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Address before the Union League Club of Chicago.


Mr. President and Gentlemen, of the Union League Club of Chicago — On this anniversary of the birth of one of the greatest and purest men that ever lived it seems especially appropriate to consider the subject assigned me and endeavor to determine, at least in our own minds, what is an honest dollar. We have with us a large class of citizens who argue that a piece of paper stamped by the Government is an honest dollar. Clearly this is not true, for it is good for a dollar only so long as the Government has the ability and inclination to pay. There is still another class who would have us believe that 371 grains of silver coined by the Government and stamped as a dollar is an honest one; but the real fact is that it costs less than 50 cents to produce these grains of silver, and therefore one-half of its value depends upon the Government stamp.

An honest dollar is that which it costs 100 cents to produce and which, melted down in the refining pot, will bring a dollar in any of the commercial markets of the world. Anything is a sham and a cheat.

It has been a favorite pastime with kings and governments, especially when in financial distress, to issue from time to time printed bits of paper which they stamped as worth a dollar and compelled their subjects to receive, so far as the law could compel them to, in payment of debts and or sale of property, and thereby fancied they were either creating wealth else cheating their subjects. But there never has been such a case where the government or its people did not get into trouble unless such paper was speedily redeemed.

This country in its early days had a disastrous experience with paper money. In the six years from 1775 to 1781 the Continental Congress issued $500,000,000 of paper money. This issue of paper was bolstered up by every device that the human mind could invent. Imprisonment, forfeiture of property, banishment, awaited the unlucky citizen that did not receive it


in payment of debts or for the sale of goody. Appeals were made to his fears and his patriotism, but, in spite of all this, it kept falling steadily in value and led to an immense amount of wrong and dishonesty. Scoundrels and knaves seized upon the opportunity to pay their debts and liabilities with it, especially those to widows, orphans and estates, that could not escape.

Money that was Worthless.

The soldiers of the Revolution were paid off in it when a month's pay would not purchase a breakfast for one of those poor fellows. Finally it sank so low that by common consent it was entirely repudiated. In Philadelphia, then the seat of government, its end was celebrated by a public procession in the streets, led by a dog covered with a coat of tar, and instead of the usual coat of feathers they used Continental money. Public credit and public honor were debauched and the moral standard of the Nation probably never was so low as at that time. Among the letters written by the distinguished man whose birth we meet to celebrate was one in 1781 to his overseer, complaining of how he had been wronged and cheated by people paying him in Continental money that was worthless and which nobody would receive if he could avoid it.

With the wrongs of this paper money fresh in their minds the men who made the Constitution of 1787 did not intend to allow any such condition of affairs to happen in the future. The debates of that period clearly show this. The financial condition of the country and of the currency was deplorable until Alexander Hamilton was made Treasurer, and, as Webster says in his oration, "he smote the rock of credit and its waters gushed forth," and immediately the cause of good Government and morals improved.

In the troubled days of 1814, 1837 and 1857 that came to this country, when the banks suspended specie payments and the government was in distress, treasury notes were issued, but were not legal tender and bore interest and were always taken up as soon as possible. The experiment of issuing fiat money after 1781 was not made until 1862, at the commencement of the Civil War, when the Government was so hard pressed for funds. Its credit was so low and Congress was so doubtful about the temper of the people as to paying taxes, that they decided to experiment with legal tender notes. This was not done without great hesitation and much opposition, One prominent Northern senator even went so far as to intimate that flat money was a worse evil than slavery. Its constitutionality was doubted, and it was the expectation of every one that the notes would soon be retired. With continued new issues they fell to 40 cents on the dollar, or, as it was popularly said, gold rose to 250 per cent. Prices of everything were practically based on gold, and two for one were paid in greenbacks. Capitalists and speculators bought our Government bonds at half rates, and


we were launched on a wild career of speculation and financial debauch, which lasted until the panic came in 1873. The maximum amount of legal tenders was reached in January, 1864, when the amount outstanding was $449,338,902. These were reduced until in December, 1867, the amount outstanding was $356,000,000. Then the greenback element or flat money partly began to show their strength, and further reduction was prohibited in 1874. An attempt was also made to increase the issue, but General Grant punctured it with his veto. In June, 1875, the Secretary was authorized under certain conditions to reduce the amount to $300,000,000. In May, 1878, this authority was repealed and the amount outstanding fixed at $346,000,000, the present amount.

Time to Let the Greenbacks Go.

