We must remember that for many years after the establishment of the Mint we had in this country little or no coin in circulation except silver, and were just as much on a silver basis then as Mexico is now. Were our forefathers, then, inferior to us, or on a par with the Mexicans and Chinamen of the present day? Even down to 1840 the silver in circulation greatly exceeded the gold in amount.
By the way, where do you goldites get the figures to justify you in creating the impression on the public mind that Mexico and the Central and South American States are overloaded with silver, having a big surplus which we are in danger of having “dumped” on us? Didn’t you know that they are really suffering from a scarcity of silver? that altogether they have not a sixth of what we have? One who judged from goldite talk only, would conclude that silver is a burden in those countries, that they have to carry it about in hods. Now what are the facts?
In all the Spanish American States there are 60,000,000 people, and they have a little less than $100,000,000 in silver. Not $2 per capita! This is a startling statement, I know, but it is official, and you will find it in the last report of the Director of the Mint (1895). The South American States have but 83 cents per capita in silver, and Mexico has but $4.50. With a population nearly twice that of Great Britain, they have much less silver, and less than half of that of Germany, though having a much larger population. In fact, to give the Spanish American nations as large a silver circulation per capita as the average of England, France and Germany, they must needs have nearly $300,000,000 more, or nearly three times as much as they now have. It looks very much as if the “dump” would have to be the other way.
From these figures it would seem that the trouble, if monometallists are right in saying there is trouble there, is due not to their having too much silver, but that they do not have enough. Not having enough, they have followed the usual course of nations lacking a sufficient coin basis, and have issued a great volume of irredeemable paper money. By reference to the authority above cited, you will find that they have in circulation $560,000,000 in paper money. One fourth of all the uncovered paper in the world is in those countries, though their total population is less than that of the United States. Who will say that it will be a calamity to them to coin $200,000,000 more in silver and retire that much of their uncovered paper?,
Gold ought to be the standard metal, because, apart from its use as money, it has a fixed intrinsic value.
There is no such thing as intrinsic value. Qualities are intrinsic; value is a relation between exchangeable commodities, and, in the eternal nature of things, never can be invariable. Value is of the mind; it is the estimate placed upon a salable article by those able and willing to buy it. I have seen water sell on the Sahara at two francs a bucketful. Was that its intrinsic value? If so, what is its intrinsic value on Lake Superior?
Well, if what you say be true, there is no intrinsic value in any of the precious metals, and we cannot have an invariable standard of value at all.
No more than an invariable standard of friendship or love. Value is, in fact, a purely ideal relation. All this talk about an invariable dollar which shall be like the bushel measure or the yard stick is the merest claptrap. The fact that gold men stoop to such language goes far to prove that their contention is wrong. The argument violates the very first principle of mental philosophy, in that it applies the fixed relations of space, weight, and time to the operations of the mind. Would you say a bushel of discontent or eighteen inches of friendship? Men who compare the dollar to the pound weight or yard stick are talking just that unscientifically. Invariable value being an impossibility, and an invariable standard of value a correlative impossibility, all we can do is to select those commodities which vary the least and use them as a measure for other things; but you will not find in any economic writer that any metal is a fixed standard. And this brings me to consider that singular piece of folly which furnishes the basis of so much monometallist literature, namely, that gold is less variable in value than silver, and that one metal as a basis varies less than two. Some of our statesmen have got themselves into such a condition of mind on this point as to really believe that, while all other products of human labor are changing in value, gold alone is gifted with the great attribute of God—immutability. It is sheer blasphemy. It is conclusively proved, and by many different lines of reasoning, that silver is many times more stable in value than gold.
I never heard such a proposition in my life! How on earth can it be proved that silver, as things now stand, has not changed in value more than gold?
By the simplest of all processes. If we were in a mining country, I could easily prove it to you by the observed facts of geology, mineralogy, and metallurgy; but that is perhaps too remote and scientific, so we will take the range of prices since silver was demonetized. Of course you have seen the various tables, such as Soetbeer’s and Mulhall’s. Take their figures, or, better still, take those of the United States Statistical Abstract, and you will find the following facts demonstrated: