The American People’s Money

by Hon. Ignatius Donnelly

Chapter II

“ Mr. Sanders, ” said the banker, “ your reasoning has staggered me.  I am surprised that I never saw anything of the kind in our Chicago papers.  They ransack the heavens and the earth, the past, the present and the future, to get material to fill up with.  Strange that they have never discussed this important question.”

“ Not at all, ” replied the other.  “ Talleyrand said the object of language was to conceal one’s thoughts ;  and there are certain subjects which the daily press is pledged to suppress.  It is a vast conspiracy against the human species ;  and types, ink and paper do the work better than any other agency ever invented by the wit of man.  The conditions we live in are phenomenal, unprecedented.”

“ But seriously, Mr. Sanders, do you not think that if the constitution prescribes certain limitations on the power of Congress, as that it shall not pass an ex post facto law, and Congress does pass such a law, that there should be some power able to come in and say you have violated the express terms of the constitution, and therefore your law is null and void ? ”

“ That would appear reasonable,” said the farmer, but here is the difficulty :  If you give the court the power to over-ride Congress in a case of flagrant violation of the express terms of the constitution, may it not assert the same power as to cases less flagrant, and again, as to cases less flagrant still ?  And having covered the ground as to infringements of the letter of the constitution, will it not advance to the question of violation of the spirit of the constitution ;  and from this will it not go forward, (as the Supreme Court did the other day in the income tax decision), to consider what was the understanding or expectation of some person or persons, named or unnamed, at the time of the adoption of the constitution or thereabouts.  And thus the whole instrument will become as clay in the hands of a potter, to fashion it into a pipkin, or, perchance, a crown, if you please.

Uncle Sam.—“ Get out of this, you infernal scamps !  You have turned my republic into a moneyed oligarchy.  Out of my sight !  You are enemies of mankind ! ”

“ Why, in that income tax decision the court actually proceeded so far as to amend the act of Congress by striking out a section here, and another there.  They can go but one step farther, to-wit :  To interpolate a few lines in this place or that to make the statute agree with what they think it should be.”

“ But you must admit, ” said Mr. Hutchinson, “ that our judges of the Supreme Court are eminent and honorable men, and profound jurists.”

“ I admit nothing of the kind,” was the reply.  “ Most of them were obscure men, never heard of, outside their own bailiwick, until they were elevated to the bench ;  and many of them earned the appointment by slavish servility to the cause of the corporations.  The heroes of 1776, who made the revolution against the government of the English Parliament, of 600 members, never intended that the absolute and ultimate power of this nation should pass into the hands of nine men.  There are no nine men on this round globe fit for such a gigantic trust.  God never created them.  If there are such, then a republican form of government is based upon a delusion and a snare.”

“ And the most threatening part of this business,” continued Mr. Sanders, “ is that these unauthorized judicial aggressions have gone on side by side with twenty other developments of the same kind, in the same direction, all looking to the enslavement of the American people.”


“ What are they ? ” asked the banker.

“ I started yesterday to tell you how the present per capita of currency contrasts with that which we had in 1865 when it was $67.20.”

“ Yes ;  I should be glad to hear you farther on that subject,” said Mr. Hutchinson.  “ We have now about $24 per capita, and that seems to me ample for all the business needs of this country.”

“ First let me call your attention,” said Mr. Sanders, “ to the effect of an abundant currency upon the condition of the people.  I quote from a hostile authority, from a man who did as much harm to this country as any man that ever lived—excepting John Sherman !  I refer to the Indiana banker, the War Secretary of the Treasury.  In his Report to Congress in 1865 he said :

“ ‘ The country as a whole, notwithstanding the ravages of war, and the draft upon labor, is, by its greatly developed resources, far in advance of what it was in 1857.  The people are now comparatively free from debt.  There is an immense volume of paper money in circulation. * * * Trade is carried on more largely for cash than ever was the case previous to 1861, and there is a much greater demand for money than there would be if sales were made, as heretofore, on credit.  So far as individual indebtedness is regarded, it may be remarked that the people of the United States are much less in debt than in previous years.’

“ What a charming picture of an earthly paradise is here presented ?  The people free from debt.  Business on a cash basis.  No land mortgages.  No chattel mortgages.  No one running to the banks to borrow money.  Nobody being devoured by interest charges.  The land smiling like a garden ;  the people happy ;  immigration sweeping over new territories, displacing the prowling savages, opening fields, building homes, creaking the wilderness to blossom as the rose, marrying and giving in marriage, and creating new and mighty commonwealths.  A million soldiers were discharged after that last grand review.  The London Times said that the real test of our institutions was at hand ;  that those million armed men, fresh from scenes of carnage, would inaugurate a reign of rapine and violence from the Atlantic to the Pacific.  I much fear that if they were turned loose to-day Coxey’s army, marching to Washington, would return, drawing cannon and blazing with the fire of rifles.  Then they were absorbed into the body of the people, who greedily welcomed them.  They went to work at once.  Not one of them became a ‘tramp.’  Never was there seen in the world such billing and cooing and love-making and nest-building as took place when these stalwart heroes selected mates and homes and settled down to share in the happiness of a universally prosperous people.