Such is the history of this paper money, which every one supposed and expected would be retired immediately after the close of the war, or as soon as the finances of the country would justify, and which is outstanding now — thirty years after. We have redeemed our bonds before they were due; we have paid our debts faster than any nation on earth; and yet we have allowed this dangerous element to remain, and so much does a long familiarity with evil tend to make us forget its danger that we find to-day a large party who are opposed to retiring and paying them off. To maintain this $346,000,000 of greenbacks on the basis of gold the Government is required to carry in its vaults $100,000,000 of gold. If these greenbacks were redeemed this gold could be used to pay off an equal amount, and it would leave but $246,000,000 to take care of. To pay these would require an equal amount of 3 per cent. bonds, the interest upon which would be something over $7,000,000 a year. At the bare mention of it, some of our editors and statesmen bold up their hands in holy horror at such a waste of money. They seem to forget that they were issued as a war measure and that they are a constant menace to our prosperity. They talk largely about the loss of the interest upon the bonds issued to pay them, as though it was an absolute loss to this country instead of the payment of an honest debt. To pay the interest upon the bonds necessary to pay off these greenbacks would cost, if assessed per capita, 10 cents to every inhabitant of this country of ours. One panic brings more sorrow and desolation into every home in this land than ten times an assessment like this, and so long as these greenbacks are out so long are we in danger of panics. It is exactly the same as if a corporation, for the sake of saving a little interest, should issue their demand paper instead of making long loans, and when trouble comes they are unable to meet the demand loans and their entire capital is sacrificed.

There is something about fiat money that taints the whole life of a nation and its body politic. It is morally wrong. Like the lapse from truth or virtue of man or woman, it leads to other things and pollutes all


the streams of life. There is no truth so well settled as that legal tender money is wrong and demoralizes a nation and is a constant menace to business, and it is incomprehensible that there should be found men of prominence who will advocate its retention in times of peace.

Substantially the same people who advocate fiat money are in favor of free coinage of silver. The great objection to the free coinage of silver at 16 to 1 is that it would prolong and increase our present business troubles. It is an absolute law, which every schoolboy in the land ought to know, that the poorer money drives out the better, and a silver dollar of 871 grains is worth to day in the markets of the world but 50 cents, and if our government stamps it and makes it the currency of the land, our $600,000,000 of gold that is now in circulation will disappear. It may be that it will wait in the vaults of the banks the same as now, but if so it will stay there as merchandise to be exported, and it will not be banking capital, and this will compel a tremendous reduction of credits, which will produce widespread disaster.

Gold Must be the Standard.

We have been on a gold basis since 1834, either by force of circumstances or by law, and why should we change? The advance of civilization and the laws of commerce have settled that gold is the better coin for conducting the business of the world, and if we wanted to change it we could not alone. We can make our own citizens take the silver dollar in payment of debts and in their internal transactions, but all of our commerce with the outer world will have to be done with gold, because the great commercial nations have so decided, and the talk that we hear that this country can change the standard of value, alone, is puerile, and shows how little its authors know about the laws of trade. They may degrade our standard; they may put us upon the basis of Mexico or the South American republics, but they cannot turn back the unwritten law of civilization.

There are many honest citizens who probably have not thoroughly considered the question who believe in the free coinage of silver, but the great mass of its advocates belong to one of three classes:

First, the people interested in silver mines and in the industry and prosperity of those sections where that mining is carried on. While their motives may be selfish they have at least the merit of being honest and open, and while we may all regret that Colorado and Utah and Nevada cannot prosper as they would if they were producing silver at 50 cents on the dollar and selling it at 100 cents, it does not seem to be fair that the balance of the country should be assessed to continue their prosperity.

Second, those in favor of free coinage of silver who are theorists, men who spend their years reading books, but who have no practical knowledge of business, and yet they desire to settle this question upon their


theories. There is about as much reason in their settling this business question as there was in the Society of Old Maids down in New England discussing the question "Are Boys Worth Raising?" They also overwhelm you with figures and statistics. They predicted the ruin of the world forty years ago because there was too much gold; and four or five years since they were full of their statistics that we would be ruined because there was not enough gold. You can pretty nearly prove anything by statistics if you do not apply any practical business experiences or the history of current events to them.

They are so wedded to their pet theories that they seem unable to comprehend the great change that has been going on in the last twenty years in the relative production of the two metals. In 1874 the production of silver in the world was about 64,000,000 ounces, and that of gold 5,400,000 ounces, the production of gold in ounces being about one-twelfth of that of silver. In 1894 the production of silver had increased to 149,000,000 ounces and gold to 8,800,000; while silver had increased 183 per cent., gold gained only 61 per cent.

The result, of course, has been that silver has fallen largely in its relative value. In the last year the production of silver has decreased, while that of gold has largely increased. If this should continue a few years, as is likely, the value of the metals will again so nearly approximate that the present trouble will disappear, but practically there never has been and never can be such a thing as two standards of value. There is no question but that the unit of value of commerce will be gold. At the same time, silver has been largely used as currency and will be in the future, but it must be upon its gold value. The advocates of silver also tell us that we have not currency enough for business, forgetting that to-day, in all the markets of the world, there is a glut of money, rates of interest never having been so low before, and that credits furnish 95 per cent. of the currency of the country, and that this proportion is increasing each year. The changes that have occurred in the last quarter of a century have been vastly more important than those of any other like period. Business has increased to gigantic proportions, but step by step with this increase has been a development of the mechanism of exchange and credit. Never in the world's history was so little actual money needed for the transaction of business as to-day.

