Theodore Jerolaman
History and Science of Money

INTRODUCTION

AN eminent divine has truly said:  “All life is battling, all society a conflict of forces;  little worth having is ever got without being wrung from the teeth of opposition.  The student of history sees in every clause of the Bill of Rights the result of some successful battle fought to wrest a particular principle from the dominant class.”

Never before in the history of the world has that condition of human affairs been so crystallized, never before have the forces of oppression been so thoroughly equipped and organized, and never before has the outcome of the conflict been fraught with such mighty import for good or ill to the human race as now.  When we look around the world what do we behold ?  We see in every quarter of the earth vast wealth or teeming abundance surrounded on every side by abject poverty.  In our own land, fairest and most favored of the earth, we indeed see “gaunt poverty stalking helpless through our streets” or lie famishing amidst plenty on every hand;  the fabled sufferings of Tantalus are made a living, breathing reality.  To declare that this condition is not of man’s own production, is an insult and a libel upon a God of boundless love and mercy, and the supreme duty of the hour is for man to search out the cause of this condition and to apply the remedy.  In searching for that cause where must we look ?  Neither war, pestilence, nor famine has ravished our fields or desolated our homes.  The soil never ceases to yield its fruits in marvellous abundance, while the bowels of the earth teem in almost every section with untold wealth.  Then why this widespread ruin and desolation ?  Some very sagely inform us that we are suffering from over-production, others again tell us that the trouble is the tariff.  It is impossible for the difficulty to be over-production while millions of the people are suffering for want of the things produced.  To effectually brand that statement as either ignorance or cruel falsehood, one needs only to understand that the agriculturists of the South and the West, with bountiful crops at their disposal, are largely in a state of destitution, while millions of the toilers of the East are either idle, or but partially employed, and suffering for want of the products of both the East and the West.  No, over-production is not the cause.  Careful scientific investigation discloses the fact beyond the power of successful contradiction that the underlying, fundamental cause is to be found in a vicious, strictly dishonest monetary system, and tariff legislation at most can only aggravate or modify our deplorable condition.

A monetary system which throttles enterprise and paralyzes industry is vicious, and a monetary system that robs one portion of society for the benefit of another is strictly dishonest.  And such is the monetary system with which this nation is now afflicted.

MONEY has been appropriately called “the protoplasm of civilization, and as essential to its existence as oxygen is to animal life;  without money civilization could not have had a beginning, and with a diminishing supply civilization must languish and unless relieved finally perish.”  To many who have not given the subject very deep consideration this assertion may seem to be overdrawn;  and that civilization could survive and the people could live by a system of barter.  A careful consideration of the subject is sufficient to satisfy the most sceptical mind that a system of barter can only supply man’s immediate and commonest wants, that civilization absolutely requires for man far more than that supplied by the forest, or stream, or hamlet, or little spot of earth where he may chance to dwell;  that civilization requires for man a medium of exchange, an instrument of association by which he can command, at his own door if need be, the product of every clime and every nation, whether it be the spices of the Indies, the teas and silks of the Orient, the rich fruits from under the burning sun of the equator, the fish and fur of the colder zones, or any product of the earth that will conduce to his welfare and comfort.

Civilization requires for man something by which can command the avenues of intelligence;  education for himself and family — something through which he can satisfy his taste for science, literature, sculpture, painting, or art in any or all of its varied forms.  All these man now commands through that instrument of association called money, the one thing only which can be used for the storage of labor for future use.  Let one imagine for a moment a person attempting to live by a system of barter.  If a farmer — and no one perhaps is so well calculated to live by that system as the agriculturist — with what would he pay for a postage-stamp ? with what would he pay for the use of the telegraph and the telephone ? and with what would he pay for an extended trip upon the railroad ? and how would that system work with the tailor, and the shoemaker, and the dentist, and the doctor, and the lawyer, and the banker ? and how would it work with those persons who do not produce anything ?  Will any person venture upon even slight reflection to question this statement, that “money is the protoplasm of civilization and as essential to its existence as oxygen is to animal life ?”  Sir Archibald Allison, one of England’s most brilliant historians, has this to say concerning money:

“The two greatest events in the history of mankind have been brought about by a contraction, and on the other hand an expansion of the circulating medium of society.  The fall of the Roman Empire, so long ascribed in ignorance to slavery, to heathenism, and to moral corruption, was in reality brought about by a decline in the silver and gold mines of Spain and Greece;  and, as if Providence had intended to reveal in the clearest manner the influence of this mighty agent on human affairs, the resurrection of mankind from the ruin which those causes had produced was owing to the directly opposite set of agencies being put in operation.  Columbus led the way in the career of renovation.  When he set his sails across the Atlantic he bore mankind and its fortunes in his bark;  the annual supply of the precious metals for the use of the globe was tripled before a century had elapsed, the price of every species of produce was quadrupled, the weight of debt and taxes insensibly wore off under the influence of that prodigious increase.  In the renovation of the industries the relations of society were changed, the weight of feudalism cast off, the rights of man established.  Among the many concurring causes the most important, though hitherto the least observed, was the discovery of Mexico and Peru (their gold and silver mines).”