“ But in the general rejoicing there was one class that was unhappy—the money-lenders.  Mankind, for the first time in the history of the world, had escaped from their clutches.  Nobody wanted their money.  Every one had money of his own.  Business was on a cash basis, prices were good, and everybody at work.  They stood scowling at this magnificent picture of human development and happiness, like the devil looking in through the half-opened door of heaven.

“ ‘ This thing,’ they said, ‘ must be stopped.  Ruin must reform this over-abundant prosperity.  We must draw the world back into the whirlpool of our manipulations.’  And so they clamored around the Secretary of the Treasury at that time.  And in the same report in which he painted the magnificent condition of the people out of debt and uniformly prosperous, he urged that the devil must be turned loose in Paradise.  He said :

“ ‘ There is an immense volume of paper money in circulation which must be contracted.’

“ Ah ! there sounded the funeral bell, ringing loud and terrible in the midst of the singing, shouting, hilarious holiday.  But the merry roysterers took no notice of it.  Little did they think that it was the clangor of doom.  That it meant embarrassment, poverty, foreclosure, the desolation of homes ;  sin, death, crime ;  the bankruptcy of whole communities and unparalleled individual suffering.  Little did they know that it summoned the sailor to desert the ship in the harbor, until its rotting sails dropped piecemeal on the moss-grown deck.  Little did the frontierman understand that it was the bugle call to turn back from the wilderness, for the great march of triumphant civilization had halted.

“ And what excuse was there for destroying a condition in which every one was prosperous.  Here we have it in that same report of the Secretary :

“ ‘ The expansion has now reached such a point as to be absolutely oppressive to a large portion of the people, while, at the same time, it is diminishing labor, and is becoming subversive of good morals. * * * There is no fact more manifest, than that the plethora of money is undermining the morals of the people by encouraging waste and extravagance.’

“ Think of that !  Think of this cold-hearted Secretary putting such lies into his official report !  The good times were ‘ absolutely oppressive to a large portion of the people.’  Who were they ?  Not the farmers ;  for they were getting $1.50 per bushel for their wheat, and everything else in proportion.  Not the miners or manufacturers, for the output of mills and mines could not keep up with the demand.  Not the body of the people, for they were, the Secretary has just told us, generally out of debt—an unprecedented condition.  What class is left ?  The money-lenders.  These are the ones who seize upon the medium of exchange, provided by the government for the convenience of the whole population, and monopolize it, and lend it out on terms and conditions that force their fellow men to work for them, while they fatten in idleness.  These were the men to whom the good times and the universal prosperity were ‘absolutely oppressive.’

“ It is true that the Secretary tries to hide the money-lending class behind the workingmen.  He says the abundant supply of money is ‘diminishing labor.’  This is false upon its face ;  for in the same report he says, ‘ There is a larger demand than formerly for money on the part of manufacturers for the payment of operatives.’  Think of that.  Labor was diminished by the good times !  But the manufacturers needed more money to pay their hands.  And Mr. Justice Bradley, of the Supreme Court, said :

“ ‘ It is an undoubted fact, that during the late civil war the activity of the workshops and factories, mines and machinery, shipyards, railroads and canals of the loyal states, caused by the issue of legal-tender currency, constituted an inexhaustible fountain of strength to the national cause.’

“ Here we have the employment of labor, and the consequent prosperity of the country, traced to an abundant legal-tender currency ;  but this Benedict Arnold, McCulloch, at whose doorstep lie the bodies of an infinite number of bankrupts, paupers, murderers, suicides, abandoned women and starving tramps ;  this man, I say, while perfectly aware that an abundant currency sets all the wheels of commerce, trade and labor in motion, had the effrontery to declare that the abundance of money and prosperity ‘ diminished labor ;’  and in the name of labor he turned labor out to starve.

---[It is really too bad, that Mr. Donnelly, as Representative from Minnesota, on March 23, 1866, voted for the Act to reduce currency]

“ Oh it is simply horrible.


“ If Ralph Izard, Senator from South Carolina, had not changed his vote, on Thursday, Jan. 16th, 1794 (see Benton’s Abridg’t of Debates in Congress, Vol. 1, p. 446), McCulloch, the Indiana banker, never would have been Secretary of the Treasury to sacrifice the happiness of the American people.”

“ How is that ? ” enquired Mr. Hutchinson.

“ It was at that time,” said Mr. Sanders, “ that Congress was at work formulating amendments to the newly adopted constitution.  It was then the amendment was adopted and submitted to the people, to which I have already referred, limiting the power to sue a state.  On December 24, 1793 (p. 445 ibid), we read :

“ ‘ Exclusion of bank officers and stockholders from Congress.
    “ The following motion was made and seconded, to-wit :  ‘ That the constitution be amended by adding, at the end of the ninth section of the first article, the following clause :
    ‘ Nor shall any person holding any office or stock in any institution in the nature of a bank for issuing or discounting bills or notes payable to bearer or order, under the authority of the United States, be a member of either house whilst he holds such office or stock, but no power to grant any charter of incorporation, or any commercial or other monopoly, shall be herein implied.’

“ ‘ And it was agreed that this motion should lie for consideration.’