Do not be deceived as to the real issue. The single standard — the gold standard — was not created by legislation, not by German policy, not by the cessation of coinage by the Latin Union, but by the silent, mighty, irresistable laws of trade and commerce. Your time-serving and cowardly politicians will talk to you about bimetallism and the double standard because they are afraid to meet the question openly and fairly; but I tell you that as there is but one yardstick, one bushel, so there can be but one dollar, one unit of value. It is monometallism — either gold or silver. Let us retire to


private life some of the representatives in Washington who have played with the nation's honor by advocating silver, and advance the credit of our country to that of the most favored nation. There is nothing too good for America.

People Who Want a Change.

The third class is the political and financial adventurers of the country who have not been on the successful side of life, either in business or politics, and are willing to adopt any new "ism" that may possibly bring them relief. The land boomer, the demagogue who toils not (except with his mouth), the gambler of every kind who has been unsuccessful, sees in the proposed change and in the debasing of the currency some hope of getting back his lost chance, and he cares not how much it may cost his fellow citizens.

But the great mass of people in this country certainly against this change if they understand it, for it is against their interests. Today our exchanges are on a gold basis; the wheat that is exported is paid for in gold; it is bought from the farmer in gold. The advocates of free silver tell us that if we establish free coinage prices will rise. That is probably true in reference to articles that are produced and sold exclusively in our own country, but the wheat will still have to be sold to the exporter at the gold price, and he will receive his pay in gold. Whether he will convert that gold into silver and take the profit himself or allow, the farmer some portion of it is a question. Even if the farmer should get some portion of the profit on silver, it will probably all be exhausted in the additional sum which he will have to pay for his supplies. His hope may be that he can sell his wheat and other products for the money of commerce and pay his employees in the cheap money which is to be forced upon us, and retain the difference. This is what is being done in India and in Mexico and in some of the South American countries, and, owing to the ignorance of the people there, and the slow way in which information and education increase, they have been able go far to make something in this way; but the American people are more intelligent and will not long submit to being cheated in this manner. The man or woman who earns a fixed salary, whether by the year, month or day, is the last who will get any benefit from a rise in prices like this. There are 70,000,000 people in this country. Ninety-five percent of these probably depend for their support and existence upon a fixed income. They are not going to submit to the payment of that fixed income in a depreciated currency in order that the other 5 per cent. may make money. There are 5,000,000 employed in the manufacturing concerns in this country; there are 1,000,000 employees of railroads; these 6,000,000 hard-working people enjoy a fixed salary; it may be $1,000 a month, it may be $100, or it may be $1 a day; whatever it is, it is paid to-day in the money of the world.


What a Silver Basis Would Do.

The dollar which the laborer gets in the manufacturing towns of Illinois or on the farms of Indiana is good in all the commercial markets of the world, and with it he can buy his supplies and the necessaries of life for their value in gold; but if we were launched upon free silver he would have to buy his supplies and the necessaries of life upon the silver basis and trust to getting his pay advanced to correspond. It is this very fact to-day, that labor is paid on a silver basis, that is oppressing and degrading the labor in India, in Mexico, and in South America, and grinding it down to the lowest possible point. Are the workingmen and men with fixed salaries in this country going to submit to a like scheme of robbery?

The capitalist can take care of himself, for with his wealth he is able to so change his investments and make his contracts as not to suffer. But, for the sake of the political adventurer, for the financial boomer who has struck bad luck, shall we debase our currency, degrade ourselves to the level of a South American republic, and rob 95 per cent. of our people who depend for their support upon a fixed compensation?

There can be no question, if ever it is understood by the people, but that they will with practical unanimity be in favor of an honest dollar. The greenbacks must be retired; silver used for our internal commerce, but a silver that the government redeems in and makes as good as gold. The great mass of the people of this country must have an honest dollar, and that dollar must be, as I stated in the beginning, one that is good in any of the commercial markets of the world, and one which melted in the refining pot will bring 100 cents wherever it is sold.

There are some great epochs in the history of our country in which great advantages were secured for the masses. Prominent among them was the restoration of our credit and currency a century since by George Washington, aided by Alexander Hamilton, his great Secretary of the Treasury. Another was the defeat of the greenback inflation in 1874 by General Grant, and the resumption of specie payments later, when, perhaps, he served his country better than upon the battle-fields of Virginia. Side by side with these achievements will be written the heroic efforts of Grover Cleveland to save our national honor from the assaults of the financial cranks of the present Congress. He may have made mistakes; we may not approve of the means used to accomplish the end; but underlying all is the honest purpose and the courageous resolve which will be recorded in history and read with pride by future Americans long after the hand of oblivion shall have kindly obliterated the weaknesses and follies of the present Congress.