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 ^iiBi? Jm liSIH. „?,"*' ""onometallism. 
 
 o.in,a„? 1924 031 254 588 
 
 CORNELL 
 
 UNIVERSITY 
 
 LIBRARY 
 
Bimetallism ^ 
 Monometallism 
 
 INTERVIEW WITH 
 
 The Most Rev. Dr. Walsh - 
 
 ARCHBISHOP OF DUBLIN 
 
 i 
 
 COIN PUBLISHING COMPANY 
 
 115 MONROE STREET. CHICAGO, ILt. 
 
 PUBLISHERS 
 
 1893 
 
 FOR SALE BY ALL NEWSDEALERS 
 
 I ' » t,) u u u u LTij L' i.ruinru'u u u xruisuxru-LTU ltuxtixxj o u l- i/UTJ^jTJOJTjnj^ijTjTjTnjxnj^iJiJTJ' 
 
The original of tliis book is in 
 tine Cornell University Library. 
 
 There are no known copyright restrictions in 
 the United States on the use of the text. 
 
 http://www.archive.org/details/cu31924031254588 
 
Bimetallism and 
 
 Monometallism 
 
 INTERVIEW WITH 
 
 THE MOST REV. DR. WALSH 
 
 Archbishop of Dublin 
 
 • A A A ^ 
 
 COIN PDBLISHING COMPANY 
 
 IIS MONROB STREET, CHICAGO, ILL. 
 
 PUBLISHERS 
 
 1893 
 
 A A A A A 
 
 FOR SALE BY ALL NEWSDEALERS 
 
The interview herein published, with Archbishop 
 Walsh, has attracted the attention of two continents, 
 and the demand for it has become so great, this, the 
 first American edition has been published. . 
 
 Agents are wanted to sell this book in all parts of the United 
 States and Canada. For terms address Coin Pubushing Com- 
 pany, 115 Monroe Street, Chicago, 111, 
 
INTERVIEW. 
 
 1892. 
 
 From, the Freeman's Journal and National Press, 
 Dublin. 
 Question by Reporter: 
 
 "The connection, your Grace, between Bimetallism 
 and the Irish Land Question does not seem very close?" 
 Answer by Archbishop Walsh: 
 
 "Yet nothing could be closer. The adoption of 
 Bimetallism, or of some equivalent remedy, if there 
 be an equivalent remedy, is, I am convinced, a matter 
 of imperative necessity ; that is, if the agricultural 
 tenants of Ireland — and I do not at all limit this to 
 Ireland — are to be saved from otherwise inevitable 
 ruin. 
 
 "This is transparently obvious to everyone who has 
 mastered even the elementary facts and principles of 
 the case. But it is disheartening to find that, not- 
 withstanding all this, no interest seems to be taken 
 in this grave question by many of the leaders of Irish 
 opinion. 
 
 "If things go on as they are, even the excellent 
 Land Purchase scheme which is associated with the 
 name of Lord Ashbourne may become, before many 
 years are over, a source of widespread disaster to the 
 tenants who have purchased under it." 
 
Reporter: 
 
 "The subject of Bimetallism is at all events an ex- 
 ceedingly obscure one?" 
 Answer: 
 
 "Not at all. There is, no doubt, even amongst emi- 
 nent financial authorities, a difference of opinion 
 whether the Bimetallist view as to, the direction in 
 which a remedy for the existing state of depression 
 should be sought for,' is the true view of the case or 
 not. But Bimetallism is in no sense an obscure sub- 
 ject. There is no difficulty whatever in understand- 
 ing it — no difficulty in understanding either what it is 
 in itself, or how it bears upon the Irish Land Ques- 
 tion." ' 
 
 The Archbishop then, in compliance with a request 
 that he would indicate at least the general outlines 
 of the subject, remarked that it was a subject impos- 
 sible to deal with in any way that could be called 
 brief. 
 
 "Bimetallism," he said, "embraces, no doubt, some 
 points that may be omitted in a merely summary ex- 
 position of it — especially in a statement of those as- 
 pects of it that have special reference to the Irish Land 
 Question. But in any case a good deal must remain 
 to be said. 
 
 "As for the Irish farmers, it is to be remembered 
 that the way they come into consideration in the mat- 
 ter is this: — Our farmers, many of them, are placed 
 under an obligation to pay, annually, a fixed amount 
 of money — 'fixed,' that is to say, in thp sense that 
 the amount they have to pay, year after year, for a 
 prolonged- term of years, is specified in pounds, shil- 
 lings and pence. 
 
5 
 
 "There are three classes of our Irish farmers lying 
 under such an obligation. In the first place, some 
 have, 'as ordinary leaseholders, to pay, for longer or 
 shorter periods, a sum so fixed. Others have to pay 
 a fixed sum for 15 years, as 'judicial' tenants under 
 the arrangements of the Land Act of 1881. Others, 
 — as tenant-purchasers under one or other of the Irish 
 Land Purchase Acts, — ^^have to pay, for 49 years, a fixed 
 sum to the Government. 
 
 "Now, in the present condition of our currency laws, 
 any obligation of paying a fixed amount of money for 
 a prolonged term of years may bring with it financial 
 ruin to the unfortunate tenant who has undertaken 
 that obligation, or upon whom it has been imposed 
 by law. 
 
 "Indeed I may say that, under the operation of the 
 present Monometallic system of currency, any such 
 obligation must, in the course of time, bring with it, 
 if not financial ruin, at all events most serious finan- 
 cial embarrassment. The reason is obvious. The 
 conditions of the case are such that, notwithstanding 
 the so-called 'fixing' of the amount to be paid each 
 ■ year, the payment of the amount thus 'fixed' in pounds, 
 shillings, and pence, really represents a burdin grow- 
 ing heavier and heavier from year to year. 
 
 "This is how the 'tenants' case stands, in the view, 
 at all events, of the Bimetallists — to say nothing, for 
 the present, about the extent to which, upon this par- 
 ticular point, the views of the Bimetallists are shared 
 by some leading upholders of Monometallism. As for- 
 the Bimetallists, it is important to remember, espec- 
 ially upon a point such as this, that one of the leading 
 champions of Bimetallism, is Mr. Balfour, our late 
 Chief Secretary for Ireland. 
 
"With Mr. Balfour, then, as with all Bimetallists, it 
 is a cardinal principle that, as a direct result of the 
 present monetary system of England and of other lead- 
 ing commercial European countries, everyone who is 
 under an obligation to make a yearly or other periodic 
 payment of a 'fixed' amount, — as, for instance, a 'ju- 
 dicial' tenant under the Land Act of 1881, or an Irish 
 tenant-purchaser under the Ashbourne Act of 1885 or 
 any subsequent enactment, — is thereby placed under 
 a burden which necessarily grows heavier from year to 
 year. 
 
 "All this the Bimetallists make good in proof. But, 
 quite apart from the proofs which they bring forward, 
 can anyone deny that even the mere authority of so 
 many men of eminence in financial science as are to 
 be found in the ranks of the ' Bimetallists ought to 
 count for a good deal? It surely should suffice, at the 
 very least, to show that any one — any tenant, for in- 
 stance — will have only himself to blame for whatever 
 disaster maj- befall him, if he disregards the clear and 
 impressive warning given him by Mr. Balfour and 
 other Bimetallists of the gulf that is yawning before 
 him, and takes upon himself an obligation to pay 
 yearly, for 49 years, or even for 15 years, a 'fixed' 
 amount of money, — that is to say, an amount specified 
 in pounds, shillings, and pence, — without making full 
 allowance in his calculations for the risk he runs of 
 finding himself, as years go on, overloaded, and, in the 
 end crushed, by the weight of an ever-increasing bur- 
 den. 
 
 "The Bimetallists may be right or they may be 
 wrong. But at all events, if they are right, then it 
 is undisputably plain that the Irish tenants who have 
 
the misfortune to have their rents fixed for terms of 
 15 years, under the Land Act of 1881, — and, much 
 more so, the Irish tenant-purchasers, who have the 
 misfortune to find themselves saddled with the obli- 
 gation of making annual payments fixed for 49 years, 
 — are simply slipping down an inclined plane, with 
 bankruptcy awaiting them at the bottom of it. 
 
 "It is only quite recently that I came to know some- 
 thing of the gravity of the present state of affairs. Now 
 that I have become aware of it, I feel bound, as a 
 matter of public duty, to do what I can to bring it to 
 the knowledge of those whom it most concerns. 
 
 "In connection with all this, I would again call 
 attention to the fact that, in such a case, Mr. Balfour's 
 authority must be recognized as of exceptional weight. 
 Surely the tenants, and those who advocate or repre- 
 sent the tenants' views, ought to insist that this point, 
 which is brought out so forcibly by Mr. Balfour and 
 others, shall be taken into account as an important 
 element in the fixing of fair rents for terms of years, 
 and — as a matter of still higher importance — in the 
 fixing of terms of purchase involving the obligation of 
 fixed annual payments for still longer periods. The 
 point, as I have already stated it, is, that every one 
 who IS placed under an obligation to make yearly payments 
 of a' fixed amount of money, is thereby placed under a bur- 
 den which is growing heavier from year to year. 
 
 "If this point be insisted upon, as assuredly it ought 
 to be, by the tenants and by their representatives and 
 advocates, how can the landlords, or those who advocate 
 and represent the views of the landlords, take it upon 
 themselves to say that the Bimetallists are not to be 
 listened to in the case? Their ideal statesman, Mr. 
 
8 
 
 c 
 
 Balfour, they must be reminded, is a pronounced and 
 thorough-going Bimetallist. From this point of view, 
 the emphatic and unqualified declaration of our late 
 Chief Secretary is of momentous importance. 
 
 "Then, if anything more is wished for than the mere 
 authority of the Bimetallists — more even than the au- 
 thority of Mr. Balfour himself — let me point out .how 
 their conclusion is reached. 
 
 "I happen to have here a Statement which I wrote, 
 for another purpose, some time ago, and which I can 
 give to you. It is a statement of a few elementary 
 facts and principles of political economy facts and 
 principles that must underlie every explanation of 
 the currecny uuqestion. The points set out in it are 
 purely elementary matters. They require, I think, no 
 explanation, as they certainly require no proof. 
 
 "They are these: — 
 
 "il Money forms our common medium of exchange. 
 At first, commerce, such as it was, had to be carried 
 oh by a system of pure barter — the system in which, 
 for instance, so many sheep were given in exchange 
 for so many cows, so much corn for so much wool, 
 and so on. Then, as civilization progressed, this sys- 
 tem of pure barter was displaced by the employment 
 of a common medium of exchange, available in all 
 cases of selling and buying. Great diversity existed 
 among various tribes and peoples in the choice of the 
 particular medium employed. In some places, skins 
 were used ; in some, leather ; in some, corn ; in some, 
 cattle. Then came a higher stage of development, 
 when metals, such as iron, tin, lead, and copper, were 
 employed. But now, with practical universality, all 
 
other materials for standard money have given place 
 to gold and silver. 
 
 "i. 'Money, as regards its primary function, is sim- 
 ply a commodity, selected first by custom, and (often 
 but not always) confirmed by law, as an intermediary 
 in transactions — a something for which, in a civilized 
 community, any other thing can be sold, and with 
 which any other thing can be bought: In other words, 
 a particular commodity is selected to perform the ' 
 function of a common measure of value ; Ijut it is, and 
 remains, a commodity. Gold remains gold, silver 
 remains silver, while they perform this function ot 
 money ; and they remain subject to exactly the same 
 laws of exchange as before. A new use is imposed 
 upon the substance; that is all; the substance itself 
 is unchanged. 
 
 "3. By the 'value' of money, we are to understand 
 its 'exchange value,' or, in other words, its purchas- 
 ing power — that is to say, the power which the pos- 
 session of money gives to those who possess it to go 
 into an open market, and obtain, in exchange for their 
 money, the things that are on sale there. 
 
 "4. The metals, gold and silver, like all other 
 marketable commodities, are liable to fluctuations in 
 value ; their value being controlled, like that of all 
 other commodities, by the law of supply and demand. 
 This means that if gold and silver are to be had in 
 abundance, a smaller quantity of other commodities — 
 as, for instance, less corn, less hay, less butter — will 
 have to be given in exchange for a definite quantity 
 of gold and silver. On the other hand, if gold and 
 silver are not so easily to be had, then, a larger quan- 
 tity of other commodities, — more corn, for instance, 
 more hay, more butter — will have to be parted with, 
 
10 
 
 to obtain in exchange for them the same quantity of 
 those metals. 
 
 ■'5. 'It is now universally admitted in works of Po- 
 litical Economy that any such thing as a commodity 
 with absolute stability of value is unattainable.' 
 
 "6. 'The most important characteristic of a good 
 monetary standard is, that it should preserve compar- 
 ative stability of value. The principal reason why, 
 of the multitude of commodities that have been used 
 for the material of money at different times, gold and 
 silver have survived as the fittest, is because their 
 great durability renders the total stock extremely large 
 compared with the annual supply, and thus eliminates 
 one element of instability of value.' 
 
 "7. Another special advantage of gold and silver 
 for monetary purposes is that both the weight and the 
 purity of coins made from them may easily be ascer- 
 tained. 'At first, after gold and silver were generally 
 adopted, the risk of being defrauded by inferior qual. 
 ity or adulteration was left entierly to the receivers 
 of the metals ; in fact, gold and silver circulated be- 
 tween the inhabitants of the country simply as mer- 
 chandise. . . Very early, however, it began to be 
 recognized that there would be great convenience if 
 pieces of the metal were certified by authority to be of 
 certain weights and fineness ; and, accordingly, coin- 
 age has always been one of the first industrial func- 
 tions that governments have undertaken. 
 
 "8. Coinage is only a process of branding or stamp- 
 ing, and nothing else. The process of minting certi- 
 fies two things: first, that the coin is of a certain 
 weight of gold or silver, as the case may be ; and, 
 secondly that the gold or silver of which the coin is 
 composed is of a certain specified degree of purity. 
 
II 
 
 But minting — the minting, for instance, of gold into a 
 sovereign — adds nothing to the value of the piece of 
 metal that is coined. 
 
 "9. It is not, however, to be supposed that the 
 commodity, gold, or the commodity, silver, does not 
 derive a special value from the fact of its being con- 
 stituted a standard monetary metal. 'Law singles out 
 gold or silver, or both, to be used as money, and gives 
 them special functions which it confers on no other 
 commodity. In virtue of this selection^ the demand 
 for these metals is greatly increased, and, as they are 
 only of limited production, their value is increased 
 accordingly. ' 
 
 "10. A sovereign is a minted coin consisting of a 
 certain specified weight of gold, of a certain specified 
 fineness. The weight of a sovereign when issued from 
 the Mint is the JIard part of an ounce, or 123.27447 
 grains, of standard gold. 
 
 "11. A fluctuation in the value of gold involves a 
 fluctuation in the value of the sovereign. 
 
 "This, of course, does not mean that the sovereign 
 can ever become worth more or less than twenty shil- 
 lings. That would be a contradiction in terms. For 
 'a shilling' means merely the twentieth part of the 
 value of a sovereign. 
 
 "When we say, then, that the value of a sovereign 
 may fluctuate, what we mean is that, as a medium of 
 exchange, the sovereign will sometimes have a greater 
 sometimes a lesser, 'exchange value' or purchasing 
 power. 
 
 "The reason of the liability to fluctuation in the 
 purchasing power of the sovereign is plain. When 
 gold rises in value, a larger quantity of any other 
 commodity, — say, of corn, of hay, of butter, or of 
 
12 
 
 cloth, — will have to be given in exchange for any given 
 quantity of gold, such, for example, as the quantity 
 contained in a sovereign. On the other hand, when gold 
 falls in value, a smaller quantity of any other com- 
 modity, — say, of corn, of hay, of butter, or of cloth, — 
 will suffice to obtain in exchange for it any given quan- 
 tity of gold, such as that contained in a sovereign. 
 
 "x2. It is an obvious inference, that our- gold coin- 
 age, however useful as a medium of exchange, does 
 not furnish us with a standard of value, fixed and un- 
 alterable. It does not furnish us, for example, with 
 such a standard as the yard is of length, or as the 
 pound Troy is of weight. 
 
 "13. The popular notion, then, of the sovereign, or 
 pound sterling, constituting a fixed standard of value, 
 is merely a popular delusion. 
 
 "The sole foundation for that delusion manifestly 
 is, that, in these countries, the values of all commodi- 
 ties are commonly stated in terms of the pound ster- 
 ling, in other words, in pounds, shillings and pence, 
 — 'a shilling' meaning the twentieth part of a pound, 
 and 'a penny,' the twelfth part of that again. The 
 natural result of this method of expressing the values 
 of commodities other than gold, is, that, to the su- 
 perficial observer, the impression conveyed by a rise 
 or fall in prices is that it is the value of all other 
 things that changes, the value of the sovereign remain- 
 ing fixed. 
 
 "14. In Great Britain, — and the same is true of Ire- 
 land, and of many other countries — gold being the one 
 standard metal, all prices are stated in terms of the 
 sovereign, or parts of the sovereign. So that for in- 
 stance, if, at any time, a certain quantity of corn sells 
 for ;^ioo 5^-. iO(/., this means that this quantity of 
 
13 
 
 corn represents, in exchange-value, loo sovereigns^ 
 with the fourth part (5^.) of the value of a sovereign, 
 and the sixth part (iO(/. ) of that again. 
 
 "But in countries, such as India, where silver is the 
 one standard metal, all prices are stated in reference 
 to the rupee, — a standard silver coin which may be 
 compared, roughly, with our two-shilling piece. 
 
 "Prices stated in terms of a standard gold coin, as, 
 they are stated in England and Ireland in terms ot 
 the sovereign, are spoken of as "gold' prices. Prices 
 stated in terms of a standard silver coin, as they ara 
 stated in India in terms of the rupee, are spoken ot 
 as 'silver' prices. 
 