“ And on Thursday, January 16, 1794, it came up again and an amendment was offered that no ‘ person holding any office in the Bank of the United States ’ should ‘ be a member of either House while he holds such office.’  This was adopted by a vote of 13 yeas and 12 nays.  But the question coming up again, on the same day, Mr. Izard, of South Carolina, changed his vote, and it was lost ;  yeas 12, nays 13 ;  and thereupon the matter seems to have been dropped.  If Mr. Izard had not changed his vote this amendment to the constitution would have been adopted ;  and that the people would have ratified it there can be no doubt.  If this had been done it would have become part of the fundamental law of this nation that bankers were not fit persons for the execution of public trusts, and the country would have been saved great suffering and misgovernment.”

“ That is rather hard on my profession,” said Hutchinson.

“ It is and it is not.  There was a time when the Christian world permitted none but Jews to lend money for profit, and this was done because the Jews, it was understood—as an accursed generation—were going to the devil anyhow, and a little superfluity of sin, more or less, could not make much difference to them.  When a man is damned (they thought), he is at the end of his rope, and the difference in temperature of different parts of Satan’s kingdom is something for self-registering thermometers, and not a matter to be considered by ordinary philosophers.

“ But statesmanship has, for its basis, charity, kindliness, philanthropy.  The cast of mind that is required is diametrically opposite from that of the man who contemplates his fellow creatures as subjects to be slaughtered, stripped and devoured.  In the former the magnetic needle of purpose points directly away from the pole of selfishness to the universal good ;  in the latter case all the needles concentrate on self-dipping down, perchance, to the grave and rottenness and oblivion.  And yet we are not to feel incensed against the nut-gathering tribe.  It is their instinct.  They can no more help the cast of their minds than they can the cast of their features, and one generally fits the other.  They are performing a part in the universal panorama.  But while the many are required to accumulate, to a few in every generation is given the serious and thankless task of trying to protect humanity from itself ;  and they can no more help their philanthropy than the others can help their greediness.  The Man-Behind-the-Scenes takes charge of all that, and He knows what He is about.  So while we strive to lift up humanity (for that, too, is part of God’s purpose), let us have all charity for the forest-prowlers, the tigers, wolves and jackals, who cannot, by any exercise of will or conscience, be anything but tigers, wolves and jackals to the end of the chapter.  It is our duty to our wives and little ones that we keep the beasts in the bushes and not permit them to ravage the world and devour the babies.  A wise philanthropy must resist a brutal and destructive selfishness, which will take to-morrow what it cannot carry away to-day, and will continue to prey until the whole land is a desolate wilderness.  The instinct to grab is like all other instincts—insatiable and unreasonable.  Go talk to the bacilli of consumption, swarming in every fiber of the victim’s body, and tell them that if they continue to breed and eat the man must surely die, and ‘ the barren rage of death’s eternal cold ’ will settle down upon them in the silent grave.  Will they stop ?  It is impossible.  Go tell the money-grabbers that they are producing universal ruin, and that at last their victims will rise up and crush them, perhaps amid the horrors of anarchy—with reeking sword and flaming torch.  Will they stop ?  No more than the bacilli.  They cannot.  They are the slaves of their instinct.


“ But let me return to that declaration of the Secretary of the Treasury, in 1865, that the currency must be contracted because the general prosperity was ‘ undermining the morals of the people.’

“ Great God !  That all the horrors of the last thirty years should be inflicted on the people in the name of Morality ! !  That men should be denied work ;  evicted from their homes ;  forced to eat the bitter bread of charity ;  families separated ;  girls driven to lives of shame ;  men enforced to violence and crime or suicide ;  millions compelled to become tramps, wretched half-fed nomads and barbarians ;  the whole peaceful, orderly and beautiful face of society changed to the scowling countenance of universal apprehension, distrust and danger !  And all this brought on the land—in the name of MORALITY—by a lying, hypocritical banker, fresh from his shaving-shop in Indiana.

“ ‘ Morality ! ’  Why this rascal knew perfectly well that sin is, in nine cases out of ten, the bloody sweat of want ;  that idleness is the devil’s chief agency to achieve evil ;  that the empty sack cannot stand upright, and that when he plunged this country into universal ruin, to please the money-lenders, he was placing dynamite under both morality and religion, and endangering the very coherence of human society.

“ ‘ Morality ! ’  He should be whipped to death by a gang of murderers and bankrupts.”

“ Well, well,” said Mr. Hutchinson, “ give over your rage against Mr. McCulloch, who is a very respectable gentleman, and come back to the question of the present per capita of circulation.”

“ Pardon me,” said the other, “ if I let my temper run away with me.  But such things are enough to

‘ Breed a fever in the blood of age,
And make an infant’s sinew strong as steel.’

“ You claimed that we had an abundant currency for all the needs of the country.”


“ Yes ;  about $25 per capita,” said Mr. Hutchinson.

“ Well, France has, according to some authorities, $50 per capita ;  according to others $45 ;  none place it lower than $40.  Why should the people of the United States have less money in circulation than the people of France ? ”

“ The reason is plain,” replied Mr. Hutchinson.  “ In this country a large part of our business is done by checks.”

“ But is there not, or ought there not to be, in every case the money to meet the checks ? ” said Mr. Sanders.  “ If a man draws a check without the money to meet it, you send him to prison.  The check is no substitute for money ;  it simply facilitates the exchange or payment of money.  But the use of checks is only another form of credit.  If I take A. B.’s check for $1,000 and pay a debt with it to C. D., I do it because I have confidence in A. B. and C. D. has confidence in me.  But the question arises, should the business of the country depend upon credit ?  Should it depend upon the solvency of individuals or banks, or their willingness to accommodate their customers ? ”

“But,” replied Mr. Hutchinson, “the people do not need so much money in this country as they do in France.”

