Why? Because business men are men who do business, or at any rate who want to do business; and all legitimate business consists in the performance of some appropriate function in connection with the production or the exchange of commodities. It is apparent to even the dullest apprehension that whatever prevents or discourages production is destructive of business, and that a money system which provides a measuring unit that constantly demands, as an equivalent, an increasing quantity of everything produced, is the greatest burden on production that could possibly be devised. But it is precisely this kind of a unit that the gold standard furnishes. No one economic fact is so conclusively established and so generally conceded as that of the progressive fall of average prices throughout the gold-standard world during the last twenty-four years. This fall amounts to almost fifty per cent, and indeed, in respect to the great staple products of the country, exceeds fifty per cent; so that, to state the same fact in its converse, the purchasing power of gold has increased since 1873 one hundred per cent.
The significance of this awful fact is deftly obscured behind the deceptive and specious plea for “a dollar of the greatest purchasing power.” This is one of those artful expressions that are used by the advocates of the gold standard as a kind of thought-deterrent. It seems so obvious, at the first suggestion, that the best dollar is the dollar that will buy the most, that it is hard for a man to get even a hearing who asserts that, on the contrary, such a dollar is the very worst dollar conceivable. But a moment’s reflection will satisfy any sane mind that such is the case. The demonstration is so simple that one feels like apologizing for making it. Yet it is in respect to principles just as plain as this one that people are constantly allowing themselves to be taken in by the supporters of the single standard.
The demonstration is this: whatever is bought by a dollar, itself buys the dollar. For example, when a dollar exchanges for a bushel of wheat, the dollar buys the wheat, and the wheat buys the dollar. To say, therefore, that a dollar that buys two bushels of wheat, being a dollar of greater purchasing power, is better than the dollar that buys one bushel, is to say that the dollar which it requires two bushels of wheat to buy is a better dollar than that which can be bought with one bushel. Consequently, to increase the excellence of your dollar all you need to do is to increase the scarcity of the stuff out of which dollars are made, so that each one shall constantly stand for more and more wheat, or, using wheat merely as representative of commodities in general, so that it shall constantly require more and more of all other things on earth to get a dollar. It is wholly credible that the man with dollars should profess this philosophy, but it is absolutely inexplicable how it should receive the support of men interested in getting dollars with things, who comprise about seven-eighths of society.
Now as it continually takes more products to get a given quantity of gold, is it not clear that the producer who becomes liable for taxes and gets into debt must constantly bear an increasing burden of taxation, and that his debt, payable in more commodities than it represented when he incurred it, needs only to run long enough to grow beyond the hope of his ability to pay it? Such a policy cannot but be fraught with certain ruin to producers. It is causing in the United States a condition frightful to contemplate. The mass of debts is piling up at a ratio that absolutely threatens, if a halt in the automatic process is not soon called, a universal insolvency. Indeed a general liquidation is already impossible. He is no alarmist who counsels a timely and rational remedy as not only demanded by justice, but as anticipatory of violent readjustment. Under such disquieting conditions is it not as criminal as it is unscientific for men to go about prating of the system that has occasioned these things as “honest money,” and “sound money,” and denouncing its opponents as repudiators and anarchists?
In the presence of epochal and fundamental disturbance, when men, patient beyond example and willing to argue the correctness of their claims, are crying out against the injustice of a money system that day and night and year upon year, with unerring and pitiless precision, takes from the producing many and hands over to the idle few that which it ruins those to lose and but pampers these to gain, our ex-President offends decency and insults millions of his fellow-citizens with this reference to their contention: “Honest accumulation is called a crime.” Where does he find anybody calling honest accumulation a crime? Men indeed stigmatize the maintenance of this odious money system as a crime, but only because of the things they claim it to be guilty of. Why does he not join issue on these? He knows that nowhere in all this world is there, or has there ever been, a more honest body of citizenship than the millions of Americans who to-day are toiling on the farms and in the workshops of the country and who demand from the laws they obey nothing but equity and justice. It was easier, and more pleasant to those who heard him, to wrong these men with a sneer than to answer them with an argument. He might possibly have done well to relinquish this task to one who sat near him, his ex-Secretary of the Treasury, who had himself, in 1878, discovered something that he thought a crime and had thus denounced it: “According to my views of the subject the conspiracy which seems to have been formed here and in Europe to destroy, by legislation and otherwise, from three-sevenths to one-half the metallic money of the world, is the most gigantic crime of this or any other age.”