 "15. The price of things estimated in gold, — their 
 ■gold price' — may change, whilst their price estimated 
 in silver — their 'silver price' — remains unaltered. 
 
 "This will occur if the value or purchasing power 
 of gold goes up or down, while the value or purchas- 
 ing power of silver remains unaltered. 
 
 Suppose, for instance, that gold is in any way scarce 
 in relation to the demand upon it. Then in any 
 country where gold is the standard metal of the cur- 
 rency, those who wish to obtain a certain quantity of 
 gold, whether in coin or in bullion, will have to give 
 a larger quantity of other commodities in exchange for 
 it, or — to put the matter in another light — those who 
 have only a definite quantity ,of commodities to part 
 with will receive less gold in return for them. In 
 other words, there is a fall in 'gold prices.' 
 
 "Suppose, on the contrary, that gold is abundant in 
 relation to the demand upon it. Then those who 
 wish to obtain a certain quantity of gold, whether in 
 coin or in bullion, will not have to give so large a 
 quantity of other commodities to obtain the quantity 
 
14 
 
 of gold they require, or — to put the matter, as before, 
 in another light — those who have a definite quantity 
 of other commodities to dispose of will obtain more 
 gold in return for them. In other words, there is a 
 rise in 'gold prices.' 
 
 "If, in either case, there is no change in the value 
 of silver, then the prices of commodities, stated in 
 silver — their 'silver prices,' as the technical phrase is 
 — will remain unchanged. 
 
 "Similarly, of course, the 'silver price' of things 
 may change, while their 'gold price' remains unal. 
 tered. " 
 Reporter: 
 
 "Is this common ground, so far?" 
 Answer: 
 
 "Yes. But now we reach the point at which Mon- 
 ometallists and Bimetallists begin to differ. Take 
 it in this way. A country may arrange its system of 
 standard money upon either of two bases: it may take 
 only one of the precious metals as its standard of 
 value — " 
 Reporter: 
 
 "This is Monometallism?" 
 Answer: 
 
 "Yesj no matter whether the metal selected is gold 
 or silver. 
 
 "India, for instance, is a 'silver' monometallic coun- 
 try: the standard there is a rupee — a silver coin, 
 which, as I have already said, may be compared, 
 roughly, with our florin or two-shilling piece. 
 
 "England, on the other hand, is a 'gold' monome- 
 tallic country, the standard coin being the sovereign. 
 As to the silver coins of the English currency, every 
 one knows that, though they are current in a limited 
 
IS 
 
 quantity, they are not legal tender' in paytaent of 
 debts for any amount beyond 40^-. The silver coins, 
 then, of the English mint are merely what are termed 
 'token coins,' — the value of the silver in twenty of 
 our shilling-pieces being altogether short of the value 
 of the gold in a sovereign." 
 Reporter: 
 
 "Then as to Bimetallism?" 
 Answer: 
 
 "Bimetallism, as some writers express it, is the 
 monetary system in which the two precious metals, 
 gold and silver, are taken as standards of currency. 
 
 That, however, is a misleading way of putting the 
 case. The word Bimetallism indeed is an unfortunate 
 one to have been chosen. It gives prominence to the 
 idea of duality, and so leads many half-informed peo- 
 ple to think that Bimetallism, as distinct from Mono 
 metallism, aims at having two standards of value, in- 
 stead of one. 
 
 "Now this is not at all the case. In the Bimetallist 
 system there are not two standards of value ; there is 
 but one. One of the essential requirements of a stand- 
 ard, whether of value, or of length, or of weight, or 
 of anything else, is that it should be one. The word 
 Bimetallism, then, as I have said, is, in one respect, 
 an unfortunate one to have been chosen. It gives rise 
 to an unhappy notion that the Bimetallists favgr some 
 sort of shifting or alternative system of standards. 
 But this is not so. The very opposite is the fact. 
 Unity of standard and stability of standard— in so far 
 as stability in this matter of a standard of value is 
 within the reach of attainment — these are the very 
 fundamental pc^ts of Bimetallism." 
 Reporter: 
 
 "Is not this so also in Monometallism?" 
 
i6 
 
 Answer: 
 
 •'No. A little further on we shall deal with the im- 
 portant point of stability in the standard of value. 
 But take first this matter of unity of standard. Does 
 Monometallism secure unity? Nothing of the kind. 
 What have we, as the result of the present predomi- 
 nance of Monometallism in so many countries? Sim- 
 ply division and confusion. 
 
 "In one set of countries, such as England and Ire- 
 land, gold is the standard metal. In another set of 
 countries, such as India, the standard is silver. When 
 a 'silver' country, such as India, comes to trade with 
 a "gold' country, such as England, see what happens. 
 Gold and silver are two independent commodities. 
 In the markets of the world, then, each, from the op- 
 eration of the law of supply and demand, is subject to 
 its own independent fluctuations in value. There is 
 nothing to keep the relative values of the two at a 
 fixed ratio to one another. So, the 'gold price' of 
 silver, or, in other words, the 'silver price' of gold, 
 is constantly changing. 
 
 "Take the last 19 or 20 years, for instance. The 
 ■gold price' of silver per ounce has ranged from 5^. 
 od. down to y. 3^. This necessarily has affected the 
 relative value of gold and silver coins. The Indian 
 rupee, then, which formerly counted as a two-shilling 
 piece — 10 rupees being, roughly, the equivalent in 
 value of a sovereign — came tumbling down in value 
 until, as measured by the sovereign, it was worth is. 
 ^d. or IS. \d. 
 
 "In other words, a person in India, who, for any 
 purpose, had to make a remittacne of ;^5o to England, 
 would some years ago have found 500 rupees sufficient, 
 but of late years he might have had to send 800." 
 Reporter: 
 
 "This is from a fall in the value of silver?" 
 
17 
 
 Anstver: 
 
 "It could happen as the result either of a fall in 
 the value of silver, or of a rise in the value of gold. 
 
 "So far as the facts I have as yet stated are con- 
 cerned, the change in the relative values of the sov- 
 ereign and the rupee may have come either from one 
 cause or from the other. We shall afterward deal 
 with the cause of the change. I am now merely call- 
 ing attention to the fact that, as things are, we have, 
 under the denomination! of so-called Monometallism, 
 not one common standard of value, but two distinct 
 standards — gold, in England, for instance, and silver 
 in India — each metal being liable to fluctuation in 
 value, and the fluctuations in one being wholly inde- 
 pendent of the fluctuations in the other. Plainly there 
 is nothing in th^ nature of things to hinder gold from 
 fluctuating in value whilst the value of silver remains 
 unchanged ; nothing to hinder silver from fluctuating 
 in value whilst the value of gold remains unchanged; 
 and, in fine, nothing to hinder both gold and, silver 
 from fluctuating in value at the same time, and fluc- 
 tuating very notably, and in opposite directions. 
 
 "This is what we are exposed to in the present Mon- 
 ometallic system. It in no sense results in unity. 
 It results in duality and divergence, pure and simple. 
 
 "Now, on the contrary, the aim of the Bimetallists, 
 instead of being — ^as is sometimes incorrectly supposed 
 — ^to set up a duality of standards, is to bring about 
 a common standard of value, ps far as possible every- 
 where, in 'gold' countries and 'silver' countries alike. 
 What Bimetallists contend for, in the first place, is 
 that the unity which is one of the first requisites in 
 a monetary standard has not been attained in our pres- 
 ent Monometallic system. Furthermore they contend 
 1;bat it can be brought about only by the adoption of . 
 
i8 
 
 the system they advocate, which is, to make the stand- 
 ard of value — if possible everywhere, but, at all events, 
 over the largest possible area amongst the commer- 
 cial nations of the world — consist, not of one or of the 
 other of the two precious metals, gold or silver, but 
 of a combination of the two, linked together." 
 Reporter: 
 
 "But how can two metals be linked together, so as 
 to form, combined, one standard of value?" 
 Answer: 
 
 "That is easily shown. Here, for instance, is how 
 they were combined in the system which was in opera- 
 tion in France down to 1873 — " 
 Reporter: 
 
 "Down to 1873? Then Bimetallism is not a mere 
 untried theory?" 
 Answer: 
 
 "So far from being untried. Bimetallism was at one 
 time in operation in several European countries, and 
 this continued for many 5'ears. But there is a special 
 reason for taking the system as it was in operation in 
 France from 1803 to 1873. Bimetallism was estab- 
 lished there in 1803 by Napoleon. At that time, the 
 English currency system also was Bimetallic. Bimet- 
 allism had been established in England in 1717, on 
 the recommendation of Sir Isaac Newton, then Master 
 of the English Mint. It was not abandoned by Eng- 
 land until 1816. But, speaking of France, here is how 
 Bimetallism worked in that country down to 1873. 
 From 1803 to 1873, the French Mint was open for the 
 unrestricted coinage, whether of gold or of silver, 
 either metal being accepted for coinage in the ratio of 
 15^ to I, — for instance, i^^ ounces of silver or 
 I ounce of gold was coined into an equal sum of 
 money. 
 
19 
 
 "In 1865, the same arrangement was adopted by thb 
 other countries of the group known as the Latin Union 
 — Belgium, Switzerland, Italy, and Greece. 
 
 "Down to 1873, then, anyone, in any part of the 
 world, who had either gold or silver bullion to dispose 
 of, could have taken it to the Mint of any of those 
 countries and there made it into coin. 
 
 "Here are the three points of the Bimetallic system 
 as it was carried out in those countries. First, any 
 given quantity of gold bullion was always exchange- 
 able at the Mints for its weight in gold coins; and 
 any given quantity of silver bullion was likewise ex- 
 changeable for its weight in silver coins. Secondly, 
 the coins given out in return for any weight of stand- 
 ard gold bullion, were of 15^ times the value of 
 those given out in return for the same weight of silver 
 bullion. Thirdly, all those coins, whether of silver or 
 of gold, were 'legal tender,' within the country, for 
 the discharge of all debts, to any amount. 
 
 "It can hardly be necessary to point out that when 
 the two metals are thus taken into the standard cur. 
 rency, the fixing of a ratio of value between them, — 
 that is, between the mint value of a given weight of 
 one and the mint value of the same weight of the 
 other, — is a matter of absolute necessity. 
 
 "Except at a fixed ratio of value between them, the 
 two metals could not be kept in circulation in a coun- 
 try as money. That is admitted on all hands. If no 
 check were kept upon the tendencies to divergence 
 between the respective values of gold and silver — the 
 value of each being left to be determined merely by 
 the chances of supply and demand in the markets of 
 the world — commerce would be rendered practically 
 impossible. For it would be open to debtors to dis- 
 
20 
 
 charge their obligations in one or in the other accord- 
 ing as one or the other was, for the time, proportion- 
 ately less in value. That would be utterly subversive 
 of the certainty which is an essential basis of all com- 
 mercial transactions." 
 Reporter: 
 
 "Whilst the French and other Mints were open for 
 the unlimited coinage of gold and silver, the English 
 Mint was not open in the same way for the coinage 
 of silver to the same extent?" 
 Answer: 
 
 "No; nor for many years before 1873. England had 
 abandoned Bimetallism in 1816, when Uord Liverpool 
 made what everj' Bimetallist must consider the de- 
 plorable mistake of substituting a gold Monometallic 
 system for the Bimetallic system which had been 
 maintained in England ever since its adoption, on the 
 recommendation, of Sir Isaac Newton, a hundred years 
 before. 
 
 "Since then, silver has been coined in England in 
 limited quantities only. It is not a 'legal tender' for 
 sums over 40J. " 
 Reporter: 
 
 "What, then, are the practical disadvantages of 
 Monometallism ?" 
 Answer: 
 
 "The first and most obvious objection against a 
 Monometallic system of currency is that, it leaves the 
 standard of value open in the most unguarded way to 
 the operation of every influence that tends to deprive 
 it of stability. In a Monometallic system, the stand- 
 ard coin, whether it be of . gold or of silver, is necessa- 
 rily exposed to fluctuations in value which may be very 
 considerable and may easily lead tP mo^t ^erigus, and 
 even dJg^gtrpus, regujt?- 
 
21 
 
 "We have already seen that the value of a standard 
 gold or silver coin is simply the value of the metal of 
 which it is composed Now the value of each of the 
 precious metals, as of any other commodity, is open 
 to wide fluctuations. The value of either of them, 
 like the value of any other commodity, is determined 
 merely by the run of the market, the relation between 
 supply and demand. 
 
 "Now, Monometallism, as even the most extreme 
 Monometallists must admit, does nothing to exclude 
 this liability to fluctuation, or even to diminish it. 
 Take, for instance, the English gold Monometallist 
 currency. Gold, and consequently the sovereign, — 
 that is to say, the weight of gold contained in a sov- 
 ereign, — is liable to fluctuation in value, just as corn 
 is, or cotton, or cloth. Even the most extrenie Mon- 
 ometalist will allow that Monometallism does nothing 
 even to check that liability to fluctuation. 
 
 "Then there is a second point, the fuller explana- 
 tion of which may be reserved for a little further on. 
 
 "Monometallism, as we have it in Great Britain and 
 Ireland, in Germany, and in so many other countries, 
 tends to raise the value of gold, thereby favoring the 
 interests of all capitalists, the interests of all those 
 who have command of gold — money-lenders and the 
 like,r-favoring all such persons at the expense of the 
 generjEil community, and favoring also the interests of 
 all creditors, the interests of all who have a claim to 
 receive a fixed money payment from others, favoring 
 these at the expense of their unfortunate debtors." 
 
 Reporter: 
 
 "But, in. ^tjgland, for instance, where Bimetallism 
 was abandoned -in the early part of this century, no 
 
22 
 
 harm seems to have come of the change — at all events 
 until recently? No one seems to have complained?" 
 Answer: 
 
 "No, and for a very excellent reason. For, although 
 the change from Bimetallism to Monometallism was 
 made in England so far back as 1816, England did 
 not then feel the effects of the change, — nor indeed 
 were they felt anywhere,^or many years afterward. 
 
 "They were not, in fact, felt until 1873, when, con- 
 sequent upon the abandonment by Germany, and other 
 countries, of their former silver standard of currency, 
 • and their adoption of a gold standard, France, —and, 
 with France, the other countries of the Latin Union, 
 — followed the example which England had set 47 
 years before, and closed their Mints to the free coin- 
 age of silver, thus destroying the link between the 
 two metals and breaking down the very foundations 
 of the Bimetallic system. 
 
 "Until 18.73, then, the existence of Bimetallism over 
 the large area in which it was still maintained, prac- 
 tically saved the whole commercial world from feeling 
 the effects of Monometallism. So long as the Mints 
 of so many countries were kept open on Bfmetallist 
 principles, everything went on almost as before. 
 Reporter: 
 
 "But how could the maintenance of the system in 
 France and those other countries have affected the rela- 
 tive values of silver and gold elsewhere? How could it 
 have affected their relative values, for instance, in 
 England?" 
 Answer: 
 
 "In this way. Those who had, for example, silver 
 bullion to dispose of — saj', in England — would not 
 part with 18 or 20 ounces of it for an ounce of gold, 
 when by sending it to a public mint, in France, for 
 
23 
 
 instance, they could get as valuable an equivalent for 
 iSj^ ounces. 
 
 ' "Of course there was some little expense in the trans- 
 mission from London to Paris. This and other incidents 
 of the case, varied slightly from time to time. Hence 
 the maintenance of the Bimetallic system in France 
 and other countries did not, and could not, keep the 
 values of gold and silver at an absolutely fixed ratio 
 throughout the commercial world. But the fluctua- 
 tions in their relative value were so slight that the ratio 
 of their values was practically fixed at I5j4 to i. 
 
 "During all those years, the oscillations in the rela- 
 tive value of the two metals from the French legal ra- 
 tio of i5j^ to I were so slight that, as a rule, they did 
 not pass 15^ to i, on one side, or 15 J^ to i, on the other. 
 
 "Thus the fluctuations of value in the monetary 
 standard, not only in the countries of the Latin Union, 
 but elsewhere throughout the whole commercial world, 
 were reduced to a minimum. But in 1873 came the 
 disastrous change. The safety-valve that had been 
 kept open by the action of the French and other mints 
 was then screwed down. So the results of Monomet- 
 allism at once began to make themselves seriously felt 
 all around, and nowhere more seriously than in Ireland." 
 
 Reporter: 
 
 "What difference could it make, except, perhaps, 
 in the way of international trade between gold-using 
 and silver-using countries? 
 
 Answer: 
 
 "Even if it affected nothing else, the results might 
 be disastrous. See how it has affected the state of 
 trade between England on the one hand, and India, 
 and the other silver using countries of the East, on 
 the other. 
 
24 
 
 Take, for example, the great cotton manufacturing 
 industry of Lancashire. Lookfng into this matter in 
 detail a few days ago, I came across the following fig 
 uros. From February to August, 1890, the rupee- 
 which, as measured by the sovereign, used to count 
 practically as a two-shilling coin, but had then fallen 
 to IS., ^d., went up again in value to is. ^d. Then, 
 from August, 1890, to February, 1891, it fell from is. 
 qd. again to is. $d. In March last, the exchange 
 value of the rupee dropped so low as is. 2^d.; and 
 this was a fall of 2% per cent, within three days! 
 
 "As the case, then, was put by one of the speakers 
 at the ^ recent meeting in Manchester, at which Mr. 
 Balfour spoke, the rupture of the link which, until 
 1873, had kept the proportionate values of gold and 
 silver unchanged, has resulted in such violent and 
 continuous oscillations in the rate of exchange between 
 England and the East — that is to say, between the 
 standard gold coin, of England and the standard silver 
 coin of India, the sovereign and the rupee — as to re- 
 duce the cotton export trade of Manchester 'almost to 
 a game of chance, . . a gamble in silver, rather 
 than an investment in cottons.' 
 