“ On the contrary,” replied Mr. Sanders, “ the annual crop of the United States amounts to billions of dollars, and every part of them, every bushel of wheat or corn or oats, and every pound of cotton, or beef or pork or mutton has to be paid for in cash.  The producer has to have his pay in cash.  Only in one instance that I ever heard of were checks used in the purchase of a crop from the farmers.  That was a few years ago, when the millers of Minneapolis could not obtain the necessary currency—it was too scarce—and they bought wheat, through parts of the northwest, with their own checks on the banks of Minneapolis.  But they were accepted with much grumbling by the farmers and merchants, and the practice soon ceased.  But the fact shows not only that money is not abundant enough for the needs of the country, but that it is absolutely essential in quantities proportionate to the great crops we raise in the United States.  Every year, when the crops are to be moved, the whole business of the country is disarranged by the withdrawal of currency from the great money centers to the west and south, and the dangerous strain is not relieved until the crops find their way to the seaboard.  Why then, I repeat, should we have less money, per capita, in this country than they have in France ?  Ours is an expanding population, spreading over a vast continent, one of the greatest subdivisions of the earth’s surface.  France is a small country, comparatively tucked away in one corner of Europe.  Our line of frontier has been advancing for years forty miles each year from west and east.  France has no colonies but a strip along the red-hot coast of Northern Africa.  The United States increases in population about thirty per cent. every ten years.  The French people scarcely increase in number at all.  And yet we, you say, have $25 per capita, and France has about $45.  Why ?  Why should we be chained down in this way when we have the right to supply ourselves with currency just as we do with postage stamps ?


“ What would be said if the government printed only half as many postage stamps as were necessary, and thus put them at a premium ?  Would not the people rise up and drive the knaves and tricksters out of power who were guilty of such an act ?  And is there any more reason why a man should not be able to exchange anything he has to sell for money, than there is why he should not be able to obtain postage stamps for his correspondence ?  There was a time, Hugh McCulloch tells us, when business in this country was conducted on a purely cash basis.  Is not that the normal condition of things ?  Does not credit simply mean a deficiency of cash, which has put cash to a premium, equal to the interest the business man has to pay for its use ? ”

“ But your comparison of money to postage stamps is fallacious,” said Mr. Hutchinson.

“ Why ?  Both represent the credit of the nation.  The postage stamp is simply a little national note, with mucilage on its back.  You take a national promissory note for $5, with green on its back, and the government receives it in exchange for 500 little national notes of one cent each, with gum on their backs.  There is little or no intrinsic value in either.  They represent the faith and credit of the nation, the wealth and power of 70,000,000 people.  They are merely a function ;  they perform an office ;  they are universally accepted tokens ;  and as long as they do the work assigned them you enquire no farther.  You never stop to ask the intrinsic value of the postage stamp.  You know that it will carry your letter from Maine to Alaska—half around the globe.  And what do you care about the intrinsic value of the $5 greenback ?  You know you can swap it for 500 one cent postage stamps, or you can take it to the custom house and pay $5 of duties on goods imported from abroad ;  or you can pay $5 of internal revenue taxes with it ;  or $5 of your income tax, and you know that your neighbor or your creditor will take it, not only because it is legal tender, but because he too can pay duties or taxes or purchase postage stamps or pay debts with it.  It represents the consensus of resolve of 70, 000, 000 people.”

“ But,” said the other, “ you have got to pay money to buy your postage stamps, and you folks propose to issue greenbacks by the wagon load, and give them away.”

“ We never proposed anything of the kind,” said Mr. Sanders.  “ We do not propose to put forth a single dollar of paper money unless we get a full equivalent for it.  If we owe A, B, C and D for services rendered as cabinet ministers, senators, congressmen, soldiers, sailors, officials of all kinds from judges to tide-waiters, and we hand them out an amount of greenbacks equal to the sums we owe them, certainly no one has the right to complain that there has not been a full and adequate consideration for those notes.  Your people, on the contrary, propose to take the faith and credit of the United States, which we chopped up into little non-interest-bearing obligations of $5 or $10 each, and put it forth in the shape of larger notes, for $1,000 or $10,000 each, called “bonds,” bearing interest, and you will furnish us with the chopped chicken-feed we call money, and take your pay in the interest on the bonds.  Now we think the nation can cut up its credit into small bills, without cost, just as well as a few individuals called bankers can do it at large cost to the people, whose credit and legal-tender power is at the back of the transaction in either case.”

“ But,” said Mr. Hutchinson, “ the government is not fitted to go into the banking business.”

“ Just as much, ” said Mr. Sanders, “ as the bankers are fitted to go into the governing business.”

“ But the government cannot receive money on deposit.  and discount merchants’ notes and sell exchange, etc.”

“ Not at all.  It never pretended to.  That is legitimately a banking business and is properly left in the hands of private individuals.  But that is not the question at issue.  The question is, who is to create the money with which that banking business is to be carried on—the banks or the people, acting through their government ?  In all nations the gold and silver and copper and nickel coins have, during all ages, been minted and stamped and endowed with the properties of money by the government.  No nation ever turned this power over to individuals.  No private parties ever ran a mint.”

