who have
nothing valuable to bo measured by
money , through an expansion of the cur
rency ? The farmer without grain to
measure and the citizen without commod
ities or services to sell have no need of an
increase of measures either for cereals or
other exchangeable valuables.