 "And Sir David Barbour, in his Financial statement 
 for India, for 1891-92, says the same thing, almost in 
 the same words: — 
 
 " 'Trade between England and India was reduced to 
 mere gambling, the fluctuations in exchange being 
 so great as to more than counterbalance the effect of 
 the other elements which the trader, has to take into 
 consideration. 
 
 "It has even been said, with some truth, that at 
 one time it would have been better for the merchant to 
 dismiss his establishment, and confiine himself to specula- 
 
25 
 
 tions in silver; his expenses would have been less, and 
 his chances of profit quite as good as in his legiti- 
 mate business.' 
 
 "But this is not all. The merchant in India who 
 has to pay in rupees cannot afford to go on, year after 
 year, paying more and more rupees for the same quan- 
 tity of goods. 
 
 "For, we must remember, the present state of things 
 is the result of a rise in the value of gold rather than 
 of a fall in the value of silver. Prices, measured by 
 a silver standard of value — as they are measured in 
 India and the other countries of the East — have re- • 
 mained, we may say, unchanged. In India the rupee 
 has undergone practically no loss of purchasing 
 power. 
 
 "Whilst the Indian merchant, then — if he continues 
 to buy his goods in England — has to pay 14 or 15 ru- 
 pees, instead of 10, for every pound's worth, he can- 
 not raise the price to his retail consumers in India. 
 So that, unless the manufacturer in England can 
 reduce his' prices, and reduce them so as to cover by 
 the reduction the notable fall that has occurred in the 
 value of the silver rupee as measured by the sovereign 
 — which, of course, he cannot do without a heavy sac- 
 rifice of profits, perhaps even without a ruinous loss 
 — the Eastern merchant must give up buying in the 
 English market. 
 
 "Now this is what is actually going on from day to 
 day. Trade with the East is rapidly leaving England. 
 Take, for instance, these facts, stated in the speech 
 of Mr. J. A. Beith at the Manchester meeting, from 
 which I have already quoted: — 
 
 " 'Not only has our Eastern trade been retarded, but 
 
26 
 
 the practical refusal to take payments in the money of 
 the East except at an enormous discount, has diverted 
 the channels of trade; and .silver-using countries, such 
 as China, have felt themselves compelled to go past 
 Manchester, and to trade with silver-taking countries. 
 
 " 'Now the figures on this question are absolutely 
 appalling. 
 
 "'For ten years before this change came (in 1873), 
 Indian mills were in existence, and were working vig- 
 orously, and making progress in India; but during 
 the whole of that ten years they were practically able 
 ■ to export nothing. 
 
 "'In 1874, the total exports of yarn from the Indian 
 mills to China and Japan amounted to only 1,000,000 
 lbs. It was only in 1875, and when silver had fallen 
 ^d. per ounce, that the 1,000,000 lbs. of exports which 
 it had taken Indian mills nearly ten years to get up 
 to, at once expanded, as if in obedience to the wave 
 of an enchanter's wand, into 5,000,000 lbs. 
 
 " 'In 1880 there was a further fall of 5//. per ounce, 
 and, consequently, a further advantage to . the silver 
 of India and China, as compared with England ac- 
 cepting only gold payments, and so then, th* five 
 millions of exports from India became twenty-five 
 millions. 
 
 "'In 1885, another fall took place, and the twenty- 
 five millions became seventy-five millions. In 1889, 
 there was a further fall of 5^/. in silver, and the sev- 
 enty-five millions became 127 millions. In 1891 there 
 was still a further fall, and the 127 millions of exports 
 of yarn from India to China became 165 millions; so 
 that, in seventeen years, through the operation of this 
 cause chiefly, one million lbs. of yarn exports per an- 
 num had risen to 165 million lbs. per annum . . . 
 
27 
 
 ".'This means that India is now sending six times 
 as much as the United Kingdom sends to China and 
 Japan, and twice as much as the United Kingdom 
 sends to India, China and Japan together.'" 
 
 Reporter: 
 
 "Then England's loss seems to be India's gain?" 
 
 Answer: 
 
 "Unfortunately the loss is not even compensated for 
 in that way. I do not mean merely that the change in 
 the current of trade brings profit to a small section of 
 English and native capitalists who have invested in 
 Indian mills, rather than to the general population of 
 the country. That indeed is true, but, as regards In- 
 dian interests, there is a far more serious aspect of 
 the case. 
 
 "There is, in fact, no country in the world, not even 
 Ireland, in which the rupture of the link between 
 gold and silver has proved more disastrous in its re- 
 sults than it has proved in India. 
 
 For, it must always be borne in mind that India 
 has contracted heavy debts, the interest on which has 
 to be paid in gold. Whatever profits, then, an in- 
 creased activity of trade may have brought to India, 
 these are more than absorbed in providing for the loss 
 which India has to bear on the remittances of cash, 
 — that is to say, from India's having to pay more and 
 more rupees for the gold she has to send to England 
 and elsewhere, in payment of interest. 
 
 "In the Report of the Gold and Silver Commission 
 of 1888, the extent of the additional demand thug made 
 upon the Indian Government, that is, in other words, 
 upon the taxpayers of India, is made very plain by 
 the statement that the extra charge resulting from a 
 fall of even id. in the exchange — from the Rupee be- 
 
28 
 
 ing worth is. ^d. instead of is. dd. — amounts to the 
 enormous sum of 11,000,000 of Rupees for the year." 
 
 Reporter: 
 
 "That Commission, then, investigated the question 
 of Bimetallism?" 
 
 Answer: 
 
 "It was, I may say, appointed for that purpose. 
 The Commission was composed of twelve members. 
 They drew up a singularly interesting Report setting 
 forth all the accepted facts of the case, and setting 
 forth also, very fully, the arguments and counter-ar- 
 guments of Monometallists and Bimetallists on the 
 various facts adduced. That is the first part of the 
 Report. It represents the unanimous view of the Com- 
 mission. It was signed by the twelve members. 
 
 "Then come two supplementary Reports, one signed 
 by the Monometallists members of the Commission, 
 the other by the Bimetallists. But the first portion 
 of the Report, signed unanimously by all twelve might 
 be quoted in support of almost everything I have 
 stated to you, so far. 
 
 "As to the point we are here dealing with, I take 
 the following from that section of the Report which 
 was drawn up by the six Monometallist members of 
 the Commission : — 
 
 " 'There cannot be two opinions as to the very se- 
 rious effect which the continued fall in the gold price 
 of silver has had on the finances of the Government of 
 India. Unless expenditure be diminished, every ad- 
 ditional fall in the value of the rupee renders ad- 
 ditional taxation necessary if a deficit has to be avoid- 
 ed .. . 
 
 " 'We are fully impressed with a sense of the dif- 
 ficulties which surround the Indian Government, and of 
 
29 
 
 the serious questions to which any proposed additional 
 tax must give rise. 
 
 " 'It is not only the embarrassment which has al- 
 ready been caused to the Government of India that" 
 has to be borne in mind, but the impossibility of 
 foreseeing to what extent those embarrassments may 
 be increased, and their difficulty augmented by further 
 depression.' 
 
 "All this was written in October, 1888. TJien see 
 how things have been going since then. On the 31st 
 of last March, the following telegram, from its Cal- 
 cutta correspondent, appeared in The Times; — 
 
 " 'The continued and unprecedented fall in exchange 
 is causing universal consternation, and threatens to 
 paralyze all trade. 
 
 " "Much indignation is expressed at the apparent ap- 
 athy of the Home Government.' 
 
 "A few days afterward. The Times had the following 
 in a leading article: — 
 
 " "The unprecedented fall in the rupee is causing 
 . great concern to all connected with India. Oi] Fri- 
 day, our correspondent telegraphed that the feeling in 
 Calcutta was of 'universal consternation.' 'The evil 
 threatens,' he says, 'to paralyze all trades, and much 
 indignation is expressed at the apparent apathy of the 
 Home Government'. 
 
 "'That the position is very serious, and in some re- 
 spects disastrous is beyond dispute. . . 
 
 "'The Government of India finds itself saddled with 
 a currency that is the sport of circumstances over 
 which it has no control. 
 
 " 'The effect has been to increase tne burden of 
 its public debt, in sterling, by 50 per cent during the 
 past 28 years, quite apart from new borrowings; to 
 reduce large numbers of its servants to pecuniary dis- 
 tress; and to affect grain prices in a way which seems, 
 to some observers, to intensify every local failure o( 
 
30 
 
 the crops, and to threaten the poorer classes in India 
 with a chronic artificial scarcity of food." 
 
 "All this makes it very plain what a serious error 
 it would be to suppose that the loss in which the fluc- 
 tuation in the relative value of the rupee and sover- 
 eign has resulted in Lancashire has been made up for 
 by a gain to India. 
 
 "Then too, in India^ there has been another serious 
 drawback resulting from the present currenc)' arrange- 
 ments. As a result of the existing state of confusion, 
 it has become impossible for India to obtain the loans 
 that are absolutely necessary for the development of 
 the resources of the country. 
 
 "Here is a clear statement on this point: — 
 
 " 'The total mileage of railways in India is only 
 16,996 miles, many of the lines being only for strategic 
 purposes and practically useless for trade ; and the con- 
 stant cry, for years past, of British merchants, and of 
 those best acquainted with India's requirements, has 
 been *for great railway extensions. But the Indian 
 Government, whilst under successive Viceroys recog- 
 nizing these needs, has had to proceed with the work 
 on the smallest possible scale. 
 
 " 'The explanation is very simple. It is because the 
 Indian Government has to borrow the cost of con- 
 struction in gold, and the interest on the debt has to 
 be paid in gold, whilst, on the other hand, the reve- 
 nue of India is raised in silver. 
 
 " 'A fall in exchange, therefore, means that a larger 
 amount of silver has to be raised to pay the interest on the 
 gold debt. 
 
 " 'To take an extreme case. Suppose a loan ul 
 ;^io,ooo,ooo for an Indian railway had been raised 
 
31 
 
 when the rupee was at 2s. That would represent loo 
 millions of rupees; and at 4 per cent interest the In- 
 dian Government would have to pay the bondholders 
 4 millions of rupees per annum. 
 
 " 'With the rupee at about its present value, how- 
 ever — say IS. 4^/. the Govrenment would have to raise 
 and pay six millions of rupees per annum as interest, 
 an extra burden of 50 per cent on the material pros- 
 perity of India.' 
 
 Last March, The Times had a rather interesting 
 article on this aspect of tbe case: 
 
 " 'Powerful interests in England,' it said, 'demand 
 a more rapid development of railway communication 
 in India . . . On the other hand, the Government 
 wisely hesitates to impose on the Indian Exchequer 
 the responsibility for gold loans or obligations, which 
 it will have to discharge in a silver currency of van- 
 ishing value ... 
 
 " 'The truth is that railway development,, 
 like the development of every other branch of Indian 
 enterprise, is now awaiting some settlement as to the fut- 
 ure of the rupee. The currency difiSculty underlies the 
 whole situation:.^ 
 
 "In the work from which I quoted a few moments 
 ago there is a very pertinent remark about this rail- 
 way difficulty : 
 
 " 'At the present rate of exchange (between the 
 rupee and the sovereign, as compared with the old 
 rate of 2J-., or ten rupees to a sovereign), the loss to 
 the Indian Governemnt in remitting (to England) 
 interest on loans, &c., is estimated at about 8<j,ooo, 
 000 of rupees per annum. Now those eighty millions 
 of rupees, if they could be saved, would construct, 
 under ordinary conditions, about 1,500 miles of rail- 
 
32 
 
 ways per annum, without adding one penny to India's 
 present burden in either capital or interest ■ . . 
 
 " 'Every mile of railway constructed there facilitates 
 India's exports, and correspondingly makes a new or 
 a better market for English goods, and, by facilitating 
 foqd transports, enables us more effectively to provide 
 against the horrors of ever-recurring famines. 
 
 "A similar difficulty it seems exists in China. It is 
 now not so much 'Celestial' prejudice as exchange 
 difficulties, that stop the making of railways in that 
 country. Not long since tl»e Chinese Government en- 
 deavored to raise a loan for railway purposes. But 
 they would only raise it in silver, and have it payable 
 both as to capital and interest in silver. European 
 financiers, under the present monetary arrangements 
 of the commercial world, would not entertain the 
 transaction. 
 
 "India, of course, is loudly clamoring for the re- 
 moval of the difficulty in the only way in which itcan 
 really be removed, that is, by a revival of the former 
 Bimetallic currenc" arrangements which were departed 
 from in 1873. 
 
 "'But then, account has to be taken of the dogged 
 resistance- that indubitably will be offered to any such 
 measure of reform, by the capitalists, the money- 
 owners and the money-lenders of the world. It is 
 their interest to prop up the present system of currency. 
 That system, no doubt, in countless ways, grinds the 
 faces of the poor. But what matter? It is all to the 
 profit of the owners and holders of gold. So the 
 owners and holders of gold will hold on by it to the 
 death. 
 
 "It is little wonder, then, that in view of the tre- 
 mendous opposition sure to be offered by all such. 
 
33 
 
 persons, the re-establishment of Bimetallism should 
 have come to be looked upon as an almost Utopian idea. 
 Reporter: 
 
 "But then, what other remedy for the undeniable 
 and unquestionable evil of the present state of affairs 
 is to be looked for? 
 Answer: 
 
 "Apart from the re-establishment of Bimetallism, 
 the only other practical policy that has been proposed 
 ^and it has been proposed only as a remedy for the 
 special evils arising out of the difficulty about ex- 
 change between gold- using and silver-using countries, 
 such as England and India — is the adoption of a gold 
 standard for India. 
 
 "From a belief very generally entertained, that the 
 British Government is too far committed to Monomet- 
 allism to leave any immediate likelihood of its im- 
 mediately retracing its steps, the adoption of a gold 
 standard for India has been suggested. 
 
 "But the adoption of a gold standard for India is a 
 policy which even The Times — strongly Monometallist 
 as its present financial tendency is — shrinks from ad- 
 vocating. 'It is an alternative,' says The Times, 
 'fraught with financial difficulties, and with derange- 
 ments to the existing basis of Indian commerce and 
 manufactures, which any Government may well shrink 
 from encountering.'" 
 Reporte'K: 
 
 "But would it not seem a useful thing to bring 
 about a unity of monetary standard at all events be- 
 tween India and England, and possibly between all 
 ■gold-using' and all 'silver-using' countries?" 
 Answer: 
 
 "Yes; but how can it be done except through the 
 
34 
 
 restoration of Bimetallism? As for the adoption of a 
 gold standard for India, the result would be disaster 
 all around. This reference to the prospect of the 
 adoption, by India of a gold Monometallist currency, 
 brings us to the consideration of another grave result 
 of our present Monometallist system, — one of the very 
 gravest results of it, — a result far more widely ex- 
 tended, and far more calamitous in its influence, than 
 any of those which we have, so far, been consider- 
 ing. 
 
 "It is to be borne in mind, then, that money has to 
 serve, not merely as a medium of exchange in the 
 purchase of commodities, but also as a measure and 
 record of the extent of obligations in the case of all 
 deferred payments, or of payments extending over 
 long periods — as, for instance, the yearly payments of 
 rent or of the interest on a mortgage. 
 
 "Now it can hardly need to be pointed out that, so 
 long as contracts into which time enters as an element 
 are expressed in terms of money, it is of the utmost 
 importan,ce that the monetary standard should, as far 
 as possible, be stable in value. Absolute stability of 
 value is, as we have seen, unattainable. But, in its 
 absence, comparative stability is to be looked for, as 
 one of the first requisites in a monetary standard. 
 
 "As Mr. Barclay puts it, 'the value of money might 
 vary without much inconvenience if all transactions 
 were immediate exchanges in which money simply 
 prevented a resort to barter. But, aS we know, the 
 whole structure of trade is based on credit and time 
 contracts; and, . in view of this, the medium of ex- 
 change, which is also a standard of value, cannot vary 
 without inflicting serious injury either upon debtor or 
 creditor.' Stability of value, then, in so far as it is 
 attainable, is an all-important element of money. 
 
35 
 
 'Now it is in this point especially that our present 
 Monometallist system of currency is open to most se- 
 rious objection. 
 
 "Gold, as the result of a variety of causes, is stead- 
 ily and seriously increasing in value. And not merely 
 does Monometallism provide no check upon this in- 
 crease, but the increase itself is, in great part, the 
 result of the changes that have been made in so many 
 countries, in the direction of Monometallism, within 
 the last twenty years. 
 
 "The chief source of the notable rise that has taken 
 place in the value of gold is the heavy additional de- 
 mand which, from various causes, has fallen upon 
 gold during these later years. One of those disturb- 
 ing causes, for instance, was the closing of the French 
 and other European Mints in 1873 against the unre- 
 stricted coinage of silver. Another was the adop 
 tion, about the same time, of a gold standard of cur- 
 rency in Germany, and in several other countries 
 which, until then, had retained a silver standard. All 
 this led to an enormous extra demand upon gold, and 
 consequently to a very notable increase in the value 
 of gold. 
 
 "The necessary result of this increase in value is 
 that our present monetary standard of value has be- 
 come an altogether misleading standard. As gold be- 
 gan steadily to go up in value, every existing obliga- 
 tion to pay a fixed amount of pounds, shillings, and 
 pence, became more and more burdensome than be- 
 fore. 
 
 "This, then, told heavily against all debtors, and 
 gave an undue advantage to all creditors. 
 