“ I remember,” said Mr. Hutchinson, “ one instance where the power to coin money was delegated to a private party.  In 1724 the English government conferred on one Wood a royal grant, authorizing him to coin 108,000 ill half-pence and farthings, for circulation in Ireland.”

“ True ;  and Dean Swift attacked the project in his celebrated ‘ Drapier’s Letters,’ and the people refused to take Wood’s money, and he was ruined.  Walpole threatened to arrest Swift, but he was told that it would require an army of 10,000 men to take him, and that a revolution would follow.  So you see the exception you have quoted proves the rule.  And the fact remains, that the bankers of the United States have never claimed the right to coin gold or silver or copper or nickel pieces ; but they do claim the right to put forth paper money.  Now what is the difference between them ?  Gold and silver are not money until stamped with the government stamp.  They are commodities.”

“ But,” said Mr. Hutchinson, “ you can take $1,000 of gold bullion and pay a debt with it anywhere in the world.”

“ Yes ;  if your creditor is willing to accept it.  But you can do the same with $1,000 of wheat or potatoes.  But you cannot force any one to take any kind of commodity unless he chooses to do so.  They are not legal tender.  The legal tender quality is affixed by the government alone, and that to which it is affixed is money and nothing else is.”

“ But our gold coins circulate abroad,” said Mr. Hutchinson, “ they are good on both sides of the Atlantic.”

“ No ;  you are wrong.  You will see no more American coin in England than you will see English coin in America, and when has the private citizen here received an English sovereign in the course of business ?  When you make a trip abroad you buy drafts on London, Paris, Berlin, etc., and if you have any American money in your pocket when you go aboard the steamer, you go to the purser and he gives you English money in exchange for it.”

“ But you must admit that if you found yourself in London with a pocket full of American gold coin you could go to the first bank and sell them for English money.”

“ Yes,” replied Mr. Sanders, “ but you sell it as a commodity, just as you could sell 1,000 bushels of American wheat in a Liverpool granary.  You can get the market price for it.”

“ But the market price of gold is uniform,” replied Mr. Hutchinson.

“ Not at all.  According to the highest financial authorities in Europe, the price of gold leas increased 33 per cent. in the last twenty years, as measured by the value of anything and everything else.”

“ Well,” said Mr. Hutchinson, “ you must admit then that it is reliable.”

“ Yes ;  at the expense of all other commodities ;  at the expense of human labor and its productions ;  at the expense of human life and happiness and virtue ;  at the expense of religion and liberty and everything this earth holds precious.

“ ‘ Let’s shut our gates and sleep ;  manhood and honor
Should have hare-hearts ;  would they but fat their thoughts
With this crammed metal.’

“ All the ancient legends of mankind tell of a dragon which once devoured the sun, the moon the stars and the earth—the Leviathan, the Midgard-serpent, the Dog-Garm, the Fenris-wolf, Seb, Typhon, Lucifer, Set, Satan, the principle of evil in the universe.  The Fiery Dragon has broken loose again on the orderly affairs of this world, and is devouring our globe, with all its glories, interests and beauties.”

“ But you have not yet shown me,” said the banker, “ what is the real per capita of money in circulation in the United States.  Let us leave the Fiery Dragons alone for a while and come down to practical details.”

“ Pardon me for wandering off,” replied Mr. Sanders, but this is so vast a subject, and so obscured by misunderstandings and misrepresentations, that it is difficult to treat it like a proposition in Euclid.


“ Let me see,” continued Mr. Sanders.  “ You claim that there are about $25 in circulation for every man, woman and child in the United States.  I shall try to demonstrate that there is much less.

“ But, in the first place, I would say that the reports issued by the government of the United States are perfectly unreliable.  They are a mass of lies.”

“ What ! ” cried Mr. Hutchinson, “ you don’t mean to say that the government itself puts forth false reports.  Why, it is treason—sacrilege to say so.  If we cannot believe our national officers, whom can we believe ? ”

“ Well, I assert,” replied Mr. Sanders, “ that the reports put forth by the Treasury Department of the United States, at different times, as to the same matters, are utterly contradictory, and one or other of them must be outrageously false.”

“ I would like to see the proof of that,” said the banker.

“ Well, here you have it,” replied Mr. Sanders, reading his figures from a little book he carried in his pocket.

“ The ninth statistical abstract of the Treasury Department for 1885 gave certain statements to show the amount of money in circulation in the United States from 1857 to 1886 ;  and six years afterwards the same Treasury Department made a similar statement as to the amount in circulation during the same years, and the difference between the two statements is so great that one would think they were surely issued by two different nations.  Examine this table carefully and see how much government reports are to be depended upon :

1866................. ......

