The public debt should have been paid, as at first provided, in the lawful currency of the country, gold, silver and treasury notes. The law of 1869 added $500,000,000 to the 5-20 bonds, by making them payable in coin; then to refund the bonds, just to please English Shylocks, is villainy unnamed and unnameable[unnameable].
6. The Demonetization of Silver. (Feb. 12, 1873.) The act of 1869 had made all public obligations payable in coin, gold or silver; while the act of 1873, clandestinely passed, by omitting the silver dollar from the list of coins enumerated, practically demonetized silver, making the public debt, interest and all, as well as the paper currency, payable in gold coin—a further contraction of the volume of currency.
The silver dollar was created by the Congress of the United States on April 2, 1792, and made the unit of value. It contains 412½ grains of standard silver, nine parts pure silver, one part alloy. At that time the mints of all the principal nations of the world were open to the free coinage of both gold and silver. That is, all of such metal presented to the mints could be converted into money without any charge except the actual cost of coining. The ratio then was about 15½ to 1; that is, one ounce of gold was equal to 15½ ounces of silver. January 18, 1837, the ratio between gold and silver coins of the United States was changed to 15.988 to 1, commonly referred to as 16 to 1.
The act demonetizing silver was understood by few, and, in fact, many of those who voted for it, and President Grant, who signed the bill, were unaware of its actual meaning and effect. The money speculators of England, backed by cupidity and ignorance on this side, were its real instigators. There was every reason in the world why England should desire the demonetization of silver here. She is a creditor nation, and her capitalists hold vast amounts in government and other securities abroad. From this country alone the capitalists of Great Britain derive each year more than five hundred millions of dollars for interest on their investments, all of which is paid in gold or its equivalent. The United States produces an enormous quantity of silver, but we very humbly submit[submit] to the gold standard as set up by Great Britain. We deny ourselves the right to use a metal of which we have an abundance and adopt one more scarce and, consequently, more expensive. By this policy we are forced to purchase gold abroad, thus adding constantly to the burden of a perpetual, interest-bearing national debt.
By accomplishing the demonetization of silver in this country, England gained a double victory, for the governments of the Latin Union, France, Belgium, Italy, Switzerland and Greece, were soon afterward forced to suspend silver coinage. The gain to England and the loss to the other countries involved, especially to the United States, by this general demonetization of silver, can hardly be estimated. The loss, of course, was the heaviest in this country, where the production of silver is very large, where so many are engaged in agricultural pursuits, and where a large and freely circulating volume of money is so essential to commercial activity.
Before silver was demonetized, we were under the burden of an enormous national debt, but every dollar of this was payable in silver. The stimulated demand for gold, and, consequently, its increase in value, was not the only gain to England. She now buys our cheap silver bullion, exchanges it at its coinage value for products in the silver-using countries of Asia, Africa and South America, and nets a profit of over one hundred per cent. by the transaction. We then buy from her at gold prices and pay with gold or products at prices which, by forcing us into competition with the world, England fixes herself.
7. The Resumption of Specie Payment. (January 14, 1875.) This law provided for the retirement of the fractional currency ($45,000,000) and the legal-tender treasury notes, their places to be supplied by national bank notes, which are not a legal tender between man and man. The name “specie payment” is simply a blind; it does not mean anything; to get rid of the much despised greenback was the real object of the act. The moneyed aristocracy had long ago confessed their inability to “control” the “greenback as it is called.” Had the provisions of this law been carried out, it would have added to our annual interest charge about twenty millions of dollars.
8. The Sherman Purchasing Clause. (July 14, 1890.) This act was a miserable makeshift or substitute for a free coinage bill. It provided for the purchase of not less than 2,000,000 nor more than 4,500,000 ounces of silver bullion per month, 2,000,000 ounces of which was to be coined each month into silver dollars until July 1, 1891. Instead of redeeming the treasury notes issued in the purchase of silver with their equivalent in silver, upon the demand of the holder, the Secretary of the Treasury was required to redeem these notes in gold or silver coin at his discretion. The legal-tender power of the silver dollar was modified so as to read: “Except otherwise expressly stipulated in the contract.” In 1893 President Cleveland called Congress together in extraordinary session to consider the financial condition of the country. November 1, 1893, the Sherman law was repealed, leaving us on a single gold basis.