 "As I have elsewhere made special reference to the 
 disastrous results of the change in the case of our 
 
36 
 
 Irish farmers, I ought not to omit to state that, from 
 another side, the landlord's interests have been affected 
 at least as seriously as those of the tenants. No class 
 in the community indeed has suffered morfe disastrously 
 from the change tnan the owners of land charged with 
 mortgages, as, unfortunately, the greater part of the 
 land of Ireland is charged to an oppressively burden- 
 some extent. 
 
 "But, within certain limits, this source of difficulty 
 exists, not only in Ireland, but in England also. 
 
 "'The landlords,' says Mr. Samuel Smith, "who 
 borrowed 400 millions on their property, agreeing to 
 pay, let us say, sixteen millions a year interest at 4 
 per cent, supposing that it represented one-fourth of 
 their rents, now find, owing to the fall of prices, that 
 it represents one-third, or even in some cases one-half, 
 of their rents. 
 
 "Then, manufacturers and traders, too, have suffered, 
 and suffered heavily. 'The factory owner,' continues 
 Mr. Smith, 'the mine-owner, the ship-owner, who 
 thought it safe twenty years ago to borrow half the 
 value of his plant in order to find capital for his 
 business, now finds that the mortgagee is the virtual 
 owner. Nearly all the profits go to pay the mort- 
 gagee's claim, and in many cases he has foreclosed and 
 sold out the unhappy borrower, ruined through no fault 
 of his own, but solely through the extraordinary sink- 
 ing of prices. . . 
 
 " 'As a matter of fact, I believe that if all the fixed 
 capital engaged in trade in England could be valued 
 to-day at its real selling price, it would be found that 
 it would do little more: than pay the mortgages and 
 debts upon it.' 
 
 "The following passage from the same writer is al- 
 
37 
 
 so well worth quoting. It brings out, very plainly, 
 another of the ways in which Monometallism has 
 worked mischief, by the depressing influence which 
 the increase in the value of gold has exercised upon 
 trade: — 
 
 "'Trade is very greatly and injuriously affected by a 
 sudden alteration in the standard of value, especially 
 when the alteration is, as now, toward an increased 
 value. 
 
 " 'It arises in this way. Trade is largely carried on 
 by borrowed capital, or, in other words, by the use 
 of credit in some shape or other; the vast banking 
 deposits are mostly lent to traders; a very great deal 
 of the invested capital of this country is lent upon 
 mortgage of trading property, such as ships, factories, 
 warehouses, &c. 
 
 " 'A prudent trader usually considers it safe to 
 trade considerably beyond his floating capital, and to 
 borrow, say, 50 per cent on the security of his plant 
 or fixed capital. Now the constant decline of prices, 
 the last few years, has virtually swept away his own 
 portion of the capital, and only left him enough to 
 pay the loans and mortgages. 
 
 '"For instance, a ship or a factory built at a cost 
 of _;^2o,ooo, of which _;£'io,ooo was borrowed, is now 
 worth only j£i2,ooo, or 40 per cent less; and so the 
 mortgage represents five-sixths of the value instead 
 of one half, the trader's interest having sunk to 
 _^2,ooo, in place of _;^io,ooo. Probably, if trade ig 
 unprofitable, he fails to pay the interest, and the 
 mortgage is foreclosed; the propert)' is forced off at 
 just sufficient to cover the loan, and he is ruined. 
 
 "'1 have no doubt that this process exactly describes 
 the condition of vast numbers of the traders of this 
 
38 
 
 country and of other countries having a gold stand- 
 ard. 
 
 "'A great portion of the commercial capital of the 
 country has passed into the hands of the mortgagees 
 and bondholders, who have neither toiled nor spun. 
 The discouragement this state of things produces is 
 intense. After it has gone on for several years, a 
 kind of hopelessness oppresses the commercial. com- 
 munity, all enterprise comes to a standstill, many 
 works are closed, labor is thrown out of employment, 
 and great distress is felt both among laborers and the 
 humbler middle class. Indeed, it strikes higher than 
 this; for multitudes of people who once were pros- 
 perous traders have now become dependent on charity. 
 I know many such myself.' 
 
 "Then the case of the National Debts and various 
 local and Other debts of the various nations of the 
 world furnish another instance of the evil resulting to 
 the general community from a rise in the value of 
 gold. 
 
 "As to the National Debt of England, Mr. S. Dana 
 Horton in his valuable work, 'The Silver Pound,' 
 calculates, on the basis of figures collecte'd by eminent 
 statisticians, that 'the National Debt, regarded as a 
 principal ^sum, has increased its weight upon the 
 shoulders of the British taxpayer between 1875 and 
 1885 by nearly 200 millions sterling, an amount nearly 
 equalling the Franco German war fine.' 
 
 "And we have to remember that, as regards espec- 
 ially National Debts, the national creditors are rep- 
 resented mainly by the capitalist and money-owning 
 classes, whilst the principal representatives of the 
 national debtors are those who labor in the fields, the 
 factories, or the mines. 
 
39 
 
 Reporter: 
 
 "In this way, then, the Irish farmers too have suf- 
 fered? 
 Answer: 
 
 "Yes, that is, those farmers who have rents fixed 
 under leases, or rents judicially fixed for 15 years, or 
 those who are under any such obligation of making 
 fixed payments from year to year. The case of the 
 tenant-purchasers under any of the Land Purchase 
 Acts is one of special hardship. In their case, the 
 obligation of the annual payments extends over, not 
 merely 15, but 49 years. 
 
 'Here is where the difficulty comes in. In all such 
 cases, the farmer is under the obligation of paying, 
 year after year, an amount specified in pounds, shill- 
 ings, and pence. But then this rent, or other annual 
 payment which he has to make, though it is thus 
 specified in amount, is really increasing, that is to 
 say, becoming more burdensome from year to year. 
 
 "To bring the matter to a point, it comes to this, 
 that, year after year, more corn, more hay, more cat- 
 tle, have to be sold by the farmer to enable him to 
 get the gold which is required to meet that annual 
 payment. 
 
 , "But, of course, if he has not more, corn, more hay, 
 or more cattle to sell, he cannot, out of what he has 
 to sell, get enough to enable him to make that pay. 
 ment. 
 
 "And, plainly, the longer the term for whicn his 
 'fixed' annual payment has to be made the more dis- 
 astrous must the results be to him." 
 Reporter: 
 
 "Then the foreign competition, of which we hear so 
 much, is not the sole cause of the ruinous fall in ag- 
 ricultural prices?" 
 
4° 
 
 Answer: 
 
 "No. It is, no doubt, one element in the case. 
 But, as everything goes to show, the main cause of 
 the ruinous fall in agricultural, as in other prices, is 
 the continuous increase in the value of gold — the 'ap- 
 preciation' of gold, as that increase in value is called 
 in the jargon of the political economists. 
 
 "Now this brings us to the point in Mr. Balfour's 
 Manchester speech, to which I would specially direct 
 attention. 
 
 "Money,' said Mr. Balfour, "has to serve, not merely 
 as a medium of exchange, but also as a 'fair and per- 
 manent record of obligations extending over long pe- 
 riods of time.' In this, which he rightly called a 
 'great and fundamental requirement,' our existing cur- 
 rency, as he declared with emphasis, ' totally and la- 
 mentably fails.' 
 
 "To make good this statement, Mr. Balfour pointed 
 out that the gold monetary standard of Great Britain 
 and Ireland has, in some 15 or 16 years, gone up in 
 value no less than 30 or 35 per cent; and he went on 
 to say that, of its further progressive appreciation, 
 or rise in value 'wi? man living can prophecy the limits.^ 
 
 Again he spoke of the increase in value of our 
 present Monometallist gold standard of value as pro- 
 gressing steadily continuously indefinitely.' 
 
 "As to the result of all this upon the community 
 generally, Mr. Balfour expressed himself as follows: — 
 
 " 'If you will show me a system which gives . . . 
 absolute permanence, I will take it in preference to 
 any other. But of all conceivable systems of currency, 
 that system is assuredly the worst, which gives 
 you a standard steadily, continuously, indefinitely ap- 
 preciating, and which by that very fact throws a bur- 
 
41 
 
 den upon every man of enterprise, upon every man 
 who desires to promote the agricultural or the in- 
 dustrial resources of the country, and benefits no human 
 being whatever but the owner of fixed debts in gold.' 
 
 "But this was nothing new. Mr. Balfour's views 
 were on record, years before. There is a highly im- 
 portant statement from him, and from five other mem- 
 bers of the Royal Commission, the Gold and Silver 
 Commission, of 1887 
 
 "In the special Report drawn up by the six-Bimet- 
 allist members of that Commission — including Mr. 
 Balfour and Mr. Chaplin, two members of the late 
 Cabinet — a distinct reference is made to the question 
 of rents. Speaking of 'leases for long terms of years 
 annuities, pensions, and other similar charges,' they 
 say that 'with every rise in the value of gold, the 
 weight of this burden upon the industry of the country in- 
 creases. ' 
 
 "What a prospect this is for Irish tenants with 'ju- 
 dicial' rents fixed for 15 years, or for tenant-purchasers 
 with their annual paj'ments to the Government fixed 
 for the next 49 years! 
 
 "As I am speaking of Mr. Balfour, it may be inter- 
 esting to note that his Irish Land Purchase Act con- 
 tains a very eifiicent, if somewhat elaborate, provision 
 for the protection of the State against loss, in the 
 event, by no means unlikely, of the purchasing tenant 
 breaking down in his payments before the 49 years 
 are out. 
 
 "In the scheme embodied in Mr. Balfour's Purchase 
 Act, the purchasing tenant has to begin by paying at 
 an extra rate for a number of years, so as to build 
 up a substantial guarantee fund for the State. 
 
 "No wonder, indeed, that Mr. Balfour, Bimetallist 
 
42 
 
 as he is, should have clearly seen the necessity for 
 some such provision. By most people it seems to 
 have been looked upon as a mere superfluity of com- 
 plication. 
 
 "Mr. Balfour, however, was in a position to see, 
 what, of course, the general public were wholly un- 
 aware of, that a payment which a purchasing tenant 
 may now be in a position to make — or which he may 
 be in a position to make for the next few years — may 
 be altogether beyond his reach in probably lo or 12 
 years to come. Putting on the screw for the first few 
 years, then, is good policy. If it is not good for the 
 tenant, it is good for the State. Whatever may be- 
 fall the unfortunate tenant-purchaser, the State at 
 all events is somewhat safeguarded. It has a bet- 
 ter chance of getting back the money it has advanced. 
 
 "As for the tenant-pucrhaser he probably thinks that 
 after the extra pressure of the first few years he may 
 look forward to easy times for the rest of his life. 
 He little knows what is before him. If things go on 
 as they are it will be harder for him 10 or 12 years 
 henee to pay j£/^o a year than it would be for him to 
 pay ^50 a year now. But of all this he knows noth- 
 ing. How could he? His only idea is that a pound 
 is always a pound, a sovereign always a sovereign. 
 So, in the belief that the yearly payment, when it is 
 reduced to, ^40, will be well within his reach, he 
 puts his head into the halter. 
 
 "But we must be fair. No one can say that Mr. 
 Balfour used his general knowledge of the financal 
 situation to entrap the tenants unawares. He did 
 nothing of the kind. If they did not know what was 
 before them, they cannot blame Mr. Balfour for it. 
 He never concealed his views. He did not fail to 
 
43 
 
 give them plain warning of the consequences of enter- 
 ing into prolonged obligations for the payment of 
 fixed amounts. 
 
 "What he said quite recently'at the meeting in Man- 
 chester is, perhaps, in one sense, somewhat more ex- 
 plicit; but it is not in any way different in sense or 
 substance from what he had said, years before, in the 
 most formal and public way, m the Report of the 
 Gold and Silver Commission of 1888. 
 
 "I have thought it important to call attention to 
 the published statements of Mr. Balfour's views on 
 this matter. His position as a prominent politician, 
 especially in view of his recent official connection 
 with Ireland, makes them of special interest. But they 
 are in no way different from those expressed' by many 
 others who have written or spoken on the subject. 
 
 "Mr. Samuel Smith, for instance, in an essay on 
 'The Sufferings caused by the Appreciation of the 
 Gold Standard,' calls special attention to the increas- 
 ing burden thrown upon agricultural tenants by the 
 maintenance of the present Monometallic system. He 
 speaks more especially of the Irish tenants, in view 
 of the fact that so many of them are in the embar- 
 rassing position of having rents judicially fixed for 15 
 years. 
 
 "This aspect of the case is brought out forcibly also 
 by the Belgian economist, Emile de Laveleye: — 
 
 "'This consideration,' he says, 'especially affects 
 Ireland . 
 
 " 'If you can let tenants hold their land for nothing, 
 it would be all right; but if they have to, pay a fair 
 rental either to landlords or to the Governments, or to 
 purchase at a fair price, they must then sell produce 
 so as to procure the amount requisite for purchase or 
 for a fair rent. 
 
44 
 
 " 'If the price of this produce is very low, and is 
 falling still lower, then the tenants will be incapable 
 of raising the required sum, and it will be necessary 
 to evict them . . . or to cancel their debts. 
 
 " 'The supply of gold being wholly insufficient, a 
 fall in prices must ensue; hence the ruin of Irish cul- 
 tivators, in spite of Home Rule. 
 
 "So far, then, for the chief source of the evils of 
 our present Monometallist system, and the wide field 
 throughout which the calamitous influence makes it- 
 self felt. It remains only to point out in what way 
 Bimetallism provides a safeguard against these mani- 
 fold evils — " 
 
 Reporter: 
 
 "But, first, as to the fundamental fact, the rise in 
 the value of gold. What do the Monometallists say 
 as to the existence of an extra demand upon gold, and 
 a consequent rise in its value?" 
 
 Answer: 
 
 "That, no doubt, is a point of much importance, 
 especially in view of the disastrous bearing of the 
 present currency system upon Irish farmers. 
 
 "For a long time, the truth of the proposition so 
 emphatically proclaimed by the Bimetallists — that the 
 pressure upon the existing supply of gold was increas- 
 ing, and that gold, consequently, was increasing in 
 value — was disputed by Monometallists. 
 
 "If, indeed, the Monometallists, at the outset, were 
 committed to anything, they were committed to this, 
 that there was no serious difficulty about gold — that 
 is, in other words, that there was no embarrassing ex- 
 tra demand upon gold in relation to the existing sup- 
 ply of it — and that, consequently, the present general 
 
45 
 
 fall in prices should be ascribed, not to a change in 
 the value of the metal which forms our only standard 
 of value,' but to an indefinite number of other causes, 
 happening, somehow, all of them, to work together 
 in the same direction. Silver, they said, was going 
 down in value. Other commodities, generally, were 
 going down in value. But gold, they maintained, was 
 practically steady. 
 
 "Now, however, there are not many intelligent Mono- 
 metallists who would care to identify themselves with 
 the maintenance of such statements. 
 
 "No Bimetallist, indeed, has written more conclu- 
 sively in refutation of the old Monometallist view upon 
 this fundamental point than Mr. Giffen, the well- 
 known Chief of the Statistical Department of the 
 Board of Trade, probably the most determined and un- 
 compromising champion of Monometallism in Eng- 
 land. 
 
 "In a statistical paper of exceptional interest, read 
 by Mr. Giffen before the Royal Statistical Society in 
 London, in 1888, he not merely accepted, but pro- 
 claimed with marked emphasis, the proposition that 
 gold had notably gone up in purchasing power; that 
 the increase was continuing, and was likely to contin- 
 ue; and that this increase in the purchasing power of 
 gold gives the true explanation of the fall in the price 
 of commodities generally. 
 
 "Mr. Giffen, indeed, in that paper, was not satisfied 
 with dealing with the state of things as they were then 
 found to exist. He claimed, and apparently not with- 
 out justice, that a prediction of his in this matter had 
 come true. 
 
 "In a former paper, read in 1879, he had, he said, 
 pointed out the likelihood that a rise in the purchas- 
 
46 
 
 ing power of gold would soon become evident, and he. 
 had said that if this were to occur, there were sufH 
 cient facts in the diminished supply of gold, and in- 
 the increased demands upon gold, to account for the 
 increase in its purchasing power. 
 
 "Then, in his paper of 1888 he went on to say: — 'If 
 the test of prophecy be the event, there was never 
 surely a better forecast. The fall of prices in such a 
 general way as to amount to what is known as a rise 
 in the purchasing power of gold, is generally — I might 
 almost say, universally — admitted. 
 
 " 'Measured by any commodity, or group of com- 
 modities, usually taken as the measure for such a pur- 
 pose, gold is undoubtedly possessed of more purchas- 
 ing power than was the case 15 or 20 years ago, and 
 this high purchasing power has been continued over 
 a long enough period to allow for all minor oscilla- 
 tions.' , 
 
 "In the same paper, Mr. Giffen deals very fully 
 with the evidence of all this, furnished by the statis- 
 tics of the fall in prices of the leading commodities. 
 The comparison is worked out by a well-known methr 
 od, that of 'Index- numbers.' 
 
 "An 'Index-number' is a device to enable an average 
 to be struck of the prices of a great number of arti- 
 cles. 
 
 "There are several sets of such numbers, worked 
 out by statisticians, and brought up to date each year. 
 The Economist newspaper gives a set based upon the 
 wholesale price of 22 of the principal articles in the 
 London Market. An eminent statistician, Mr. A. 
 Sauerbeck, has worked out a set upon a far broader 
 basis, 45 articles being included. 
 