9th Abstract Aggregate
$ 532,831,079
16th Abstract Aggregate
$ 334,697,774

“ Here, in six years, we find a difference in the reports of the same department of the same government as to the same years amounting to over two billions of dollars !  Either one statement or the other is a base and absolute lie.  The probability is that neither of them is to be de pended upon.  ‘ False in one thing,’ says the old Latin maxim, ‘ false in all.’  We find the solid earth giving away under our feet—temples and towers reel around us, when the agents of the greatest government on earth lie in that ghastly fashion.  How can we build on any statement they put forth ?  How will we know that the books and accounts of the world’s chief republic have not been ‘ doctored ’ by some nasty little clerk, in the interest of the money-power ?  Our faith is shaken in everything.  But worse than all, the sixteenth abstract says that for the years 1865, 1866 and 1867 the money in circulation was, on an average, $683,394,436, while the Secretary of the Treasury, in his report for 1868, says that from September 1, 1865, to September 1, 1867, the currency was reduced by funding and destroying $797,72,317 !  So that the amount destroyed or withdrawn from circulation was $115,000,000 more than the average amount in circulation, and there was therefore $115,000,000 less than nothing in the hands of the people ! !  The question does not seem to have been :  ‘ What were the facts ? ’ but ‘ What kind of statements do the exigencies of the money-power require ? ’  If it could be shown that there was a small amount of money in circulation in 1867, then it answered the contention that our ‘ hard times,’ in 1895, were due to a contraction of the circulation ;  and so the government statistics become plastic in the hands of the government officials.

“ On July 1st, 1893, the Secretary of the Treasury gave, in his official report, the total amount of money in circulation as $2,323,547,977—an immense suns—made up as follows :

Gold coin..................................$519,156,102
Gold bullion..................................73,511,583
Silver dollars...............................419,332,450
Fractional silver coin.................... 78,415,123
Silver bullion...............................119,113,911
Total coin and bullion.............$1,213,5,59,169
United States notes...................... $346,681,016
Treasury notes, 1890.................... 147,190,227
National bank notes.......................178,713,872
Gold certificates.... ........................94,041,189
Silver certificates..........................330,956,504
Currency certificates......................12,405,000
Total paper currency ................$1,109,988,808
Aggregate .................................$2,323,547,977

“ But the Secretary then admits that in the foregoing table he has not only counted in the gold and silver but the certificates put forth to represent them, thus doubling the amount.  This is certainly an extraordinary performance.  And thereupon the Secretary makes another table, and the circulation falls, at one swoop, from $2,323,547,977 to $1,738,954,057—a falling off of more than half a billion dollars !

“ Here are the revised figures :

Gold.......... .................... ....$597,697,685
Silver.... ............................. 615,861,484
Notes.................................. 525,394,888
Total...... ...... ......... ...$1,738,954,057

Or $584,593,923 less than the first figures given !

“ And these revised figures are put forth by the Secretary of the Treasury as the amount of money in circulation among the people !  Mark you !  Among the people !

“And yet in this latter statement of ‘effective money,’ the secretary includes the following amounts of bullion—bars of uncoined metal—that could not circulate among the people any more than could the ore in the gold mines.

Gold bullion ............................ $ 78,541,583
Silver bullion........................... 119,113,911

“ Let us deduct this amount of commodity from the revised table of circulation, $1,738,954,057, and we have left $1,541,298,563.

“ But a large part of this is locked up in the treasury (see p. 17, Report Treasurer for 1893), viz.:

Gold coin...............................$96,519,888
Silver coin........................... 25,636,899
Notes .................... ............. 19,950,496
Total........ ....................$142,107,283

“ Surely that which is in the vaults of the treasury is not in circulation among the people.  We will therefore deduct this sum, $142,107,228, from the revised statement, less the bullion, to-wit :  $1,541,298,563, and we have left $1,399,191,335.

“ But this is not all.  The report on the finances for 1893 shows that there were 3781 national banks in that year, and they were by law required to hold a certain amount of money in their vaults as a reserve fund, not to be put out under any circumstances.  So far as the use of this money among the people is concerned it might just as well be at the bottom of the Atlantic.  On October 3, 1893, this ‘reserve’ amounted to $513,900,000.  Deduct this again from the $1,399,191,335 and we have left $885,291,335.

“ But this is not all.  In 1893 there were in this country 5,685 state, savings, private banks, etc., which held $3,070,462,680 of deposits.  The state laws require a reserve fund for the security of depositors ;  in some cases it is 10 per cent, in others 25 per cent.  Put it at the lowest figure, 10 per cent, and the reserve thus withdrawn from circulation would amount to $307,046,268, which taken from the $885,281,335 leaves us as the real money in circulation $581,255,067.

“ This is a tremendous shrinkage from the $2,323,547,997 first given by the Secretary of the Treasury in his report for July 1st, 1893.  It is down to less than one-fourth.

“ But even this is not all.

“ The Secretary of the Treasury in that report for July 1, 1893, gave the amount of gold and gold bullion in circulation in the United States as $597,697,685.  How did he get those figures ?  He took as his basis the amount of gold coin in the treasury of the United States and the national banks on June 30, 1872, to-wit :  $115,000,000, and added to it the estimated total of gold in circulation, at that time, among the people of the whole country, $20,000,000, and thus obtained a total of $135,000,000.  To this he added all that had been coined at the mints since 1872, with the gain or loss of gold exported or imported, as registered at the custom houses, deducting $3,500,000 used each year in the industrial arts.  As the total amount of gold used in the arts in the world every year is stated by high authority to be about $80,000,000, the sum of $3,500,000 for the United States would seem to be altogether too small.  There is no country where the teeth of the people appropriate so much gold as in the United States.

“ But the Secretary of the Treasury presupposes that every dollar ever coined of gold or silver since 1873 is still in existence.  This is absurd.  In the first decade of the present century there was coined, in one year, 10,000 silver dollars ;  of these only half a dozen are in existence to-day, and these are in the cabinets of numismatists, and are worth hundreds of times their original value, as curios.

“ ‘ Time hath, my Lord, a wallet at his back,
Wherein he puts alms for oblivion.”

“ How many millions of dollars were destroyed in the great Chicago fire, and in the thousands of other fires in this country since 1872 ?  How many have gone down to the bottom of the ocean in the hundreds upon hundreds of shipwrecks ?  How many have been buried in the earth and lost forever ?

“ In the report on the production of gold and silver for 1888, page 42-43, we read :

“ ‘ In years past we have often insisted that there must be an error in the item, because the most industrious inquiry failed to bring to light a very considerable portion of it.  At present there are at least $275,000,000 of the total (gold coin) which cannot be accounted for.”

“  It does not seem reasonable, if there are nearly $600,000,000 of gold coin or bullion in this country, that the reserve of the United States Treasury of $100,000,000 should fall to half that amount ;  and that the government seemed to think it could not replenish its vaults unless it contracted with the Rothschilds, across the ocean.  Surely if there had been $600,000,000 in the hands of the people of the United States, the government could have raised whatever it needed by a popular loan among our own people, without having recourse to foreigners.  The statement is an egregious falsehood, put forth to deceive the people, by making them believe that nearly $600,000,000 of gold is in circulation among them, while east and west, north and south, a gold coin is something rarely or never seen by the citizens of our country.  Let us, therefore, deduct $250,000,000 of non-existent gold from that gross total of circulation, $581,255,067 and we have left $331,255,067.  But this is not all.  In his estimate the Secretary of the Treasury counted in $419,332,550 silver and $77,415,123 of silver coin, or $496,747,673, in all ;  because that was the total amount of silver dollars and fractional silver coin minted from February 28, 1878, to November 1, 1893.  Here again not a particle of deduction is made for the losses by fires, floods, shipwrecks or hoards buried and lost.  We would, I think, be justified in deducting ten per cent, or $49,674,767 ;  but following a recent, clear-headed writer on this subject, we will call it $20,000,000 ;  and deducting this from the $331,255,067 we have left $281,580,300.

“ But we have not yet made any allowance for the paper money destroyed, or lost, or worn out.  There were several millions of the fractional paper currency which was never presented for reduction.  None of it exists to-day out of the cabinets of the curious.  Of the $1,779,685,355 of national bank notes, issued since 1863, $1,570,985,166 have been redeemed, and the remainder, $908,701,189, are probably lost.

“ If, then, we deduct the ten per cent. for the wear and tear, fires and shipwrecks, etc., of the last thirty years, so far as relates to the national bank notes alone, upon the amount now claimed to be in circulation, $178,713,872, and we have $17,871,387, which, deducted from the gross total of all money in circulation, leaves us $263,708,913.

“ I could also deduct a percentage for losses on United States greenbacks but I have shown enough, I think, for my purpose.”

“ I should say so,” replied Mr. Hutchinson.  “ I had to hold my breath as you proceeded.  I began to fear you were going to whittle it all away.”

“ Well, is there anything I have claimed that is not reasonable and probably true ? ” inquired Mr. Sanders.

“ I cannot say as to that just now,” was the reply.  “ I will have to copy your figures and look there over at my leisure.  You certainly make some startling statements.”

“ Let us take these figures, said Mr. Sanders :


as the real amount in circulation to-day, and inquire how much that is per capita.

“ The total population of the United States, according to the census of 1890, was 62,622,250.  Five years have elapsed since that census was taken ;  we are half way through the decade.  Our increase in population, since the establishment of our government, has been at the average rate of 30 per cent. for every ten years.  But let us call it for the present decade only 20 per cent.  Then the growth for five years would be 10 per cent., or 6,262,225.  Add this to the figures shown by the census, and our present population is at least 68,884,475 persons.  Now let us divide $263,708,913, the amount of money actually in circulation, among the citizens of the republic, by 68,884,475, and we have as the

Per capita circulation, 1893.......... $3.84

“ Here, then, we have the difference between 1865 and 1895 :

1865, per capita .... ......... ....... $67.26
1895, per capita .......................... 3.84

“ This is in thirty years.

“ There is a story told about a venerable colored gentleman who went fishing along the bank of a creek, down South.  To his delight he caught a very large catfish.  Vision of a grand banquet that night floated before his mind’s eye.  But, like all mortals, he was unsatisfied ;  he wanted more.  He thought he would continue down the stream and double his splendid luck, and bring joy into the faded eyes of his aged partner.  But it would not do to carry his prize through the sunshine on his journeyings.  He would keep it fresh and take it up on his return.  And so, running a piece of twine through its gills, he selected a deep, cool pool, and returned the fish to its native element, tying the other end of the string to a sapling.  And then he departed in search of further conquests.  He had not been gone long when a youngster of his own complexion, intent on finny spoil, but not favored by the gods, happened along.  He had secured only a very diminutive catfish by an afternoon’s labor.  He caught sight of the string.  He gently lifted it from the water, and his eyes and mouth distended as he contemplated the splendid trophy pendant at the end of it.  The great poet has said :

“ Woman is not in her best moments strong,
But want will perjure the ne’er-touched vestal.

“ And if this be true of woman, as it doubtless is, it is ten times more true of man, and twenty times more true of undeveloped man, to wit :  the boy of any complexion.  And so the young fisherman deftly removed the great fish from the line and substituted his diminutive spoil in its place.  He doubtless thought (for poets simply express the universal sentiments of the race) :

“ ‘ A fair exchange is no robbery,
Much less pure charity.’

“ And then he meandered away.  In the mean time our elderly friend fished on and on, but with poor success.  He was happily unconscious of the great wrong that had been done him :

“ ‘ He that is robbed, not wanting what is stolen,
Let him not know’t and he’s not robbed at all.’

“ And so, smiling over the anticipated supper, which he already smelled in imagination, with all its crisp and appetizing flavors, he came to the scene of the robbery.  He stooped and drew up the string.

“ ‘ Horror on horror’s head accumulate ! ’

“ His eyes popped out.  His hands moved ugly.  At last he spoke, looking around him the while :

“ ‘ Dis is de same place.  Dis is de same poplar.  Dis is de same string.  Dis must be de same fish.  But—gor-amity how you hab shrunk.’

“ And when we look at those figures :

1865, per capita. .................... $67.26
1865, per capita....................... .. 3.84

“ We are ready to cry out, with our venerable colored friend :

“ ‘ Gor-amity how you hab shrunk !’

“ And as the old gentleman’s fish was stolen so has been our currency.  It was a deliberate conspiracy of the money-lending class.  They have wrecked the whole land for their own profit.  They did it deliberately ;  they did it with malice prepense and aforethought ;  it was the question of their profit against the happiness of the whole human family dwelling in this land.  Hugh McCulloch was their mouthpiece.  He said, in 1865, to Congress :

“ ‘ The first thing to be done is to establish the policy of contraction.’

“ And the House of Representatives, December 18, 1865, adopted the following resolution :

“ ‘ Resolved, that this House cordially concurs in the views of the Secretary of the Treasury, in relation to the necessity of a contraction of the currency.’

“ And on April 12, 1866, Congress passed a law to contract the currency (14 statutes at large, 31), which gave the Secretary of the Treasury the power, ‘at his discretion, to receive any treasury notes, or other obligations issued under any act of Congress, whether bearing interest or not, in exchange for any description of bonds authorized by said act, either in the United States or elsewhere, to such an amount, in such manner and at such rates as he may think advisable ; * * * the proceeds thereof to be used only for retiring treasury notes or other obligations issued under any act of Congress.’

“ And this was done because, said Mr. McCulloch, ‘the people are now comparatively free of debt ;’  ‘the people are much less in debt than in previous years ;’  ‘the country is far in advance of what it was in 1857;’  and ‘the plethora of money is undermining the morals of the people ! !

“  And this noble effort to preserve the morals of the people by reducing them to beggary, has continued with but little change or variation from that day to this, during thirty years !  And the great question before our people is whether or not it shall continue through all the future !


“ Congress backing him up and the money-power of Europe and America anxious to get the bonds of the great Republic, the accomplished money-lender of Indiana progressed splendidly in the work of enslaving the American people.

“ On pages 28-9, Messages and Documents, 1867-8, the Secretary of the Treasury, Hugh McCulloch, says :

“ During the month of September, 1865, the army having been reduced to a peace footing, it became apparent that the internal revenues would be sufficient to pay all the expenses of the government and the interest on the public debt, so that thenceforward the efforts of the Secretary were to be turned from borrowing to funding.  Thus the condition of the country and the treasury determined the policy of the Secretary, which has been to convert the interest bearing bonds, notes, etc., into gold bearing bonds, and to contract the paper circulation by the redemption of United States notes.  For the last two years this policy has been steadily but carefully pursued and the result on the whole has been satisfactory to the Secretary.

“ From the 1st of September, 1865, to the 1st of September, 1867, the Secretary says the ‘ reduction in the currency was as follows :

Compound interest notes were
reduced from...........................$217,024,160.00 to $ 72,875,040.00
Seven and three-tenth notes
were reduced from................... 830,000,000.00 to 337,978,800.00
United States notes and frac-
tional currency from.....................459,505,311.51 to 387,871,487.39
A reduction of ......................... $797,725,317.30

and the cash in the treasury has been increased from $88,215,055.13 to $133,998,398.02, and the funded debt has increased $686,584,800, while this has been accomplished there has been no commercial crisis and no considerable financial embarrassment.’

“ ‘ The Secretary continued,’ says Bolles’ Financial History, page 278, to ‘reduce the legal tender notes, though not with regularity, and when Congress convened in December, a considerable stringency existed in the money market.  The price of commodities had declined, and opposition to further contraction was loud and general,’ and an ‘act to suspend the further reduction of the currency,’ became a law February 4, 1868 (15 Statutes at Large, 34).

“ Think of that !  The real money in circulation, according to McCulloch, on July 1st, 1865, was $2,113,606,702.51, and of this $797,725,317.39, or more than one-third was wiped out of existence in two years !

“ But we have talked the day away.  There is the cry for supper—and that is, to the American, what the muzzin cry of the Mohammedan is to prayers—a summons that cannot be disobeyed.”

“ That is,” said Mr. Hutchinson, “ the American is as prompt in his eating as the mussulman is in his praying.”

“ Exactly,” said Mr. Sanders, “ and in this country the physical preponderates over the spiritual.  Hence our inventions are multiplying and our religion decreasing.”

---[From the report of the Comptroller of Currency, December 4, 1865:---