The speech of Mr. Carlisle was notable for stating his position more extremely than he had previously done since his apostasy. He boldly takes the stand logically demanded by consistency in the man who opposes silver coinage and denies the arguments based on the appreciation of gold. He comes out squarely for the gold standard and places bimetallism of any and all sorts under a common ban. But alas! what a sorry appearance he makes. Nowhere in our political history do I find quite so pathetic a figure as that presented by this once strong and virile champion of the people’s rights in his contrasted role of defender of their oppressors. Where now is that compact and cogent argument, that sincere and moving eloquence, which made his forensic style so singularly effective; which marked him the parliamentary darling of his party, a predestined president of the republic? Shrunken to the dreary platitudes of the gold-standard catechism, babbling of “sound currency” and “intrinsic value.”
This talk of intrinsic value was not confined to Mr. Carlisle. Mr. Patterson, of Tennessee, and Senator Caffery, of Louisiana, were likewise guilty of it. It is, indeed, the characteristic folly of their school. Having destroyed the money demand for silver while adding almost incalculably to that for gold, they have caused an increasing disparity in the values of the two metals; and now, when it is sought to restore the parity by restoring the equivalence of use and demand on which alone it depends, they pretend to have discovered some inherent perfection in gold and an original sin in silver which forbid all attempts to reconcile them. In the face of monetary principles whose nature has been understood for more than two thousand years, and of historic and economic facts which every college freshman knows, Mr. Carlisle has the appalling audacity to use the following language: “Natural causes have separated the two metals, and while it is possible that natural causes may hereafter change their present relations to each other, it is certain that these relations cannot be changed by artificial means.”
It is difficult to speak with becoming moderation of such stuff as this; and it is really pathetic to see the dominant opinion of whole sections of the country taking its cue from men who assume superior airs and rebuke the presumption of thinking on the part of some millions of Americans, while they peddle such insufferable nonsense as this just quoted from Mr. Carlisle. “Natural causes” indeed, when we can turn to the statute books of half the world and put our fingers on the “artificial means” whereby the hoarders of gold have legislated demand into one metal and legislated it out of the other. Let once a wrong be achieved by artificial means, and instantly those who profit by it represent it as the inevitable decree of evolutional forces. “Natural causes,” we are asked to believe, have made gold dear and silver cheap during a period when the cost of producing gold has been cheapened more than any other mechanical process; when both metals have continued on substantially their old relative planes of use in every respect save as money; when their relative production has been from three to twenty times less disproportionate than at any other similar period in the past four hundred years; and when in actual weight the stocks of coin and bullion available for coinage have risen from a proportion of thirty-two of silver to one of gold up to that of sixteen of silver to one of gold coincidently with a fall of the so-called market ratio from fifteen and one-half to one, when the mints were open to both, down to thirty-three to one when only the one can be freely coined. It is simply an incredible and impossible proposition.
Intrinsic value is as unthinkable as intrinsic distance. Both distance and value are relations. Neither can exist or be stated except by comparison. The value of a thing is what it is worth; and it is worth what it will bring. Value in exchange is the only value that political economy knows anything about; and what a given thing will exchange for depends on the ratio of the supply of it to the demand for it. A piece of money is worth what it will buy. Other things remaining the same, it will buy more when the stuff out of which it is made is plentiful, and less when that is scarce. The proposition of the bimetallists rests on only time-honored doctrines of political economy as justified by the experience of mankind. We desire to restore the parity of gold and silver by perfectly “natural causes” set in operation by “artificial means.” We propose to invoke the law to equalize their opportunity and to make them interchangeably and indifferently responsive to the same money demand.
Space has not permitted reference to all the errors committed at this wonderful banquet, nor a complete discussion of even those cited. I have endeavored only to point out the most glaring ones in the hope that some persons inclined to accept, somewhat carelessly, the assumedly authoritative statements of these eminent men, may be led to study this great subject whose proper understanding and wise management are of such vast importance not only in American politics but in the progress of the race. For the cause of bimetallism must commend itself to the intellect and the conscience of the country or it cannot win. Those who have spent some time in an earnest and thoughtful investigation of the matter and are convinced that the success of silver coinage is the first step in a series of rational, safe, and necessary reforms, are ready to be judged as much by the reasonableness of their doctrine as by the sincerity of their motives. They intend from now on to force the fight. The enemy will be sought out and assailed wherever found. No pretentious claims of infallibility will be accorded immunity from criticism. No authority will be permitted to shelter folly. It is time to expose the preposterous assurance of the gold-standard pundits. Nonsense will be called nonsense whoever utters it, and, what is more, it will be proved to be nonsense.