 "Here is a Table showing the almost continuous 
 
47 
 
 fall in the wholesale prices of commodities, as rep- 
 resented by the 45 principal commodities comprised 
 in Mr. Sauerbeck's computation. I give the Index- 
 numbers of Mr. Sauerbeck's Table, from 1874 to 
 1892: — 
 
 Years 
 
 Mr. Sauerbeck' s 
 Index-numbers for 43 
 principal Commodities 
 
 1874 
 
 102 
 
 1875 
 
 96 
 
 1875 
 
 95 
 
 1877 
 
 94 
 
 1878 
 
 87 
 
 1879 
 
 83 
 
 188a 
 
 88 
 
 188 1 
 
 85 
 
 1882 
 
 84 
 
 1883 
 
 82 
 
 1884 
 
 76 
 
 1885 
 
 72 
 
 1886 
 
 69 
 
 1887 
 
 68 
 
 i888 
 
 70 
 
 1889 
 
 72 
 
 1890 
 
 72 
 
 1891 
 
 72 
 
 1892 
 
 68 
 
 "In the Report of the Gold and Silver Commission 
 of 1888, Mr. Sauerbeck's Index-numbers are given in 
 an ingenious arrangement, the average of the numbers 
 for a continuous period of 10 years being given from 
 year to year. The following is a section of the Table, 
 commencing with the period of 10 years which has 
 for its middle point the beginning of the year 1874: — 
 
48 
 
 For the period 1869-78, average of the ten yearly numbers, 99 
 
 1870-79 
 ,1871-80 
 1872-81 
 1873-82 
 1874-83 
 1875-84 
 1876-85 
 1877-86 
 1878-87 
 
 97 
 96 
 
 95 
 93 
 90 
 87 
 
 85 
 82 
 79 
 
 "This may be a convenient place to mention that 
 Mr. Sauerbeck has worked out also the yearly Index- 
 numbers of the price of silver. These numbers are in- 
 structive under two aspects. First, they show the 
 remarkable steadiness in the gold price of silver so 
 long as the Bimetallic system of the Latin Union was 
 in operation, as contrasted with the notable fall that 
 has since taken place. Secondly, they bring into 
 marked prominence the wonderful similarity between 
 the fall in the gold price of commodities in general, 
 and the fall in the gold price of silver. 
 
 "To bring out this second point, it is enough to 
 tabulate the respective Index-numbers for the years 
 from 1874 to 1892. But to bring out the first point, it 
 is necessary to take two periods, one preceding, the 
 other following, the year of the disastrous change. 
 
 "The following Table, then, sets forth, by means of 
 Mr. Sauerbeck's Index-numbers, the striking contrast 
 between the relative value of gold and silver in the 
 years preceding, and in the years following, 1873. 
 
49 
 
 Years 
 
 Yearly 
 
 Yearly 
 
 Years 
 
 from 1873 
 
 Index-numbers 
 
 Index-numbers 
 
 from 1873 
 
 back to 1854. 
 
 of Silver 
 
 of Silver 
 
 on to 1892. 
 
 1873 
 
 97-4 
 
 97-4 . 
 
 1873 
 
 1872 
 
 99.2 
 
 95-8 
 
 1874 
 
 1871 
 
 99-7 
 
 93-3 
 
 1875 
 
 1870 
 
 99.6 
 
 86.7 
 
 1876 
 
 1869 
 
 99.6 
 
 90.2 
 
 1877 
 
 1868 ■ 
 
 99.6 
 
 86.4 
 
 1878 
 
 1867 
 
 99-7 
 
 84.2 
 
 1879 
 
 1866 
 
 100.5 
 
 85-9 
 
 1880 
 
 1865 
 
 100,3 
 
 8j.o 
 
 188 1 
 
 1864 
 
 looig 
 
 84.9 
 
 1882 
 
 1863 
 
 lOI.I 
 
 83.1 
 
 1883 
 
 1862 
 
 100.9 
 
 833 
 
 1884 
 
 1861 
 
 99-9 
 
 79-9 
 
 1885 
 
 i860 
 
 101.4 
 
 74.6 
 
 1886 
 
 1859 
 
 102.0 
 
 73-3 
 
 1887 
 
 1858 
 
 lOI.O 
 
 70-4 
 
 1888 
 
 1857 
 
 IOI.5 
 
 70.2 
 
 1889 
 
 185& 
 
 lOI.O 
 
 78.4 
 
 1890 
 
 1855 
 
 100.7 
 
 74-1 
 
 1891 
 
 XSS4 
 
 lOI.I 
 
 65.4 
 
 1892 
 
 "Taking, then, the two equal periods of 19 years, 
 one preceding 1873, the other subsequent to that year, 
 we find that in the former period, during which the 
 Bimetallic sygtem of the Latin Union was in opera- 
 tion, the extreme range of the gold price of silver 
 lay between 102.0 and 99.2; whilst, throughout the 
 period following the abandonment of that system in 
 1873, there has been a persistent fall, the Index-num- 
 bers ranging down through the nineties, the eighties, 
 and the seventies', and reaching at length to the low 
 
 figure of 65.4. 
 
 "The contrast between the practical stability of the 
 gold price of sliver during the period preceding 1873, 
 and its utter instability since then, may be exhibited 
 in perhaps a still more striking form by indicating. 
 
so 
 
 for each year, the difference by which the Index-num- 
 ber of the price of silver for the year exceeded, or fell 
 short of, I GO. 
 
 "This is shown in the following Table: — 
 
 19 Years preceding 1873. 
 
 19 Years following 1873. 
 
 Years 
 
 Difference between 
 
 the yearly 
 
 Index-number of 
 
 Silver and 100 
 
 Difference between 
 
 the yearly 
 
 Index-number of 
 
 Silver and 100 
 
 Years 
 
 1872 
 1871 
 1870 
 1869 
 1S6S 
 1867 
 1866 
 1865 
 1864 
 1863 
 1862 
 1861 
 1860 
 1859 
 1858 
 1857 
 1856 
 1855 
 1854 
 
 — 0.8 
 
 — 0.3 
 
 — 0.4 
 
 — 0.4 
 
 — 0.4 
 
 — 0.3 
 + 0.5 
 + 0.3 
 + 0.9 
 + 1.1 
 + 0.9 
 -0.1 
 + 1.4 
 + 2.0 
 + 1.0 
 + 1.5 
 + 1.0 
 + 0.7 
 + 1.1 
 
 — 4.2 
 
 — 6.7 
 
 — 13.3 
 
 — 9.8 
 
 — 13.6 
 
 — 15.8 
 
 — 14.1 
 
 — 15.0 
 
 — 15.1 
 
 — 16.9 
 
 — 16.7 
 
 — 21.1 
 
 — 25.4 
 
 — 26.7 
 
 — 29.6 
 
 — 29.8 
 
 — 21.6 
 
 — 25.9 
 
 — 34.6 
 
 1874 
 1875 
 1876 
 1877 
 1878 
 1879 
 1880 
 1881 
 1882 
 1883 
 1884 
 1885 
 1886 
 1887 
 1888 
 1889 
 1890 
 1891 
 1892 
 
 "Then the wonderful similarity — allowance being 
 made for the inevitable slight divergence in detail — 
 between the fall in the gold price of silver and the 
 fall in the gold price of commodities in general, is 
 shown in the following Table. 
 
 "This Table gives, in parallel columns, for the years 
 1874-92 (i) the Index-numbers for the 45 commodi- 
 
51 
 
 ties comprised in Mr. Sauerbeck's coinputation, and 
 (2) the Index-nunibers of silver for the same years: — 
 
 
 Mr. Sauerbeck' 
 
 s Index-numbers 
 
 Years 
 
 
 
 Index-number of 
 
 Index-number of 
 
 
 45 Principal 
 
 SUver 
 
 
 Commodities 
 
 
 1874 
 
 102 
 
 95.8 
 
 1875 
 
 96 
 
 93.3 
 
 1876 
 
 95 
 
 86,7 
 
 1877 
 
 94 
 
 90.2 
 
 1878 
 
 87 
 
 86.4 
 
 1879 
 
 83 
 
 84.2 
 
 1880 
 
 . 88 
 
 85.9 
 
 1881 
 
 85 
 
 8^9 
 
 1882 
 
 84 
 
 1883 
 
 82 
 
 83!l 
 
 1884 
 
 76 
 
 83.3 
 
 1885 ' 
 
 72 
 
 79.9 
 
 1886 
 
 69 
 
 74.6 
 
 1887 
 
 68 
 
 73.3 
 
 1888 
 
 70 ~ 
 
 70.4 
 
 1889 
 
 72 
 
 70.2 
 
 1890 
 
 72 
 
 78.4 • 
 
 1891 
 
 72 
 
 74.1 
 
 1892 
 
 68 
 
 65.4 
 
 "It is sufficient to note that, in one case, the Index-, 
 numbers show a fall from 102 to 68, and, in the 
 other, a fall from 95 to 65. What more striking evi- 
 dence could be looked for, that the fall, all round, is 
 the result, not of causes' affecting merely the prices 
 of commodities on the one. hand, nor of causes affect- 
 ing merely the price of silver on the other, but of 
 the one cause that influences bcith alike; that is to 
 say, a progressive increase of value in the standard, 
 gold, in reference to which the prices, whether of 
 commodities or of silver, are stated? 
 
 "Returning to Mr. Giften's paper, I should not omit 
 to remark that .he puts very plainly the inevitable; 
 
52 
 
 effects of the fajl in prices — or, in other words, the 
 inevitable effects of the rise in the purchasing power 
 of gold — which is thus disclosed. 
 
 " 'It is obvious,' he says, 'beyond all question, that 
 these effects may be important. . . The weight of 
 all permanent burdens is increased as compared with 
 what would have been the case if there had . been no 
 appreciation. 
 
 " 'People in paying annuities, or old debts, have to 
 give sovereigns — which each represent a greater quan- 
 tity of commodities, .a greater quantity of the results- 
 of human energj', than it would have represented if 
 there had been no appreciation. . 
 
 "' The debtors pay more than they would otherwise 
 pay, and the creditors receive more. . . Apprecia- 
 tion' — that is, in other words, an increase in the value, 
 or purchasing power, of the standard coin — 'is a most 
 serious matter to those who have debts to pay.' 
 
 "Mr. Giffen then went on to speculate as to the 
 future. "I am,' he said, 'bound to say that all the 
 evidence seems to me to point to a continuance of the 
 appreciation. . . It is impossible to suppose that 
 the movement (for the adoption of a gold standard of 
 currency) will not extend to other countries. . . All 
 these facts point to a continued pressure on gold. , . . 
 The better probability seems to be that the increase of 
 the purchasing power of gold will continue from the pres- 
 ent time.^ 
 
 "Here, in fact, we have, in another form, the state- 
 ment made by Mr. Balfour in his recent speech in 
 Manchester. Mr. Balfour spoke of our present gold 
 standard of value as having gone up in value ''no less 
 than 30 or 35 per cent in some 15 or 16 years;" and 
 again he says of it that it still is 'steadily, continu- 
 
53 
 
 ously, and indefinitely' increasing in value, so that 'ijo 
 man living' can 'prophecy the limits to which the in- 
 crease may not extend. 
 
 "It is true that, about a year after the publication 
 of the important paper from which I have been quot- 
 ing, Mr. Giffin — taken aback, the Bimetallists say, 
 by discovering the extent to which his statistical pa- 
 per had strengthened their hands in the currency con- 
 troversy — wrote a paper in the Nineteenth Century in 
 a diametrically opposite sense. But no one seems to 
 have taken that paper seriously. Mr. Giffen, so far 
 from giving any reasons tor his astounding change of 
 front, did not even write as if he was aware that he 
 was making any change of front at all. He simply 
 struck out in a diametrically opposite direction, ig- 
 noring all that he had said in his statistical paper, 
 all the facts and figures that he had marshalled in that 
 paper with such logical force. 
 
 "Mr. Giffen's paper in the Nineteenth Century, was 
 not a statistical paper in any sense. It was simply 
 a disquisition on the currency question on grounds of 
 abstract political economy. Now Mr. Giffen is a sta- 
 tistician, and not a political economist. In his paper, 
 then, in the Nineteenth Century, he propounds, as 
 might have been expected, some sensationally novel 
 views. He does not even seem to have been aware of 
 their novelty. 
 
 "Professor Nicholson showed up all this, in triumph- 
 ant fashion, in the next number of the Nineteenth 
 Century, and, so far as I know, Mr. Giffen has never 
 even attempted to reply. His expedition into the 
 realms of political economy has ended, in fact, in a 
 lamentable collapse. 
 
 "But, whatever fate may befall Mr. Giffen's philo- 
 
54 
 
 sophical ventures/his statistical paper of 1888, on the 
 appreciation or increase in purchasing power, of gold, 
 and the disastrous effect of this increase upon all who 
 have debts to pay, holds its ground. I understand 
 that he has omitted that paper frorn a volume of his 
 essays collected for republicatiion. It would be much 
 more to the point if he were to endeavor to neutralize 
 the effect of it — in the supposition that he is in a po- 
 sition to do so — by pointing out any error he had dis- 
 covered in it, either in his statement of the statistics 
 of the case, or in his inferences from them. 
 
 "So long as that paper stands unrefuted by Mr. 
 Giffen himself, he must submit to be claimed as a 
 prominent witness to the facts upon which Bimetal^ 
 lism is based. 
 
 "Mr. Giffen, in his statistical paper of 1888, refers 
 exultantly, as I have mentioned, to a previous paper 
 written by him nine yfears before. An^ interesting 
 point connected with that earlier paper of his is the 
 important reference made to it by Mr. Goschen in a 
 convincing address, delivered before the Institute of 
 Bankers in 1883. 
 
 "Mr. Goschen, I should observe, is not in any sense 
 of the word a Bimetallist ; that is, he has not as yet 
 in any way declared himself in favor of Bimetallism. 
 He seems indeed to have some hesitation in taking 
 sides, one way or the other. But nothing could be 
 more explicit than his statements as to the increase 
 in the purchasing power of gold, and nothing could 
 be more lucid than his account of the causes that have 
 led to that' increase. 
 
 "In his address delivered in 1883 he went into this 
 matter in full detail. He showed how, in the years 
 from 1873 to 1883, whilst the annual supply of gold 
 
55 
 
 had fallen off to a most notable extent, the demands 
 upon the existing stock of gold in the world, espec- 
 ially from the substitution of a gold currencj' for a 
 silver currency in Germany and other countries had 
 enormously increased. 
 
 "The facts dealt with by Mr. Goschen in that ad- 
 dress are very clearly summed up by Mr. Samuel 
 Smith in the interesting volume from which I have so 
 often quoted. 
 
 " 'The gold production, he says, "which for some 
 years exceeded 30 millions annually, has fallen to 19 
 millions a year; and the best continental authorities, 
 such as Soetbeer and Laveleye, reckon that more than 
 half that amount is consumed in the arts. It may, 
 therefore, be reckoned that, since 1873, only some 10 
 millions of gold, on the average, has been available 
 for currency purposes. 
 
 " 'But Germany during that period has introduced a 
 gold curreny of So millions ; the United States . . . 
 has used up 100 millions ; and Italy has drawn some 
 20 millions for a similar purpose. So that 200 mil- 
 lions have been withdrawn for these special purposes, 
 whereas the whole supply of new gold for coinage has 
 not exceeded, in that time, 130 millions. The balance 
 must have been drawn out of existing stocks. Besides, 
 a steady drain of some 4 millions a year has gone to 
 India, further depleting the stock in Europe. . . . 
 
 " 'While trade and population constantly grow and 
 demand more metallic currency, there is a steadily 
 diminishing quantity to meet it. 
 
 " 'If we put the present production of gold at 19 
 millions a year, and the requirements of the arts at 8 
 to 10 millions a year, while the ordinary Indian de- 
 mand is 4 millions, there is only left 5 to 7 milljons 
 
56 
 
 a year for new coinage, for Europe, America and the 
 British Colonies. 
 
 '• 'It will seem to subsequent ages the height of folly 
 that, just at this period, when gold was running short, 
 the chief States of the world decided to close their 
 Mints against silver, and cut off, so to speak, one- 
 half the money supply of the world from performing 
 its proper functions. . . . 
 
 " 'Had the world continued to use both metals as 
 freely as before, the painful crisis we have passed 
 through would have been much mitigated. But by a 
 suicidal policy, silver was cut off at the very time 
 when it was most needed, and a double burden thrown 
 upon gold just when it was only able to bear half its 
 former burden. 
 
 " 'As Bismarck has well said, two men were strug- 
 gling to lie under a blanket only big enough for one.' 
 
 'It would be a grave omission here not to quote 
 Mr. Goschen's further remarks as to the inevitable 
 further increase in the value of gold— the result of 
 not merely a continuance, but a growth, of the pres- 
 ent exhausting demand upon it. 
 
 "Mr. Goschen's treatment of this aspect of the case 
 is all the more valuable from its forestalling a diffi- 
 culty which is not at all unlikely to occur to those who 
 enter upon the examination of the currency question 
 without being very fully informed upon the nature of 
 financial operations as they are carried out on an ex- 
 tensive scale in the great money markets of the world. 
 
 "'If it be true,' says Mr. Goschen, 'that population 
 continually increases, and that there is a certain in- 
 crease in wealth, an additional amount of circulation 
 will be necessary in order to meet the increased de- 
 mand, unless there are compensating counter econo- 
 
s; 
 
 mies by the extension of the cheque system and other 
 methods. 
 
 " 'Now, on the one hand, yon undoubtedly have in- 
 creased population. Going back thirty years, you may 
 say you have an addition to the population of 50 pej 
 cent, including not only the gold using countries of 
 the old world, but new countries, such as Australia 
 where the population increases fast. 
 
 " 'You also have an increase of wealth. Then, again ^ 
 you require more gold for more transactions. . . . 
 
 " 'Let us now consider, on the other hand, whether 
 
 the economies in the use of gold have been so great 
 
 as the increase in the population, and as the increase 
 
 ■ in the amount of gold required to liquidate the balance 
 
 of transactions. 
 
 " 'Mr. Giffen, in an article . . . printed in the 
 Journal of the Statistical Society for March, 1879, ex- 
 presses the opinion that the United Kingdom was 
 thoroughly 'well banked' even 20 years ago, and that 
 there have been no new devices invented during the 
 last 20 years which have much ecoftomized the use of 
 gold in the United Kingdom. We have already, I be- 
 lieve, reduced the use of gold in this country almost 
 to a minimum; and I am confirmed in this view by 
 the statement that the total circulation of gold in 
 England increased, according to the estimate of the 
 authorities of the Bank of England, from ;^io3,ooo,- 
 000 to _;^i24,ooo,ooo between 1870 to 1880. 
 
 " 'This would mean — and it is a most significant fact 
 — that in this country which is so 'well banked,' to 
 use Mr. Giffen's phrase, ;^2o,ooo,ooo more circulation 
 was nevertheless required in 1880 than in 1870. 
 
 ■"What a pull must those ^^'ao, 000, 000 have been 
 on the total supply of gold, after, or concurrently with, 
 
58 
 
 those other demands to which Ihave called yoiif at- 
 tention. 
 
 " 'As regards England, then, I do not see that there 
 has been any economy in the use of gold to counter- 
 balance the increasing demand of the population, nor 
 are we aware that in France or Germany, or elsewhere, 
 the economies have been such as to counterbalance the 
 increasing demand for gold." 
 
 Reporter: 
 
 "And as to the effect of all this upon prices?" 
 Answer: 
 
 "That was the main topic of Mr. Goschen's address. 
 
 "In that address, he makes good by every possible 
 line of argument that gold has risen, that it is rising, 
 and that, in all probability, it will continue to rise, 
 in value. He explains, moreover, that this increase 
 in the value of gold is the true explanation of the 'fall 
 in prices,' which had become unmistakably evident 
 even at the time of the delivery of his address, in 1883. 
 
 "After working out all this in detail, Mr. Goschen 
 adds the curiously significant remark that "some writers 
 have appeared to show something approaching to ir- 
 ritation at the view that the situation of gold should 
 have largely influenced prices.' 'I scarcely,' he says, 
 'know why, unless through the apprehension that the 
 Bimetallists may utilize the argument.' 
 
 "This, written six years beforehand, forms an in- 
 structive commentary on Mr. Giffen's odd change of 
 front. 
 
 "And then Mr. Goschen adds: — "I must repeat that, 
 to rii}' mind, the connection between the additional 
 demand for gold and the position of prices, seems as 
 
59 
 
 sound in principle as I believe it to be sustained by 
 facts.' 
 
 "Well, no doubt, it is a very natural apprehension, 
 that Bimetallists should utilize an argument, the ba- 
 sis of which is so emphatically certified as not merely 
 "sustained by facts,' but also as 'sound in principle,' 
 by one of the most eminent practical financiers in 
 England. 
 
 "I have already mentioned the proposal that has 
 been made in view of the .terribly serious difficulties 
 resulting from the difference of standards between 
 England and India. It has been suggested, as a means 
 of getting over all these difficulties, that the Indian 
 currency should be re-constituted on the basis of a 
 gold standard. 
 
 "But this, from the further demand it would make 
 upon the existing stock Of gold in the world, would 
 necessarily lead to a further increase in the value of 
 gold, and would thereby most seriously aggravate the 
 evils of the present situation throughout the commer- 
 cial world. 
 
 "As Mr. Gbschen forcibly expressed it at the Paris 
 Conference of 1878 — 'If other States were to carry on 
 a propaganda in favor of a gold standard and of the 
 demonetisation of silver, the Indian Government 
 would be obliged to reconsider its position, and might 
 be forced by events to take measures similar to those 
 taken elsewhere. In that case the scramble to get rid 
 of silver might provoke one of the gravest crises ever un- 
 dergone by co7nmerce. ' 
 
 "So far, then, for the tendency of gold, in the pres- 
 ent monetary arrangements of the commercial world, 
 to increase in value. 
 
 "Now; as to the remedy which Bimetallists pro- 
 
6o 
 
 pose. This, as we have seen, is, to put silver into 
 the standard currency concurrently with gold — by open- 
 ing the mints for the unlimited coinage of the two 
 metals at a fixed ratio of value, and making both the 
 gold and silver coinage 'legal tender' to any amount. 
 
 "Their main point is that the introduction of silver 
 in this way into th« standard coinage would check 
 the tendency of money to 'appreciate,' or increase in 
 value. It manifestly would tend to check that ten- 
 dency by broadening the base on which the monetary 
 system stands. 
 
 "Statisticians tells us that the quantity of coined 
 gold in the world amounts to about ^800,000,000 ster- 
 ling, and the quantity of coined silver to about jQyoo,- 
 000,000. The precise figures, in such a case as this, 
 are not of very great consequence. For we may take 
 it, at all events, that the amounts are something about 
 those mentioned; Plainly, the causes that tend to 
 affect the value of either of the two precious metals 
 would have a far less disturbing effect upon a standard 
 of value composed of the two metals, conjointly, to 
 the value of 1,500 millions sterling, than it would have 
 upon a currency of only half the amount. 
 
 "Then, furthermore, it is to be remembered that 
 this enlarged currency would consist, not of one metal, 
 but of two. 
 
 "It is, no doubt, possible that the tendencies of the 
 two rnetals to fluctuate in value may coincide in di- 
 rection and in degree. But it is in the highest degree 
 improbable that this will always, or even frequently, 
 occur. Whilst the value of one metal, under the ope- 
 ration of the law of supply and demand, tends to go 
 up, the tendency of the other is quite as likely to be- 
 downward. Or, if both tend to move in the same di- 
 
6i 
 
 rection, all the probabilities are that their respective 
 tendencies will differ in degree, and the difference is 
 by no means unlikely to be a very notable one. So 
 each will serve, at all events in some degree, to coun- 
 teract the other. 
 
 "Professor Jevons — though he was not a Bimetallist 
 — gives an admirable example of the effect produced 
 by the intrroduction of a second metal into the stand- 
 ard currency, in checking the tendency to fluctuations 
 in value. 
 
 "He gives the example of two reservoirs of water, 
 each subject to independent variations of supply and 
 demand. In the absence of any connecting pipe, the 
 level of the water in each reservoir will be subject 
 to its own fluctuations only. But if we open a con- 
 nection, the water in both will assume a certain mean 
 level, and the effects of an excessive supply or de- 
 mand will be distributed over the whole area of both 
 reservoirs. 
 
 " 'The mass of the metals,' he says, 'gold and sil- 
 ver, circulating in Western Europe in late years, is 
 exactly represented by the water iji these reservoirs, 
 ^'I'and the connecting pipe is the law of the 7th Germi- 
 nal, an XL (the law establishing Bimetallism in 
 France in 1803), which enables one metal to take the 
 place of the other as an unlimited legal tender.' 
 
 "Mr. Samuel Smith gives another illustration. He 
 takes the case of a kite. If the currency consists of 
 gold only, then we have a kite without a tail, blown 
 hither and thither by every wind. If we have a com- 
 bination of gold and silver, linked together in a mon- 
 etary system at a fixed ratio of value, then we have a 
 kite with a heavy tail attached to it and steadying it." 
 
62 
 
 Reporter: 
 
 "But is it really possible at this time of day, by any 
 State regulation, to fix the price of silver or of any- 
 thing else? Will not the price of any precious metal, 
 in spite of artificial restriction, find its level in the 
 market under the law of supply and demand?" 
 Answer: 
 
 "That is the stock fallacy of the Monometallists, I 
 mean the Monometallists of the older, but now rapidly 
 dwindling, school. 
 
 "Of course, supply and demand will regulate all 
 prices — the price of silver or gold, as well as of every 
 thing else. But this precisely is the reason why Bir 
 metallism is an effective means of keeping gold and 
 silver at a fixed ratio of value in the bullion markets 
 of the world. i 
 
 "Legislation cannot directly give value to a thing, 
 but it can set up a demand which is one of the factors 
 of value. 
 
 "The opening of a sufficient number of mints for 
 what practically amounts to the purchase of silver at 
 a certain price relative to gold, establishes a constant 
 demand for silver at that price. So long as Bimetal- 
 lism was upheld in the French and other mints, the 
 ratio was kept steady. 
 
 "It was kept steady, too, not in contravention of 
 the law of supply and demand, but precisely because 
 of the operation of that law. The State arrangement 
 for the unrestricted coinage of both metals in those 
 mints at the fixed ratio of 15^^ of Silver to i of gold, 
 was, in fact, the mainspring of the working of the 
 law of supply and demand in the case. 
 
 The arrangement that was in operation in the various 
 mints constituted a permanent demand for each of the 
 
63 
 
 two precious metals at that fixed ratio between the 
 mint values of the two. Those who had silver any 
 where to dispose of would not part with iS or 20 
 ounces of it for an ounce of gold, when by sending 
 their silver to a public mint they could get as good 
 a price for 15^^ ounces. 
 
 "Then, moreover, Bimetallists call attention to a 
 series of undoubtedly striking facts in connection with 
 all this. 
 
 "During a long period of years preceding 1873, al- 
 most every kind of disturbance that could by any pos- 
 sibility have interfered with the relative value of gold 
 and silver occurred in the monetary world. Still, 
 throughout it all, the relative value of the two stood 
 practically unchanged. 
 
 "'The ratio of 15^^ to i,' says Mr. Samuel Smith 
 existed during a long period, when silver was annually 
 produced to three or four times the value of gold, and 
 during another long period when gold was annually 
 produced to three or four tiroes the value of silver. 
 
 "'It was. equally unaffected by the great increase in 
 the cost of producing silver during the Civil Wars in 
 South America, which closed the richest silver mines, 
 and by the extraordinary decrease in the cost of pro- 
 ducing gold, when the rich mines of Australia and 
 California were first discovered. 
 
 " 'It was equally unaffected by the entire cessation 
 of the great Eastern demand for silver which happened 
 once or twice in the earlier part of the century, or by 
 the extraordinary demand which set in during the 
 time of the Cotton Famine. 
 
 "'Neither was it-affected by the vast displacements 
 of' specie that occurred, in many countries — such as the 
 -United States- of America, Italy,, Austria .&c.^-caused 
 
64 
 
 by war, or national bankruptcy, when inconvertible 
 paper expelled metallic money. 
 
 " 'It may be asserted, in brief, that every possible 
 convulsion occurred in the monetary world during the 
 first three-quarters of this century, and yet the tie be- 
 tween gold and silver was not broken. 
 
 " 'So long as the French Mint was open to coin 
 either of them to an unlimited extent, and as full legal 
 tender, it mattered not whether the yield of gold was 
 two millions a year, or thirty millions ; whether the 
 yield of silver was six, or sixteen millions; whether 
 the miners in Australia were extracting gold at a cost 
 of ;Qx per ounce, or the miners in Nevada were pro- 
 ducing silver at \s. 6rf. per ounce.' 
 
 "Between 1848 and 1870, the stock of gold money 
 in the world, according to trustworthy estimates, in- 
 increased by nearly go per cent, whilst the quantity of 
 silver money in the world increased by only 10 per cent. 
 But still, under the natural operation of the Bime- 
 tallic system of France and other countries, the rela- 
 tive value of gold and s\\\ex stood practically unchanged." 
 Reporter: 
 
 "That, as we now know, is no longer the case?" 
 Answer: 
 
 "Unfortunately for many interests, it is not. The 
 Royal Commission of 1887 gives a table which shows 
 that the annual average price of silver on the London 
 market, from 1833 to 1872, never was lower than 4^. 
 10^^. per ounce, and never was higher than y. 2 
 ■^4</. — showing a variation only of \d. The same 
 table shows how different the case has been since 1873. 
 Between 1873 and 1887 the price ranged from \s. 11 
 Yi^d. down to IS. bd. — showiug a variation of is. 5 
 •lid., as against an extreme variation of only 4</. in 
 the former period." 
 
65 
 Reporter: 
 
 "But what about the Monometallist members of the 
 Commission? Do they admit that the relative values 
 of gold and silver can be fixed by State regulations?" 
 Answer: 
 
 "Certainly. In the earlier stages of the controversy 
 about Bimetallism, the question whether the relative 
 value of gold and silver could be so fixed was looked 
 upon as one of the great test questions between Mono- 
 metallists and Bimetallists. 
 
 Monometallists tried to make out that the relative 
 value of gold and silver was kept steadj' down to 1873 
 — not by the State arrangement then in force in France 
 and the other countries of the Latin Union — but by a 
 whole complicated series of independent causes, all 
 happening to work in the right direction to bring about 
 this happy result. 
 
 "But, as Mr. Samuel Smith has pointedly expressed, 
 it, these attempted explanations of the Monometallists 
 'remind one of nothing so much as the hopeless at- 
 tempts of the ancient astronomers to explain the 
 movements of the heavenly bodies on the theory that 
 the earth was the center of the universe.' 
 
 "That day, however, is past. Leading Monometa.- 
 lists have long since found themselves forced to ac- 
 knowledge that on this vital point the Bimetallists 
 were right. 
 
 "Here, for instance, is an important passage from 
 the Report of the Royal Commission. 
 
 "I take it from that portion of the Report which 
 is signed, unanimously by the 12 members of the 
 Commission, Monometallists and Bimetallists alike. 
 
 "After setting forth a number of figures illustrative 
 of the notable unsteadiness of the price of silver in 
 
66 
 
 recent years — the unsteadiness, that is to say, of the 
 gold price of silver, or, in other words, the relative 
 value of the two metals — the Report continues as fol- 
 lows : — 
 
 " 'The explanation commonly offered of those con- 
 stant variations in the silver market is, that the rise 
 or depression of the price of silver depends upon the 
 briskness or slackness of the demand, for the purpose 
 of remittance to silver-using countries, and that the 
 price is largely affected by the amount of the bills 
 sold from time to time by the Secretary of State for 
 India . . . 
 
 " 'But these causes were, as far as can be seen, op- 
 erating prior to 1873, as well as subsequent to that 
 date, and yet the silver market did not display the 
 sensitiveness to those influences, day by day, and 
 month to month, which it now does. 
 
 " 'These considerations seem to suggest the existence 
 of some steadying influence jn former periods, which 
 has now been removed, and which has left the silver 
 market subject to the free influence of causes, the full 
 effect of which was previously kept in check.* 
 
 "It seems impossible, for instance, to evade the 
 force of the following facts. 
 
 "First, from 1803 to 1873, whilsi the Bimetallist 
 arrangements of France were in force, the market 
 prices of gold and silver, each year, kept so close to 
 the French cunency value of 151^ to i, that they 
 never oscillated so far even as 16 to i on the one 
 side, or 15 to i on the other. 
 
 "But then, in the year 1874, the year after the 
 change in the French system, the market ratio at once 
 
67 
 
 rose to over i6 to i. In 1876, 1877, and 1878, it was 
 over ,17 to I. From 1879 to 1884, it was over 18 to 
 I. In 1885 it was over 19 to i. 
 
 "Then, with certain fluctuations, it still kept on 
 rising. On the 24th of September of the present year, 
 1892, the latest date for which I have seen a return, 
 it was about 24 to i." 
 Reporter: 
 
 "The former steadiness, then, was the result of the 
 arrangement in operation at the French and other 
 Mints?" 
 Answer: 
 
 "Yes ; that is to say, it was the result of the demand 
 set up for each of the two metals at the relative val- 
 ue of 15^ to I. But there is a point of great impor- 
 tance to be mentioned here. It may be useful to men- 
 tion it, to guard against a possible misconception. 
 
 "What was fixed by the action of France and the 
 other countries of the Latin Union was the ratio of 
 the values of gold and silver, compared one with an- 
 other. 
 
 "Fixing the relative value of the two metals, that 
 is, the ratio between the values of the two parts out of 
 which the whole monetary stock of the world is made 
 up, is quite a different thing from fixing the value of 
 money, that is to say, the purchasing power of money 
 as regards commodities. 
 
 "It is quite consistent with the maintenance of a 
 fixed proportion of value between the two metals which 
 go to make up the metallic currency, that the value 
 of the currency itself, taken as a whole, should be lia- 
 ble to fluctuations. I have already mentioned that 
 the maintenance of an absolutely invariable standard 
 of value — whether consisting of one metal, or of two 
 
68 
 
 metals linked together in a fixed ratio of value to 
 one another — is a matter of practical impossibility. 
 The value of money, that is to say, the value of the 
 whole stock of coined metal must, like the value of 
 everything that is matketable, be. regulated by the 
 law of supply and demand. 
 
 "But whilst the purchasing power of the whole stock 
 of the money of the world may so vary, the relative 
 value of the two portions of it, that portion of it 
 which is in gold, and that portion of it which is in 
 silver, may be kept in the same proportion towards 
 each other, so that, although the number, whether of 
 sovereigns or of rupees, required for purchasing a 
 given quantity of other marketable goods, may some- 
 times be greater and sometimes less, the same num- 
 ber of sovereigns shall always practically be worth the 
 same number of rupees. That is the first advantage 
 secured bj' a Bimetallist system. 
 
 "Then there is another point. Although an abso- 
 lutely invariable standard of value is practically unat- 
 tainable by legislation, it is plain that a much higher 
 degree of steadiness of value in the monetary stand- 
 ard may be attained by making that standard consist 
 of the two metals, gold and silver, conjointly, than if 
 it consisted of either of those metals alone. Obviously 
 the combination of the two metals makes up a curren- 
 cy far less liable to be affected by whatever fluctua- 
 tions may occur, than any currency composed of one 
 or the other metal alone. 
 
 "In that way, the Bimetallic system of France and 
 of the other countries of the Latin Union, secured for 
 those countries— and indirectly for the rest of the 
 commercial world — not merely a fixed ratio of value 
 as between gold and silver, but also, in large measure. 
 
69 
 
 a monetary standard as free from fluctuations in value 
 as is practically possible of attainment. 
 
 "Let us look back to Professor Jevons' illustration, 
 the two reservoirs with the connecting pipe between 
 them. When there is a difference between the total 
 inflow and the total outflow — taking both reservoirs 
 into account — no possible freedom of connection be- 
 tween the reservoirs can hinder the common level 
 from being affected by that difference. But the effect 
 of the connection between the two is to keep the fluc- 
 tuations of the common level in both reservoirs as 
 free from fluctuations as is consistent with the contin- 
 uance of an inflow and of an outflow, both constantly 
 varying. " 
 Reporter: 
 
 "In that way, then, Bimetallism checks the tendency 
 to variation in the value of the monetary standard?" 
 Answer: 
 
 "Yes; it checks that tendency; but we must remem- 
 ber that it only checks it. The check which it applies 
 is, indeed, a very notable, a very substantial one 
 But the tendency to variation in value cannot be al- 
 together eliminated. 
 
 "As Mr. Samuel Smith explains this point, 'What the 
 law cannot fix is the purchasing power of the precious 
 metals in relation to other commodities. 
 
 " 'Suppose, for argument sake, that the joint pro- 
 duction of gold and silver, which is now about 33 mil- 
 lions annually, were to become 100 millions, we should 
 find a rapid rise in money prices; in other words, a 
 diminution in the pucrhasing power of money. 
 
 " 'But what the taw can do is to prevent fluctuations 
 in value as between gold and silver, by making ,theni 
 both legal tender at a definite rate. . . 
 
70 
 
 " 'As stability of value is one of the most necessary 
 qualities of money, ... it is better to confine fluc- 
 tuations to the mass of gold and silver combined, than 
 let each metal fluctuate separately. 
 
 " 'Gold alone has varied within this century from an 
 annual production of ,^3,000,000 to ^30,000,000^ or 
 ten-fold. But gold and silver combined have only 
 varied from about _;^io,ooo,ooo to _;^40,ooo,ooo, or 
 fourfold — hence the joint metal forms a more stable 
 mass than gold alone.' 
 
 "Here is where Mr. Smith brings in the comparison 
 I have already mentioned: — 'It is like a kite with a 
 heavy tail to_ it, which prevents the kite from sway- 
 ing to and fro; whereas gold alone is a kite without 
 a tail which obeys every gust more readily. ' 
 
 "Stability of value in the monetary standard of value 
 is, of course, of very great importance. But the im- 
 portance of it is sometimes overlooked. In view of 
 this aspect of the case, some newspaper disquisitions 
 on the currency question are amusing. Here, for in- 
 stance, is a characteristic specimen: — 
 
 " 'If two sovereigns at the present value of gold have 
 the same purchasing power which three sovereigns 
 used to have, the obvious result is that two sover- 
 eigns will serve just as well as three. 
 
 " 'Thus by natural causes there comes an economy of 
 gold to the precise extent to which there exists a need 
 for it. 
 
 "'The balance is self-adjusting.' 
 
 "That, of course, would be perfectly true if money 
 were merely a medium of exchange, to be employed 
 in buying and selling, the transactions moreover be- 
 ing for immediate cash. But money, as we have al- 
 ready seen, has another and most important function. 
 
71 
 
 It forms — to use Mr. Balfour's expressive words — the 
 'record of obligations extending over long periods of 
 time. ' 
 
 "It is in view of this important function of money — 
 a function which the writer of the curious disquisition 
 I have just quoted, wo aid seem never to have heard of, 
 — that stability of value, in so far as it is attainable, 
 is one of the first requirements of a monetary stand- 
 ard." 
 Reporter: 
 
 "Then what do the Monometallists say to all this?" 
 Answer: 
 
 "Their position in reference to the practical aspects 
 of the case is indeed not easy to define. I have al- 
 ready pointed out how they have been driven back 
 from one line of defense to another. So far as I 
 have been able to make out, there are not many of 
 them now who do not admit, to the full, the existence 
 of the evils I have spoken of, and who do not admit, 
 moreover, that those evils are mainly, if not exclu- 
 sively, the result of an increase in the value of gold. 
 But then, as regards the remedy for it all, their posi- 
 tion seems to be that of men who will merely sit by, 
 with folded arms, and do nothing. 
 
 "Mr. Giffen, indeed, at the end of the statistical 
 paper from which I have quoted his explicit and em- 
 phatic statement as to the notable and still increasing 
 rise in the value of gold, suggested a remedy for at 
 all events one set of the evils that result from the 
 present state of affairs — those that arfe involved in the 
 unfitness of our gold standard as a measure of obliga- 
 tion in the case of payments extending over long 
 periods, such as a term of years. The suggestion was 
 that, instead of working on the basis of any metallic 
 
72 
 
 standard — whether consisting of one metal or of two 
 — recourse should be had to the device known as a 
 'tabular' standard of Value. 
 
 "Mr. Giffen, indeed, seems to have given up as 
 hopeless the possibility of constructing any satisfac- 
 •tory or equitable system on the basis of specifying, 
 in money, the amounts of payments to be made. 
 
 "Here is how he stated his view: — 
 
 "'Is there anything to be done by Governments (to 
 provide against the effects of the appreciation of 
 gold), is a question which will naturally arise . . . 
 
 " 'The only suggestion I would make is of a statis- 
 tical kind. 
 
 " 'All these difficulties seem to me to suggest the 
 expediency of further scientific study . . of the theory 
 and practice of index numbers which supply a means 
 of providing for deferred payments by substituting a 
 different currency for money, as is done by the corn 
 averages for tithe and by corn rents generally. 
 Reporter: 
 
 " 'If we cannot invent a money that will be stable 
 over generations, may it not be possible to devise a 
 substitute by which the deferred payments will them- 
 selves change with the changing value measured by 
 some other standard? . . . 
 Answer: 
 
 " 'This last suggestion can hardly be expected to be 
 a very popular one at present, while, as yet, index 
 numbers are hardly known to the public. It is remote 
 enough from any practical issues. But . . knowledge 
 is always useful, and a clear insight into what is go- 
 ing on, and what is fairly to be anticipated, may both 
 prevent panic and enable business people to make 
 sensible arrangements in their provisions for the fut- 
 ure which otherwise th^y would not think of. 
 
 " 'In documents charging estates, for instance, law- 
 
73 
 
 yers might have been able to save their clients much 
 embarrassment, in charging a percentage of net rental 
 only, or a sum to be varied by another measure, as the 
 tithe is varied, instead of a fixed and unchangeable 
 sum in money. . . . 
 
 " 'Business men must consider carefully the effect 
 of engagements to pay money at distant dates. 
 
 "'Many mischiefs might have been avoided if all 
 concerned had realized, lo or 15 years ago, what was 
 likely to happen in money, and good will now be done 
 if possibilities are kept steadily in view.'" 
 
 "The idea cf such a 'tabular standard' of value is 
 not a new one. It is discussed by many writers on 
 the currency question. 
 
 "If it were to be worked out in practice, the first 
 requisite would be the appointment of a permanent 
 Government Commission, invested with a kind of ju- 
 dicial power. The officers of the Commission would 
 collect the current prices of commodities in all the 
 principal markets of the Kingdom, and by a system 
 of calculation would compute from the data so col- 
 lected the variations in the purchasing power of gold. 
 
 "The decisions of the Commission would then be 
 published at stated intervals, say, monthly; and all 
 payments would be adjusted in accordance with them. 
 
 "Thus, suppose that a debt of ;£^ioo was incurred 
 upon the ist of July, 1875, and was to be paid back 
 of the ist of July, 1878; if the Commission had decided 
 in June, 1878, that the value of gold had fallen in the 
 ratio of 106 to 100 in the intervening years, then the 
 creditor would claim an increase of 6 per cent in the 
 nominal amount of the debt." 
 
 "But, plainly, the introduction of such a system 
 would lead to so much complexity in the relations of 
 
74 
 
 debtor and creditor that the proposal may well be re- 
 garded — to use Mr. Giffen's expression — as 'remote 
 enough from any practical issues.' 
 
 "Another suggestion that has been put forward from 
 the Monometallist side is, that the disturbing effects 
 of the increase in the value of gold might be avoided 
 by diminishing the quantity of gold in the sovereign, 
 the quantity of gold being diminished in proportion to 
 the increase in its value. 
 
 "Thus, for instance, new sovereigns might now be 
 issued containing about two-thirds of the weight of 
 gold confined in the sovereign as hitherto issued; 
 next year, in case the increase in the value of gold 
 continued, there might be a new issue of sovereigns 
 with a proportionately smaller amount of gold; and so 
 on. 
 
 "This, no doubt, if it could be worked out in prac- 
 tice, woiald meet some of the diflSculties of the pres- 
 ent situation. It would at once, for example, give 
 equitable relief to the Irish tenants and tenant-pur- 
 chasers who are now weighed down by the obligation 
 of making annual payments which, though nominally 
 fixed in amount, really constitute a constantly and in- 
 definitely increasing burden. 
 
 "But the plan is wholly impracticable. One obvi- 
 ous and decisive objection in the way of its adoption 
 is the inextricable confusion that should of necessity 
 result from the difference of value between the sover- 
 eigns of the various successive issues, all, as we must 
 assume, being in circulation together. 
 
 "The chief importance, indeed, of the suggestion of 
 such an expedient lies in the distinct recognition 
 which it implies of the existence and of the serious- 
 ness of the. evils resulting from the Monometallic sys- 
 
7S 
 
 tem of currency with its standard of ever-increasing 
 
 value. 
 
 Reporter: 
 
 "But, then, the practical question remains, Is noth- 
 ing to be done? 
 A nswer: 
 
 "The existence of the evils resulting from the pres- 
 ent system can no longer be denied. 
 
 "Of the Monometallists it may be said that, whilst 
 fully and frankly admitting the existence of those 
 evils, they have no practical remedy to suggest. They 
 are satisfied to hold on by the dog-in-the-manger pol- 
 icy of hindering even a trial being given to the remedy 
 proposed by the Bimetallists. 
 
 "The Bimetallists, on the other hand, have a reme- 
 dy to propose, and what they propose is nothing new, 
 nothing that has not been tested by long experience. 
 The currency arrangements which they recommend 
 were, as we have seen, in full operation in Europe 
 down to the year 1873. 
 
 "In connection with Mr. Giffen's remark that 'many 
 mischiefs might have been avoided if all concerned 
 had realized, 10 to 15 years ago, what was likely to 
 happen in money,' it cannot be out of place to take 
 note of an instructive difference between Monometal- 
 lists and Bimetallists in reference to this matter of 
 foresight as to the increase in the value of gold, and 
 the evils inevitably resulting from it. 
 
 "Whilst the fullest and most distinct warning of 
 all this was given from the Bimetallist side, it was 
 only with extreme difficulty, and not indeed until the 
 Bimetallist predictions had been unmistakably verified 
 by events, that, with very few exceptions, Monomet- 
 allists could be brought to realize that any mischief 
 was being done. 
 
;6 
 
 "The classic prediction in this matter is that of the 
 French economist; M. Ernest Seyd. So far back as 
 187 1, two years before the calamitous success of the 
 doctrinaire crusade against the maintenance of the 
 Bimetallist system as it was then in operation in 
 France, M. Seyd used the following remarkable 
 words : — 
 
 " 'It is a great mistake to suppose that the adop- 
 tion of the gold (standard of value), by other States 
 besides England, will be beneficial. It will only lead 
 to the destruction of the monetary equilibrium hitherto 
 existing, and cause a fall in the value of silver from 
 which England's trade and the Indian silver val- 
 uations will suffer more than all other interests, griev- 
 ous as the general decline of prosperity all over the 
 world will be.' 
 
 "Then comes a singularly noteworthy passage : — 
 
 " 'The strong doctrinarianism existing in England 
 as regards the gold valuation is so blind, that, when 
 the time of depression sets in, there will be this spec- 
 ial feature : — 
 
 "'The economical authorities of the country will 
 refuse to listen to the cause here foreshadowed : every 
 possible attempt will be made to prove that the de- 
 cline of commerce is due to all sorts of causes and 
 irreconcileable matters; the workman and his strikes 
 will be the first convenient target; then 'speculating' 
 and 'overtrading' will have their turn; . . . many 
 other allegations will be made, totally irrelevant to 
 the real issue, but satisfactory to the moralizing ten- 
 dency of financial writers.' 
 
 "Unfortunately for so many interests, the warning 
 so clearly given by M. Ernest Seyd was disregarded, 
 just as similar warnings as to the disasters that must 
 
77 
 
 follow from an obstinate persistence in the mistaken 
 policy adopted in 1873 are being disregarded now." 
 Reporter: 
 
 "But an International Congress is now being assem- 
 bled for the discussion of the question in all its bear- 
 ings?" 
 Answer: 
 
 "Yes, at Brussels. It is attended by representatives 
 of no fewer than twenty Governments or States. But 
 there are not many in Ireland, I dare say, even of 
 those most directly interested, who have the faintest 
 idea that the question under deliberation, important 
 as it may be in other respects, is one that lies at the 
 very root of the difficulties of our Irish Land Ques- 
 tion. 
 
 "Yet what can be plainer than that this is so? If 
 the Bimetallist view, as I have stated it, is true, then 
 progress on the lines of the present currency system 
 means absolute ruin, sooner or later, to the whole 
 body of the agricultural farmers of Ireland. 
 
 " Moreover, whether that view can be demonstrated 
 to be sound or not, there is the significant fact that 
 those twenty Governments have felt themselves called 
 upon to send representatives to an International Con- 
 gress for the consideration of it. That is quite enough 
 for my present purpose. 
 
 "A danger which, even to the extent thus shown, 
 has to be regarded as a possibly serious one, is surely 
 not a thing to be left out of calculation. Hitherto, 
 unfortunately, it has been almost absolutely left out 
 of calculation in Ireland. ' > 
 
 "Possibly the publication of this Interview may do 
 something toward rousing from their present fatal 
 lethargy, both the tenants themselves, and those who 
 
78 
 
 may have the responsibility of advising them when 
 they are arranging terms of settlement, whether as 
 tenants undertaking the obligation of a judicial rent/ 
 or as purchasers undertaking the obligation of repaying 
 to the Government the purchase-moneys of their 
 farms, principal .and interest, by fixed yearly pay- 
 ments, for 49 years to come. ' 
 
 "At all events, in the last resort, there remains the 
 question from which I set out. * 
 
 "No responsible statesman who is not altogether 
 ignorant of the facts of the case, as those facts are 
 now admitted even by leading Monometallists them- 
 selves, will take upon himself the responsibility of 
 saying that there is no need of providing a remedy for 
 the unfortunate tenants who find themselves all but 
 hopelessly encumbered by obligations of payments 
 extending over prolonged terms of years — obligations 
 now admittedly representing a burden altogether in 
 excess of what was contemplated when their terms 
 were fixed, or sanctioned, by the authority of the 
 State itself. 
 
 "This, then, is the practical question: — 
 
 "Is nothing to be done to avert the disaster now 
 plainly inevitable, if those whom recent legislation 
 has subjected to the worst evils of our present cur- 
 rency system are left without a remedy?" 
 
...COIN... 
 
 Coin, an Illustrated Paper, published at Chicago, is 
 advocating, fearlessly and intelligently the free coinage 
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 Let silver men see that Coin has the largest circulation 
 of any newspaper in the United States, that it may talk 
 to millions of people each issue. Send 5 cents for sam- 
 ple copy. 
 
 Address your letters to Coin, 115 Monroe Street, 
 Chicagp, 111. 
 
 COIN'S HANDBOOK 
 
 Gives all the statistics on the subject of Gold and Silver. 
 It gives the gold standard arguments and the answers 
 to them. It reviews the coinage laws of the United 
 States, beginnipg with and copying the first coinage act 
 of 1792, and other valuable information. 
 
 It is issued in a pocket edition, containing forty-four 
 pages, neatly and durably bound. It is an indispensable 
 and valuable book for public speakers and students of 
 the financial question. Special rates to newsdealers. 
 
 Agents are wanted to sell this book in all parts of 
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 making from $3.00 to $7.00 a day at our wholesale price. 
 Write for terms and send 15 cents for sample copy. 
 Address COIN PUBLISHINQ CO. 
 
 115 MONROE STREET, CHICAGO, ILL. 
 
Bl|VIETflUliIS|WI. 
 
 A.!* ADDRESS BY 
 
 FRANCIS A. WALKER, 
 
 AT ram 
 
 OB" THIS 
 
 Boot ^ Shoe Club, 
 
 Boston, riarch 28th, 
 189A 
 
INTERNATIONAL BIMETALLISM. 
 
 In popalar discussiciD, international bimetalliss 
 often encounters a prejudice at the start, from the 
 fact that many persons take it to be somotbing new 
 and untried, which certain theorists are attempting- 
 to urge npon the public, as a panacea for all th& 
 evils which a£Qict mankind. Bimetallism thus suf- 
 leis from that incredulity which naturally and 
 properly arises whenever a new social scheme prom- 
 ising great benefits is proposed. And, indeed, th& 
 monometallists hare been woi;t to speak as if the 
 presumption was in their fayor and the harden of 
 proof rested on ns. As a matter of fact, boweyer,, 
 monometallism is the new and untried thing, which) 
 is being presented to the world and urged upon it» 
 acceptance. Bimetallism is the old, tried and well- 
 approved monetary system of mankind. We know? 
 what bimetallism is, and what it will do. Therw 
 has been no time, for hundreds of years down to-' 
 1873, when bimetallism was not the legal system of 
 3 
 
tDore than one important commercial nation. Tbe 
 mode of its opeiation and the nature of its e&ecfs 
 are well known, and can be studied, bistoricallr, on 
 a wide scale. No one tnows what general gold- 
 monometallism ia, or what it would do, for such a 
 thing has ncYer existed. Durin:; tbe past twenty 
 years the world has Ijeen makinc; rapid progress in 
 r^hat direction, bat the end is still far distant, and 
 4ience no one can say what that system would be 
 and what eflects it would produce. Gold mono- 
 metallism is as yet only half born. Tbe twenty 
 jears' in which it hias been trying to make its 
 way into the light have been years of unpar- 
 alleled commercial disaster and financial distur- 
 bance. On tbe other band, bimetallism has a 
 long record of beneficent activity in promot- 
 ing the stability and regularity of trade and 
 production. Therefore, it is nottrue that the pre- 
 sumption is in favor of our opponents and that the 
 burden of proof rests on ua. Exactly the opposite 
 of this is the case. Gold monometallism is fairly 
 subject to all tbe incredulity and doubt which at- 
 tach to new schemes of far-reaching extent, which 
 are proposed by theorists and idealists for popular 
 acceptance. It has not a single argument from ex- 
 perience on its side. 
 
 Mr. Walker referred to the charge made by Charles 
 C. Jackson, at the recent banquet of the Reform 
 Club, that tbe bimetallists were seeking to produce 
 monetary results by iegialntion; were trying to 
 affect valnea by acts of government ; were in favor 
 of " tinkering Ibe currency." This is a new case 
 of the wolf charging the lamb, who is further 
 down the stream, with muddying the water. All 
 4 
 
thetiakeiing^oE the currency has been by the acts 
 of the moQometallists themselves. We are only try- 
 ing to restore the ancient order, to bring back » 
 system which long existed, which worked well in 
 practice and which achieved great benefits for 
 mankind. 
 
 In 1867 the monometallista met in conference in 
 Paris, and decreed, so far as lay In tbem, that silver 
 shoald, by act of governmeuh by force of law, be 
 thmst OQt of the pljce it had immemorially occu- 
 pied in the currencies of the world, aod tbat gold 
 shoald be foisted by force of law upon countries 
 where it had never been known as money. Abso- 
 lutely no necessity existed for the change at the' 
 time. The single professed object of the confer- 
 ence, in thus proposing to " tinker the currency," 
 was to secure a metrical and mathematical unity 
 of coinage tbroughout the world, a result which i» 
 further off now than it was then. A suffloient proof 
 of this statement is that in the monetary changes 
 which have siuce taken place in the direction of 
 gold monometallism, more than one nation has de- 
 liberately fixed its monetary unit so that it should 
 not conform to the money units of other nations. 
 And yet, for the sake of a purely ideal object, the 
 conference of 1867 proposed to revolutionize the 
 monetary system of the world. The records of that 
 conference show an astonishing lack of regard 
 for all practical reasons. The conference never 
 seriously entertained the question whether there 
 was gold enongh to do the business of the nations 
 upon the proposed basis; or what would be the 
 effects upon prices, wages and debts, upon the con- 
 dition of the working classes or upon the state of 
 
industry and trade, which would be produced by 
 -the projected revolution. Never was a discussion 
 Tnore purely academic, theoretical and idealistic, 
 more completely void of practical considerations 
 and ot reference to the facts ot life and industry. 
 
 In 1873 the monometallists secured the demoneti- 
 szation of silver by Germany and i he imposition of 
 gold money upon the whole German people. 
 Whether wise or unwise, this was an act of pure 
 force, a matter of legislation and of imperial aathor- 
 ity. The " laws of trade," the habits of the people, 
 the needs of business, bad nothing to do with it 
 Every successive step in the demonetization of 
 silver and toward general gold monometallism 
 "has aftorded another instance of acts of government 
 directed toward pj educing monetary results by law 
 •or by decree; and yet tbe gold monometallists 
 ■charge us with "tinkering the cuirercy," whereas 
 we only seeU to restoie the situation which esisted 
 -prior to 1873. 
 
 Mr. Walker then proceeded to state the argnmentu 
 for internatioral bimetallism. These are three in 
 number. Of these, two— the first to bemeiitioned— 
 are not and can not be disputed. No economist of 
 reputation has ever undertaken to show that these 
 two arguments are not valid. Men may differ as to 
 "the importance to be attached to these arguments 
 for bimetallism : but no one can deny tbe nature of 
 the effects themselves. Some may question whether 
 these advantages would be sufficient to compensate 
 for the trouble and cost of maintaining a bi- 
 metallic system ; but no one can dispute that bene- 
 fits of this character would result if such a system 
 were established and maintained. 
 6 
 
The first argument for bimetallism is derived 
 from the benefit to irade and production -whicU 
 would follow from the establishment of at least an 
 approximate par-of-exchange between silTer-nsing 
 countries and eold-using countiies. The world is 
 divided, roughly speaking, into two great groups- 
 one using silver as money, the other gold. Between 
 the two there is no natural par-of-exchange. In all 
 transactions between them the money of one must 
 he sold for the money of the other, and sold at rates 
 varying according to continually varying condi- 
 tions of supply and demand. Bimetallism seeks 
 to bridge the chasm between the two, with results 
 of priceless benefit to trade, and through trade to 
 prodnotion, the world over. 
 
 Before the bimetallic system was wrecked by the 
 hostile act of Germany in 1873, a manufacturer in a 
 gold-using country who produced goods for export 
 to China. India, or South America, knew for how 
 much silver he must sell them in order to make 
 himself good for his outlay in gold at home. If the 
 goods cost him 2,000 ounces of gold, he bad to l ell 
 them for something very close to 31,000 ounces of 
 silver {1:15^) to make himself whole. In a word, 
 there was an approximate par-of-exchange 
 between the two halves of the commercial 
 world, to the inexpressible benefit of both. 
 Since 1873, however, trade between gold-using 
 countries and silver-using countries has taken on 
 the character of gambling transactions. The gains 
 or the losses which might result to the trader from 
 fluctuaf ioos in the silver price of gold and the gold 
 price of silver have far transcended the limits of 
 ordinary commercial gains and losses. Interna- 
 
 7 
 
tional trade has become little less than bettingupon 
 the price of silver at a future day. At times during 
 the past twenty years that price has fluctuated 
 moie widely in a single month or week than it did 
 during the whole period of seventy years while the 
 bimetallic system was standing. A manufacturer 
 may produce the right kind of goods, that is, goods 
 which are wanted ; he may make them of excellent 
 quality ; may send them to the right market; that 
 is, to a market where they aie in demand ; may sell 
 them there at a good price ; he may sell them to the 
 right persons, that is. to persons of commercial 
 responsibility ; and yet a fall io the price of silver 
 between the time when the goods are made, or even 
 when they are sold, and the time when he brings his 
 silver home, may destroy the whole-prolit of the 
 transaction, may even involve him in loss and 
 possible ruin. 
 
 Is it possible for any one io question toe advan- 
 tage to commerce of the bimetallic system? It 
 would not seem so, and yet there are some econa- 
 mists who are content to say, " oh, well, what one 
 man loses some other man gains." A poor argament, 
 indeed ! Is it not equally true that over the faro 
 table or at roulette, what one man loses some other 
 man gains ? If human history teaches anything, it 
 is that unearned gains can never do the man who 
 receives them a degree of good 'which at all compen- 
 sates for the injury ibat is done to another by un- 
 deseived losses. Of all people, Ibe leading gold 
 monometallists of the United States— David A. 
 Wells, Professor Sumner and Horace White— are the 
 Jast who have the right to disparage this consider- 
 ation, since they are the very men who, between 
 8 
 
1^63 and 1879, most vehemently denounced the 
 paper money of the United States, on the ground 
 that it Tendered impossible a par-of-excbange be- 
 tween ourselves and the countries with which we 
 traded, and required our merchants to sell, not only 
 theii goods, but, in turn, the money which they Rot 
 for their goods. These men, speaking in public or 
 -nriting for tJie press, declared that this was a 
 monstrous evil, an evil so vast that no sacrifice and 
 no efiort could be too great for its removal. 
 
 The establishment of bimetallism would be like 
 throwing a bridge across some deep, broad and 
 dangerous river which separated two important 
 manufacturing cities. Without the bridge no 
 man. would know when he -might ferry his goods 
 across, what would be the degree of danger,, 
 what the cost. For days the stream might be 
 swollen with floods, hidden by fogs, obstructed 
 by ice, or tossed by high wiuds, so as to make 
 passage unsafe or perhaps impossible. Such an 
 obstacle would not only add greatly to the cost 
 of transportation and the time required, but to the 
 hazards and perils of commerce between the two 
 cities. It wouldnot be true that what one lost the other 
 would-gain. Both would lose together, and lose heavily. 
 
 The second of the advantages attributed to bi- 
 metallism is the greater stability of the compouad 
 mass formed of gold and silver, under the bimetal- 
 lic system. The history of the precious metals is a 
 story of Ijighly spasmodic and intermitteat produc- 
 tion. At times the precious metals (speaking of them 
 now as one) have poured iu vast quantities fTom 
 newly opened mines; at other times, production has 
 languished, diminished and almost ceased. From 
 
this have followed frequent and far-ieachmg 
 cbaDges in tbe value of the precious metals and, by 
 consequence, in general prices. 
 
 But, while the production of the precious metals, 
 viewed as one, has thus fluctuated widely from age 
 to age, it is also true that tbe production of gold 
 and the production of silver, taken separately, have 
 varied greatly. At the time the bimetallic system 
 was established in France, namely, 1803, three dol- 
 lars' worth of silver was produced annually for a 
 dollar's worth of gold. Fifty years later the ratio 
 was only 27 cents' worth of silver to a dol- 
 lar's worth of gold. Now, with this tendency 
 inherent in the production of the precious metals, it 
 is evident that, if the two could somehow be joined 
 together in one mass, which should have a uniform 
 or approximately iiniform value-movement, the 
 compound mass would possess a greater stability 
 than thetwo bodies singly could have. Itispossible 
 that the tendency of the one to rise would be exactly 
 counterbalanced by the tendency of the other to 
 fall. It is, however, more likely that in each there 
 would be some rise or some fall— the two moving 
 together, but throngh a shorter distance than either 
 would have done alone. The principle is incontest- 
 able. It has been clearly stated by the Englis'h 
 monometallists — Basehot, Jevons, and Cairnes. 
 
 It should be remembered that the two foregoing 
 arguments for bimetallism are not in dispute. This 
 is important to be noted, because in the clamor 
 which is raised over our tbird point, men are apt to 
 forget that, whether gold is, or is not, appreciating; 
 whether prices are. or are not, falling, in conse- 
 quence of the demonetization of silver, two great 
 
standing reasons for bimetallism still remain, which 
 are, of themselves, sufficient to prove the cause of 
 himetallism to he the cause of civilization. The 
 argument for himetallism was complete long before 
 the fall of prices he^an. From the time of John 
 Locke to that of Wolowsti and Laveleye, econo- 
 mists, Unaiiciers and statesnien had argued for hi- 
 metallism, ■wholly irrespective of any anticipated 
 appreciation of gold. 
 
 The third argument for bimetallism has reference 
 to the scarcity of the yellow metal at the present 
 time. The bimetallists allege that there is not gold 
 enough to do the business of the nations which have 
 been drawn into or toward monometallism during 
 the past twenty years. They point to the unprece- 
 dented struggle for gold wl.ich is going on through- 
 out the civilized world, and which is all the time 
 keeping the nations in a state of financial strain 
 which is most dangerous in itself, and which is con : 
 tinually threatening commerce and trade with dis- 
 aster. Such is the financial situation; the indus- 
 trial situation is even worse. Here the bimetallist 
 points to the fact of gold prices steadily falling ever 
 since 1873. The tables of Sauerbeclj; show that the 
 average price of 45 commodities has fallen from 
 TOO in 1873 to 68 in 1892, since which time there 
 has notoriously been a still further decline. This 
 state of things the bimetallist regards as working 
 the most serious injury to trade and production. 
 Ko condition is so discouraging and disheartening 
 to the merchant as to bring forward goods upon a 
 falling market. Declining prices cut into the nor- 
 mal proiits of business, check enterprise and retard 
 production. As Mr. Balfour well remarked in his 
 
great Mansion House speech last August, a dimin- 
 ishing muuey supply cou?titutes " perhaps the most 
 benumbing and deadening influence which can 
 touch the enterpiise of a nation." Such a cause is 
 precisely tliat which would produce the effects 
 we see to-day, the world over, and which we feel 
 with such painful force here in tbe United States. 
 
 The monumetallists seek to bruals the force of 
 this argument by pleas of various degrees of irrele- 
 vancy or of fallaciousnesa. In tbe hcst place, they 
 point to the vast stocks of gold accumulated in the 
 banks of Eussia, Germany, and France. But these 
 accumulations are a part of our case. Why has 
 Russia $340,000,000 of gold in her Imperial Bank, 
 while her hnance minister claims that tbe govern- 
 ment controls, in all, $450,000,000? I'hat vast 
 stock is held, not for business, but for war. It is 
 not for the purposes of commercial discount, but 
 for the purpose of crossing the Danube. Mean- 
 while, the stock of gold available for the purposes 
 of .peaceful trade and commerceis steadily growing 
 smaller. 
 
 Again, tbe monometallists point to the lower rate 
 of interest prevailing in recent years as a proof that 
 there is no scarcity of gold. It would be amusing, 
 if it were not pitiful, to note tbe inconsistency of 
 these writers, who are the very same men who have 
 been accustomed to ridicule the South and West for 
 demanding more money, as a means to lower rates of 
 interest. The rate of interest, they said, depended 
 upon the abundance or scarcity, not of money, but 
 of capital. What tbe West and South wanted, they 
 argued, was not more money, but more capital. 
 And yet these men now turn about and point to the 
 
low rate of interest as a proof of the abundance of 
 rhoney. 
 
 But there is more tbau this to be said. A low raie 
 of interest does not alwnys indicate an abnndiince 
 of capital. It may mean that production has been 
 checked ; that enterprise has been discouraged ; that 
 manufacturers are afraid to produce and mercbanta 
 ti» buy. This is exactly what we claim to be the 
 situation at the present time; and we allege that 
 the effect is largely the result of steadily falling 
 prices and of the destruction of th at par-of -exchange 
 between silver and gold, which formt^rly gave a biph 
 degree of stability and regularity to the world's 
 trade and production. 
 
 Again, Mr. Atkinson undertakes to prove that 
 «rold has not riser, by adducing certain statistics of 
 bis own compilation going to show that the work- 
 ingman gets more of the necessaries and comforts 
 of life than be did twenty years ago. But who ever 
 denied tbisi and what has it to do with the case f 
 There has been an enormous increase of productive 
 power since 1873. The laboring classes have, of 
 course, secured a share of (his. but it remains to be 
 proved that the laboring classes would not have 
 been better off, still, but for gold monometallism. 
 Nobody has asserted that the condition of labor has 
 not improved, even in spite of the disadvantages 
 which have resulted from the destruction of the 
 bimetallic system. 
 
 Again, Mr. Atkinson seeks to meet the bimetallic 
 demonstration of the rise of gold, by the introduc- 
 tion of a new test. He declares that we ought no 
 longer to take the prices of commodities as a meas- 
 ure of the appreciation or depreciation of gold,, but 
 
 13 
 
should use labor as that measure. Labor, he de- 
 clares, will produce as much gold now as it did in 
 1873. Bat 1 venture to ask why, if humaii labor 
 will — thanks to improvements in the arts and dis- 
 coveries in nature— produce more of the ase/itJ 
 metals than it did in 1873, it should not also pro- 
 duce more of the precious metals? If mankind are 
 to have the benefit of cheaper copper, iron, lead, zinc 
 and aluminum, ^n hat good reasou is there why it 
 should not have the advantage of cheaper gold ? If 
 mankind are to produce couimodities iu increased 
 quantities by reason of increased efficiency, why 
 should they not increase pari passu the production 
 of the money melals ? 
 
 Mr. Walker said that he would not weary his 
 audience by the recital of the various pleas by 
 which the monometallists sought to evade the 
 demonstration of figures that gold has risen largely 
 in yalue as the result of the demonetization of 
 silver. The demonstration of that fact abundantly 
 appears in the tremendous fill of prices since 1873. 
 Mr. Uiiiea, the highest living authority in com- 
 mercial statistics, and himself a gold monometallist, 
 admits that the non-monetary demands for gold at 
 the present time almost eg.ual the entire annual 
 productioa. In this connection, Mr. Gifien quotes 
 with approval the estimates of Oltomar Haupt, 
 that it would require at least $70,000,000 in gold, a 
 year, to keep up the stock and to supply tlie in- 
 creasing wants of commerce. Nothing like tbat 
 amount is forthcoming; and even the slight spurt 
 of gold production in the United States and Africa, 
 during the past two years, has not prevented the 
 supply turn becoming steadily less and less ad- 
 equate to Ihe demand. 
 
Such are the arguments foi international bimet 
 allism. That such a monetary system is economi- 
 cally piacticable, has really passed out of the field 
 of dispute. The ablest European monometaIlist» 
 novy generally admit the economic validity of the 
 bimetallic argument. The sole remaining question 
 ij, then, whether international bimetallism is politi- 
 cally and diplomatically possible. Until recently 
 tbisdidnot appear to be the case. The speaker 
 s»id that, for one, although a strong bimetallist ia 
 opinion, he had entertaioed very little hope of any 
 satisfactory solution of the problem, at least until 
 the evils of increasing monometallism should be 
 much more painfully manifested. But tbe remark- 
 able change of public sentiment in Eagland, during 
 the past five, and especially during the past two 
 years, in the direction of inlei national bimetallism,. 
 Las given rise to a reasonable hope that England 
 may, at no distant day, lend her mighty financial 
 influeni'.e and power to some rational and thoroughly 
 practical scheme for restoring silver to its ancient 
 place in the currencies of the world. 
 
 LBepitated from the Sftoc and Leather ReporUr.\