David Hume says:

“ We find that in every kingdom where money begins to flow in greater abundance than formerly, everything takes on a new face, labor and industry gain life, the merchant becomes more enterprising, the manufacturer more diligent and skilful, and even the farmer follows his plough with greater alacrity and attention.”

And Hume further shows that the only honest money, the best, the soundest money is a money the volume of which increases in exact ratio with population and the uses for money.  In fact, no other money can be sound, no other money can be honest.

In no other way possible can justice and equity be maintained between man and man.  In the multiplicity of debts and obligations amounting to tens of thousands of millions of dollars, all calling for liquidation in money payments, how supremely important to every person engaged in industry and enterprise of whatever kind that the money standard should be of equable and unvarying value ?  In no way possible can that equable and unvarying value be maintained except by an increase of the money volume that will keep even pace with the increase of population and the uses for money.  Any other kind of money is a fraud and a snare, and disarranges all business calculations and transactions and places in the hands of unscrupulous men the most subtle and potent power for robbing their fellow-men, possible for the mind to conceive.

Demand relative to the supply is the sole factor in determining value.  An increase or decrease in demand, without a corresponding increase or decrease in the supply of any article whatever, changes its value in exact ratio.  And this law governs the value of money as perfectly as it does that of any other material on earth.  How absurd then to call a money honest which does not increase in exact ratio with demand !  What stupidity to suppose that an honest system of money can be maintained based upon a single metal, over the volume of which man has scarce more control than he has over the winds of heaven !  What supreme folly to adopt for a money standard a commodity so scarce, so variable, and uncertain of production as gold ! — making money the master and not the servant of man, squarely reversing the order of things plainly set by an all-wise Creator.  That there has been a thoroughly organized and systematic effort to conceal and obscure the true principles of money and to mystify and deceive the people concerning monetary science from the time of the suspension of silver coinage in England in 1798, there can remain no possible shadow of doubt.  The systematic purchase and control of many of the leading dailies in our great cities, by the banking and bondholding interests of this country and of Europe, should of itself awaken grave suspicion in the minds of the American people as to the truthfulness of the financial principles which those journals so fiercely promulgate.  The man who should propose a standard of weight or a standard of length that would greatly expand or contract with every change of temperature, would be regarded as a gibbering idiot, — and yet the adoption of such a standard of weight and length would in reality be crystallized wisdom compared to the selection of a commodity so uncertain as gold for a money standard, as the writer proposes to plainly prove.  And why is the money standard of infinitely greater importance than standards of weight and length ?  Simply because only a portion of man’s products are measured by weight and length, while, on the other hand, money is the measuring instrument which not only measures those products, but every other exchangeable product of human skill, whether of hand or brain;  because money is the pricing instrument of all marketable things upon which man’s material prosperity depends.  Nor is it within the bounds of possibility to maintain a perfectly just and proper system of money based on both metals, gold and silver.  The most that could with reason be expected from such a system would be a vast mitigation of the evils of a currency based upon a single metal.  A man can walk about with two good sound legs far better than he can with only one leg, no matter how many crutches he calls to his aid;  and the body politic is as greatly advantaged by the two metals for a monetary base instead of but one, as the individual is advantaged by two good legs instead of one.  Substantial proof of this fact is not alone founded on reason and common sense, but positive, unquestioned proof is furnished by the illustrious example of France whose monetary system consists of nearly equal parts of gold and silver, strengthened by an ample issue of full legal-tender paper money.

Now, if the production and distribution of gold were so completely under the control of man that its supply for money use could at any and at all times be made to increase in exact ratio with the vast and constantly expanding demand for money, and that money volume properly protected, then would the advocates of a single gold standard have a foundation based, in a measure at least, upon reason and common sense for their contention.  But, in the absence of such a condition, it is just as impossible to make one truthful argument in behalf of a single gold standard as it is to make one truthful argument in defence of vice, or one truthful argument in defence of the claim that black is white, or that two and two do not make four.  And why cannot one truthful argument be made in defence of a single gold standard ?  For the best and most unanswerable of all reasons, that in order to do so it is absolutely essential to ignore and deny the fundamental principle which governs the value of money — namely, quantity relative to its uses, the irrevocable law of supply and demand which governs the value of all things material, to which law money is in no wise an exception.  It is this law which makes it as impossible to produce one single truthful argument in behalf of the single gold standard as it would be to produce one single truthful argument in behalf of some mechanism that ignores and runs counter to the law of gravitation.

The laws which govern the universe are perfect and absolute, and the laws which govern the value of money are just as perfect and absolute as any other in the natural world, and just as easy of solution.  How perfect and absolute are the laws which govern every blade of grass, every bud, flower, and fruit, every grain of sand, every germ of vegetable and animal life, in fact, which govern every one of the countless myriad of things in the universe, animate and inanimate !  This truth can be plainly seen by every one, and yet we are craftily told that money, a simple and pure invention of man, is entirely above and superior to natural law;  one eminent gold-standard scientist going so far as even to vaguely connect the recurring spots upon the sun with the periodicity of financial panics !  That there is an all-powerful and dominant effort to deceive mankind concerning money is entirely too plain for denial.  A thorough knowledge of the motive for that effort will greatly aid one to understand why false statements concerning money are so persistently disseminated.

There is nothing more certain within the whole range of human achievement than the fact that those “who control the wealth of the world control the world itself,” and in the control of the last they fortify themselves in the control of the first.  And this is the gigantic prize which is being fought for upon the world’s chessboard at the present moment.  We find arrayed upon the one side a small but intensely powerful fraction of mankind, fortified by the achieved wealth of the world and fully armed with that perfection of craft and consummate skill that generations of tireless, determined effort has produced and developed into a fine art;  while upon the other hand we find the countless toiling millions of the world’s great hive, the brave and honest producers of the world’s vast wealth, toiling on almost totally unconscious of the tremendous stake that is being played for, the result of which will be either to rivet securely upon them the chains of an industrial slavery that will effectually make them the hewers of wood and the drawers of water for that other small but intensely powerful fraction of humanity, or emancipate the civilized world from the galling fetters of a bondage that has for ages sucked the life-blood of industry, throttled enterprise, and steeped mankind in misery — a bondage that has done far more to brutalize and degrade, to criminalize and impoverish, the human race than all the wars, pestilences, and famines that have ever occurred since the creation of man;  a bondage that stifles the nobler aspirations of man and transforms the germs of brotherly love and sympathy of the human heart into the cruel and pitiless instincts of the beast of prey.  Such an economic condition of human affairs in this supposed enlightened nineteenth century will no doubt seem out of the question to most readers.  To all such the writer asks only a careful and impartial examination of the facts and statements set forth in this treatise on money.  If he has made so much as one false statement in regard to the economic principles of money, that fact can be easily ascertained;  and if he has failed in the slightest degree plainly to disprove the multitude of false statements made by those who seek to establish the cruel monstrosity of a single gold standard, that fact also can be easily shown.

The Rev. T. DeWitt Talmage characterizes the misrepresentations of political campaigns as follows:

“ At every yearly and quadrennial election we have in this country great manufactories of lies. ... Large lies and small lies;  lies private and lies public and lies prurient;  lies cut bias, and lies cut diagonal;  long-limbed lies, and lies with double back-action;  lies complimentary, and lies defamatory;  lies that some people believe, and lies that all people believe, and lies that nobody believes;  lies with humps like camels and scales like crocodiles and necks as long as storks and feet as swift as antelopes, and stings like adders;  lies raw and scalloped and panned and stewed;  crawling lies and jumping lies, and soaring lies;  lies with attachment screws and rufflers and braiders and readywound bobbins. ...”

This description by the Rev. Mr. Talmage may fully cover the diversified variety of election lies, but it would no more describe the exquisitely ornate and skilfully executed lies concerning money than would the crudest wooden god of the Hindoos compare in statuary with the masterpieces of Phidias and Praxiteles, or the rude hut of the Hottentot compare with the Parthenon and Ephesian temple in architecture.

A story is told of a Greek painter who made a picture of fruit so natural that the birds pecked it, and of another Greek painter so much more skilful that he deceived the one who had deceived the birds.  And the monetary liar holds the position among all other liars that the last Greek painter held to all the others in the art of painting.  The monetary liar so skilfully erects a superstructure of falsehood upon a foundation of truth that he readily deceives those who could not be induced to notice the most plausible election lie.  So skilfully does he mix truth with falsehood that the ordinary man of business, however intelligent, becomes mystified and confused in his examination of the subject, and usually concludes that the question is too complex and abstruse for the limited time that he can spare for its examination, and contents himself by assuming that that must be the truth which is so plausibly set before him.

The purport of this treatise on money, is to make the true principles of money so plain that “he who runs may read,” and “the wayfaring man, though a fool, need not err therein.”

CHAPTER II.
THE PRINCIPLE OF VALUE.
THE ONLY KEY TO A CORRECT UNDERSTANDING OF THE MONEY QUESTION.

A WISE person wishing to visit a distant city, makes sure to get on board the right train.  Though scores of other trains are seemingly travelling in the same direction, yet if he fails to get on the right one, sooner or later he will be led astray.  And precisely so with the person who sets out to investigate the question of monetary science:  he must make sure that he is in possession of the right key if he wishes to arrive at a correct conclusion.  The true key, and the only key that will unlock or uncover all the devices that craft and cunning can arrange for man’s deception, is the inexorable, unalterable law of supply and demand — the inexorable law that governs the value of every material on earth, the same law precisely that governs the value of houses, lands, wheat, potatoes, or anything else.  The value of each unit of money is determined by the number of units in circulation;  in other and plainer words, the value or purchasing power of each dollar of money is determined by the number of dollars in circulation.

Quantity relative to its uses is the determining factor.  With a firm hold upon this thread no one need fear going astray in solving monetary problems, no matter how devious, how intricate the labyrinth.  Plato plainly saw this principle of money twenty-three hundred years ago, when he advised for the state, for internal trade, a money having no commodity value — that is, a money without what we erroneously call intrinsic value.  Plato plainly foresaw the evils of a currency the volume of which could be injuriously affected by export.  Six hundred years later Paulus, the Roman jurisconsul, recognized this same principle of money, and it was afterward incorporated in the Pandects of Justinian.  But coming down to more modern political economists, and beginning with John Locke, the latter said:

“ While the same amount of money is travelling up and down the kingdom, alterations in value are truly in other things only;  but if you increase or diminish the quantity of money current in traffic in any place, then the alteration in value is in the money.”

In this assertion Locke plainly recognizes the inexorable law of supply and demand, for “while the same amount of money is passing up and down the kingdom,” he says, “alterations in value are truly in other things only” — that is, changes in the price of goods are not caused by the money, because the amount of money has not been changed;  but that the changes in price are caused by the natural changes in the supply and demand of the goods themselves.  We see this fact constantly illustrated in our everyday life by the changes in price caused by an excessively large or an unusually small crop or supply of grain, fruit, or anything else — a simple illustration of the irrevocable law of supply and demand as affecting value.  But Locke says :

“ If you increase or diminish the quantity of money current in traffic in any place, then the alterations in value is in the money.”

Here, then, is a plain and emphatic assertion that the law of supply and demand governs the value of money, precisely the same as it does that of all other things.  Locke of course assumes it to be understood that he refers only to an increase or decrease in the quantity of money where the demand remains the same, that is, without increase or decrease;  for if the demand should increase or decrease in exact ratio with the increase or decrease in the quantity of money, then the value of the money would not change, the relation of supply to demand being exactly the same.

Adam Smith, in his Wealth of Nations, says:

“ Gold and silver, like every other commodity, vary in their value.  The discovery of the abundant mines of America reduced, in the fifteenth century, the value of gold and silver in Europe to about one-third of what it had been before.  This revolution in their value, though perhaps the greatest, is by no means the only one of which history gives us some account.”

And Adam Smith was supposed to have some knowledge of what he wrote.  David Ricardo, than whom few persons have ever lived who possessed a more accurate knowledge of monetary science, said:  “The value of money in any country is determined by the amount existing;  that commodities would rise or fall in price in proportion to the increase or diminution of money I assume as a fact that is incontrovertible.”

John Stuart Mill testifies to precisely the same effect in other words.  Mill says:

“The value of money, other things remaining the same, varies inversely as to its quantity, every increase in its quantity lowering its value and every diminution of its quantity raising its value in a ratio exactly equivalent.”

David Hume says:

“ It is not difficult to perceive that it is the total quantity of the money in circulation in any country which determines what portion of that quantity shall exchange for a certain portion of the goods or commodities of that country.  It is the proportion between the circulating money and the commodities in the market which determines the price.”

Huskinson says:

“ If the quantity of gold, in a country whose currency consists of gold, should be increased in any given proportion, the quantity of other articles and the demand for them remaining the same;  the value of any given commodity measured in the coin of that country would be increased in the same proportion.”

Professor De Colange says:

“ The rate at which money exchanges for other things is determined by its quantity. ... Supposing the amount of trade and mode of circulation to remain stationary, if the amount of money be increased its value will fall and the price of other commodities will proportionately rise, as the latter will then exchange against a greater amount of money; if, on the other hand, the quantity of money be reduced, its value will be raised, and prices in a corresponding degree be diminished, as commodities will then have to be exchanged for a less amount of money. ... In whatever degree, therefore, the quantity of money is increased or diminished, other things remaining the same, in that same proportion the value of the whole and of every part is reciprocably diminished or increased.”

Senator John P. Jones, in his exhaustive and admirable speech on money before the United States Senate in October, 1893, against the repeal of the Sherman act, says:

“ So absolutely clear are the leading writers that the value of the money unit is in every case, other things being equal, determined by the number of units out, and does not depend on the material of which the money may be composed, that they have not the slightest hesitation in asserting that the rule applies even to uncovered paper money, so that the value of every dollar of gold and silver in circulation is diminished or increased according as the quantity of paper money is increased or diminished;  and reciprocably as to all of these the increase in the number of dollars of either kind diminishing the value of each dollar of the others, while the decrease in the number increases the value of each of the others, without the slightest regard whatever to the material of which either of the dollars is composed.  If this be so, if the value of the unit of money depends, not on the material of the dollars, but on their quantity, what becomes of the gold standard ?  If this be so, inasmuch as silver has been utilized as money since the dawn of creation, why abandon it now, unless senators are prepared to abandon the automatic system altogether ?  If we must, by legislation, compel a change in the value of money (for that is what this measure means), why legislate so that it can change in one direction only, and that the direction which is always favorable to the classes that lend money and live idly on their incomes — the direction most injurious to society, most fatal to industry, most narcotizing to energy ?”

Fawcett says :

“In discussing the laws of price, the principle was established that general prices depend upon the quantity of money in circulation compared with the wealth which is bought and sold with money, and also upon the frequency with which this wealth is bought and sold before it is consumed.  If more wealth is produced, and an increased quantity of wealth is bought and sold for money, general prices must decline, unless a larger quantity of money is brought into circulation.”

That is, no money can be “sound” or “honest” money which does not increase in exact ratio with the increase of population and the uses for money, or, in other words, where the supply of money does not increase evenly with the demand.  In further substantiation of this, Fawcett says:

“The amount of money required to be kept in circulation depends upon the amount of wealth which is exchanged for money.  Hence, cœteris paribus, the amount of money ought to increase as the population and wealth of a country advance.”

Testimony to substantiate this fundamental principle of money from all the ablest economists who have ever written upon money can be added indefinitely.  In fact, never until the present day has there ever been so thoroughly organized and systematic, an effort to conceal and obscure this fundamental principle of money as the organized effort we now see so energetically forced upon the American people, an organized effort systematically executed.  Unless there was a thoroughly organized effort to conceal and obscure the true principles of money, it would be impossible for so many of the leading newspapers to be systematically engaged in teaching false principles of money.  That many of our leading newspapers are so engaged will doubtless seem to many a startling assertion, but the truth of that assertion is susceptible of positive proof.  Neither is this venal condition of the American press so very strange or remarkable when one fairly understands the natural and easy methods by which it has been brought about.  Were all legislation concerning railroads controlled almost wholly by the officers and stockholders of the roads, would it be at all strange if such legislation resulted greatly to the interests of those corporations, while the interests of the people receive but scant consideration ?  More especially if in addition to this the newspaper press was largely owned and controlled by the railroad corporations, and the leading dailies teemed with laudatory editorials of the honest methods and sound policy of the railroad management, with just sufficient adverse criticism to make the people believe that the editors were strictly impartial, and that their sole aim was the people’s interests.  Or, again, suppose that all legislation concerning trusts was largely controlled by the owners and attorneys of the trusts, and they largely controlled the newspaper press, would it be at all strange if such legislation resulted greatly to the interests of the trusts, no matter how detrimental such interests might be to the people generally ?  Well, if such results would be a natural sequence of such conditions, can it be wondered at that financial legislation inimical to the true interests of the people has found place when such conditions accurately represent the conditions under which much of our financial legislation has been accomplished ?  For more than twenty-five years the banking and bond-holding trust has been in the saddle;  that mighty corporation, now grown to colossal proportions, has kept its sappers and miners steadily at work, having for its object the control of Congressional and Presidential elections, and especially the control of the newspaper press, that potent machine for moulding public opinion.  None know better, aye, few know so well as they the absolute necessity of muzzling that palladium of American liberty in order to enslave the freemen of America.  They well understand that with the public press against them all their efforts in that direction would be as futile as to attempt to dam the Mississippi with straw, or to turn the earth backward on its axis.  But shrewdly calculating the magnitude of the task which they have undertaken, and with ability unsurpassed for the treasonable work, they have labored without ceasing and lavished their means without stint, until they now stand upon the threshold of a success far surpassing their wildest dreams at the inception of their effort.  The undertaking has been the most extraordinary in character and magnitude, and the most phenomenal in its success thus far in all recorded history.  Their object in concealing and obscuring the fundamental principle which governs the value of money is plainly seen, when one fairly understands that for them to admit that principle would sweep away every vestige of foundation for that unequalled instrument of power for robbing mankind called the gold standard.  If they should once fairly admit the true principle which governs the value of money, the people would then see plainly that that which the bankers’ newspapers have with such persistent vehemence held up before their eyes as a standard is in reality no standard at all, unless a standard of oppression and injustice can be considered a desirable standard.

To admit the fundamental principle which governs the value of money would plainly show the people that gold can no more be a standard of value than can the temperature on January 1st be a standard of temperature for the rest of the year.  If the value of each dollar of money is determined by the number of dollars in circulation (a law of money as perfect as the law of gravitation), then gold is the least qualified perhaps of any material on earth for a money standard except diamonds, the volume of gold being so variable in amount, and so easily manipulated for selfish purposes by those possessed of the power to do so, that a dollar may have one value to-day, another value to-morrow, and still some other value next week, completely disarranging the most careful business calculations, paralyzing industry of every description, throttling enterprise and leaving in its track death, desolation, and misery no less real than that made by war, pestilence, or famine.  In every transaction where money is exchanged for commodities the money is bought just the same as the commodities, and the money is dear or cheap or normal according to the amount of commodities which it takes to buy it.  It is a matter of absolute necessity to both the material and moral prosperity and welfare of the nation that money should be of uniform, unvarying value.  Contrary to the belief of some political economists the science of political economy is pre-eminently a moral science — imperatively demanding a firm foundation of strict justice.

To point to the commodity gold as a standard of value is just as idiotic if sincere, and just as treacherously dishonest if not sincere, as for an engineer to remove the figures on the dial of his steam gauge and then fasten the desired figures on the end of the indicator, so that whether the indicator travels little or much around the dial it would always point to the desired number of pounds pressure.  There, of course, would remain this difference: that while the action of the engineer concerned only the welfare and safety of a few individuals, the action of those who control the money standard concerns the welfare and safety a mighty nation.

It is said that persons making ascensions by balloon are greatly impressed with the optical illusion that they are standing still and that the earth is dropping away.  The illusion that gold is a standard of value, and that it is only commodities that change in price, is precisely identical with the optical illusion of the man in a balloon.

Prof. Stanley Jevons says that the value of gold fell between 1789 and 1809 forty-six per cent, and from 1809 to 1849 it rose one hundred and forty-five per cent, and from 1849 to 1869 it fell again over twenty per cent.  That it has enormously increased in value within the last twenty or twenty-five years is conceded by all impartial judges.  This great increase in the value of money since 1872 has been caused by the vast increase in the demand for money without any corresponding increase in the money supply — positive proof that the value of money is determined by its quantity under the inflexible law of supply and demand.

It has been said of an eminent Greek that he possessed the art of dissembling in so high a degree that he could make the deepest villainy appear like the highest virtue.  Catiline, the Roman, is also said to have possessed the same art in a high degree.  Could they reappear upon the earth to-day, and take a survey of present economic conditions, no doubt they would stand aghast with open-mouthed wonder to see the artistic flights of skill educed by the dissemblers of monetary science, — as, for instance, a series of articles in the New York Times of January and, February, 1895, running through eleven issues and containing thirty-one chapters, in which the writer, with the most ornate academic conclusions and deductions, attempted to prove clearly that the greenback or national currency which preserved this nation in its hour of extreme peril, and which as the tool of trade and commerce created for this nation thousands of millions of material wealth and placed it in the very forefront of the nations of the earth, did not in reality do any of these things (in his opinion), but, on the contrary, subjected the American people to a net loss of over $2,400,000,000.

Another example in point is a long article fully as scholastic but somewhat less subtle, by Henry Dunning McLeod, which appeared in the New York Evening Post of November 12th, 1894, reprinted in full from the Century Magazine, and which the editor of the Post declared to be the “most crushing reply to the bimetallists” and “trenchant exposure of the bimetallic fallacies” he had ever read.  The entire article was an effort to prove that the commodity value of gold and silver always governed the mint value.  In substantiation of this he cited the historical facts that full-weight coins of either metal never remained in circulation in England or France when the commodity value of the metal was greater than the coinage value.  The cause of the higher commodity value he was very careful not to explain, for the explanation would have swept away his whole contention.  He neglected to explain that a higher commodity value for either metal in one country was invariably caused by a higher mint value in some other with which there were close commercial relations, and that every change in a mint ratio caused a change in the commodity value with the precision of clockwork.  We are commanded to be charitable, but is it not putting too great a strain upon charity to suppose that Henry Dunning McLeod or the editor of the the Evening Post did not fully understand the cause of the greater commodity value of either metal, when any intelligent schoolboy of fourteen could fully do so ?

The purpose of this treatise on money is to clearly expose the sophistries and arguments of the would-be perpetrators of the gold standard;  to take each and every one of the many arguments which they have thus far, advanced, and so place them under the searchlight of truth that every honest man of ordinary intelligence can with little effort plainly see their untruthfulness.

In order that the exact truth may be reached it is imperatively necessary to obtain clearly the true starting-point or foundation.  Without this true starting-point a correct knowledge of monetary science can no more be obtained than can be obtained a correct knowledge of astronomy by assuming that the earth is the centre of the solar system and that the sun and all the planets revolve round it.

Without this correct starting-point all efforts to understand the question must inevitably result in inextricable confusion and disappointment.  But with a full comprehension of the fact that quantity relative to its uses is the sole factor in determining the value of money, all else will be comparatively easy, and we may then safely advance to another point for consideration, that of value.

A RIGID conformity, to pedantic rules would have dictated, perhaps, that a consideration of the thing we call value should have preceded a consideration of the fundamental principle which governs the value of money.  However, this work is not designed far an extended treatise on political economy, but only that portion of it which directly concerns the science of money, though, of course, the question of money is to political economy what the machinery is to a steamship, or the blood to the human system.

Vague and erroneous ideas of what constitutes value are very largely responsible for the dire evils of a vicious monetary system.  Until one has a clear conception of the true nature of value he cannot feel perfectly assured that he is firmly fixed on the very bedrock of truth in assuming that quantity, relative to its uses, is the sole factor in determining the value of money.  Economists themselves are frequently inaccurate and contradictory in defining the nature of value.  Such being the case, can it be wondered at that the people generally fall an easy prey to the craft and cunning of designing men, who who have the most powerful of reasons for deceiving them as to the true science of the creation and distribution of wealth ?

Value, unlike matter, is not a concrete substance, but wholly the result of conditions.  The value of any stated material or thing is entirely dependent upon circumstances, and its value may change just as often, as the conditions change.  Could the same material or thing be placed under one thousand different conditions that material or thing would have one thousand different values, except, of course, when a divergence in one direction just compensated for a divergence in some other.

Herein lies the great secret of commercial prosperity.  Ordinarily those persons will be the most successful in business who, having a foreknowledge of future conditions, can the most accurately gauge the effects upon values that those future conditions will produce.  It is common knowledge of all men that a partial failure for one or more years in the crop or supply of wheat, corn, potatoes, or any other thing, will materially advance the price or cost of that thing.  A total failure for one or more years — demand remaining the same — will enormously advance the price or cost of that thing, while on the other hand an abnormally large that or supply has the opposite effect.  Again, any material interruption of the normal condition of commerce, whether through war, pestilence, famine, blockades, or other disturbances, disarranges in a greater or less degree the values of every article affected by such disturbances.

Furthermore, we find that location is an exceedingly potent factor in determining value.  The same thing may have 100 different values in 100 different places;  for instance, wheat may have a value of 80 cents per bushel in New York city, 60 cents in Chicago, and only 30 cents on the plains of Dakota or Kansas.  Apples and potatoes may sell for $1 per bushel in Boston and only 15 cents per bushel in Michigan.  Eggs may sell at 25 cents per dozen in the city and only 10 cents per dozen in the country.  Facilities for market, cost of transportation, cost of production, in fact innumerable changes in the circumstances under which a thing is placed, will cause innumerable changes in the price of that thing.

The writer has seen virgin forests of magnificent timber, miles upon miles in extent, possessed of little or no value at the time — owing to lack of facilities for lumbering and reaching a market — which, a few years later, when conditions were changed and the difficulties of reaching a market removed, then possessed a marketable value of $10 to $25 and even $50 per acre.

Del Mar, referring to the era of Lycurgus, says:

“ It began to be suspected that the monetary problem was not a mechanical one at all;  that unlike weight, length, capacity, etc., value was not an intrinsic or inalienable at tribute of matter, and therefore that it could not be equitably measured by means of any commodity as a commodity.  What then was value ?  From that time to the present, — that is to say, for nearly thirty centuries — the vaults of the earth have echoed the question, but vouchsafed no reply.  The priests of Egypt, if they knew the answer, preserved it among their numerous mysteries of statecraft, to be sold to tyrants or employed in the service of the gods.  The seers of Chaldæa and Greece, who disclosed to the western world the majestic movements of the heavenly bodies, failed to recognize the nature of value, or else kept it an unwritten secret that it might be employed in the subversion of civil liberty.

“ 'The function of money is to measure value,’ declared the school of Lycurgus, but neither the Spartan sages nor the great Stagyrite who in a later age voiced their philosophical maxims ever registered a definition of value.  However, not to register a definition of value is not necessarily to be ignorant of its function.”

That the money-changers of Wall and Lombard streets and their continental allies have long been thoroughly conversant with the true nature of value down to its minutest tinge or shade there can be no reasonable question of doubt.  The seers of Chaldæa would prove easy victims to their matchless skill in making the ephah small and the shekel great.

“ Value is a relation and therefore cannot be measured, but only expressed or stated,” says Francis A. Walker.  “Value is a ratio,” says McLeod.  “Value is purely relative,” says John Stuart Mill.  “Value is an extrinsic accident or relation,” says Prof. W. Stanley Jevons.

That value is not a concrete substance, — that like faith or hope or joy, or pleasure or pain, or touch, or taste, or smell, it cannot be weighed or measured, must appear to the most unphilosophical mind as a self-evident proposition.

What “woes unnumbered” might have been averted from the human race within even the last half-century, had the acute minds of Adam Smith and David Ricardo and Prof. Stanley Jevons and John Stuart Mill but followed to its logical conclusion the broad foundation that value is only a ratio, a pure creation of circumstances and conditions, instead of trying to make it conform to a venerable superstition.

“ Great is Allah and Mohammed is his prophet,” say, the Moslem.  “Great is the economic edifice and gold is the corner-stone,” say in effect these great economists.  If any be degraded by the comparison it assuredly is not the Moslem.

Is it true, does the reader ask, that these great economists do not follow science to its logical conclusion, but try to make it conform to a petted theory ?  Well, here is the proof :

“Value is a ratio,” says McLeod.  “Value is an extrinsic accident or relation,” says the great W. Stanley Jevons, professor of political economy in Owens College, Manchester, and University College, London.  But when confronted with the alternative of sweeping away the halo of superstition that selfish greed has with such infinite pains enveloped the golden idol, or controverting science, Professor Jevons prefers the latter by declaring:  “Since money has to be exchanged for valuable goods, it must itself possess value.”  Shades of Plato and Aristotle ! weep salty tears in memory of thy mutilated child !

What !  Money possess a ratio ?  Money possess extrinsic accident and relation ?

“Value is purely relative,” says John Stuart Mill in his Principles of Political Economy.

“ The value of money is to appearance an expression as precise, as free from possibility of misunderstanding as any in science.  The value of a thing is what it will exchange for.  The value of money is what money will exchange for, the purchasing power of money.  If prices are low, money will buy much of other things, and is of high value.  If prices are high it will buy little of other things and is of low value.

“ The value of money is inversely as general prices, falling as they rise, and rising as they fall.

“ When one person lends to another as well as when he pays wages, or rent to another, what he transfers is not the mere money, but a right to a certain value of the produce of the country to be selected at pleasure. ...

“It must be evident, however, that the mere introduction of a particular mode of exchanging things for one another, by first exchanging a thing for money and then exchanging that money for so something else, makes no difference in the essential character of transactions.  It is not with money that things are really purchased.  Nobody’s income (except that of the gold or silver miner) is derived from the precious metals;  the (dollars or cents) which a person receives weekly or yearly are not what constitutes his income.  They are a sort of tickets or orders, which he can present for payment at any shop he pleases, and which entitle him to receive a certain value of any commodity that he makes choice of.  The farmer pays his laborers and his landlord in these tickets as the most convenient plan for himself and them;  but their real income is their share of his corn, cattle, and hay, and it makes no essential difference whether he distributes it to them directly or sells it for them and gives them the price.

“ There cannot, in short, be intrinsically a more insignificant thing in the economy of society than money, except in the character of a contrivance for sparing time and labor.  It is a machine for doing quickly and commodiously what would be done, though less quickly and commodiously, without it, and, like many other kinds of machinery, it only exerts a distinct and independent influence of its own when it gets out of order.”*

Here Mr. Mill clearly and explicitly declares the true character of money — namely, that it is merely an invention of man, an instrument for facilitating exchanges, by selecting some convenient material and method with which the value of all things can be estimated.  He clearly states that the coins are not the real wealth, but merely the tickets or orders which entitles the holder to demand from society that portion of its real wealth which those coins or tickets entitle the holder, precisely the same as a ticket to a theatrical performance or a ticket for a ride on a railroad merely entitles the holder to obtain that which the ticket calls for.  The only difference between money and a theatre or a railroad ticket is that the former is a general order upon society for all things, and the latter entitles the holder to only one specified thing.

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* Principles of Political Economy, by John Stuart Mill.  Revised by J. Laurence Laughlin, p. 293.

The purchaser of a theatre or railroad ticket does not examine or stop for one moment to consider the material of which the ticket is composed.  He wishes to know only whether it will perfectly secure to him the desired service.  So long as it perfectly performs this office, there can be no advantage in its being made of the purest gold and studded with the most precious gems, instead of the cheapest material on earth — on the contrary, most likely a disadvantage, being less convenient.

After clearly and forcibly explaining the true character of money and emphatically declaring it to be intrinsically the most insignificant thing in the economy of society, Mr. Mill, in order that the fetish of a gold standard may be sacredly preserved, declares that the very first requisite of a perfect money is value.  In another place he declares that the “ultimate regulator of its value [money] is cost of production.”^[2]  And the sum of his hypotheses in other places is that the cost of production is determined by the value of the money.

Into what an inextricable morass of inconsistencies and contradictions the scientist is plunged who turns aside from the unerring path of truth !  An epitome of Mr. Mill’s deductions we find to be as follows: That money is the most insignificant thing in the economy of society;  that the first requisite of that most insignificant thing is value, that value is a ratio depending wholly upon circumstances and condition;  that money must possess a ratio;  must possess circumstances and condition;  and that the value of money is governed by the cost of production, and the cost of production is determined by the value of the money.

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2 Principles of Political Economy, by John Stuart Mill, revised by J. Laurence Laughlin, p. 292.

Which is about equivalent to saying that the velocity of the earth is governed by the sun’s attraction, and the sun’s attraction is governed by the velocity of the earth.  And this is put forth in our text-books for colleges as the highest wisdom upon the most important subject that concerns man’s material prosperity, and not only man’s temporal condition, but exerting an incalculable influence upon his spiritual welfare, poverty being the prolific parent of degradation and crime.

“Happily,” says Mr. Mill, “there is nothing in the laws of value which remains for the present or any future writer to clear up.  The theory of the subject is complete.”

This vividly recalls a statement of Dr. Phillips, who says:  “In the preface of a medical treatise, written at the beginning of this century, these words appear:  'The present perfect state of medical science renders it impossible to record any further discoveries.  We can only arrange what is already known.’  As a man who should now practise the aforesaid 'perfect state’ of medicine would justly be lodged in jail for manslaughter, we smile at the conceit of this simple-minded doctor.”

But what else might in reason be expected from an economist who regards theory as superior to practice ?  Mr. Mills declares that political economy is essentially an “abstract science, and its method is the a priori and must necessarily reason from assumptions, not from facts;”  that “the conclusions of political economy, consequently, like those of geometry, are only true, as the common phrase is, in the abstract.”

Bacon some three hundred years ago wrote:  “They learn nothing at the universities but to believe.  They are like a becalmed ship:  they never move but by the wind of other men’s breath and have no oars of their own to steer withal.”  And again he says:  “The studies of men in such places are confined and pinned down to certain authors, from which if a man happens to differ he is presently represented as a disturber and innovator.”  That “since all existing colleges were established for the communication of the knowledge of our predecessors,” he proposed “that some college be appropriated to the discovery of a new truth ... to mix like a living spring with the stagnant waters.”  Were Bacon alive to-day he doubtless would see little reason to change his opinion concerning colleges, so far at least as the science of political economy is concerned.

M. Rossi truly says:  “Notwithstanding the pretensions so frequently put forward by politicians and economists, some of the most interesting portions of the sciences they profess are still imperfectly understood.  The important art of applying them to the affairs of mankind, so as to produce the greatest amount of permanent good, has made but little progress and is hardly indeed in its infancy.”

De Quincey in 1844 said:  “Since 1817 political economy had on the whole made no advance,” and indignantly exclaimed:  “Nothing can be postulated, nothing demonstrated, for anarchy even as to the earliest principles is predominant.”

Adam Smith, who is looked upon as the father of modern political economy, and whose great intellect vastly advanced the science in many respects, completely shatters with a single blow the grand edifice that he erected, very much like the cow that has given a pail of nice milk and then kicked it over.  After declaring that “labor is the basis of all wealth, that labor is the only universal as well as accurate measure of value, or the only standard by which we can compare the values of different commodities at all times and in all places,” he says that “the demand for labor can only increase in proportion to the increase in the funds destined for the payment of wages,” and declares money to be “the great wheel of circulation, the great instrument of commerce;”  and says, “it makes a part, and a very valuable part, of the capital of a country or people,” and that when “possessed of it we can readily obtain whatever else we have occasion for.”  “The great affair,” he says, “is to get money.  When that is obtained, there is no difficulty in making any other purchase.”

And then with amazing fatuity Adam Smith coolly kicks over the admirable structure he erected by asserting:  “The attention of government never was so unnecessarily employed as when directed to watch over the preservation or increase of the quantity of money in any country.”

He might with equal propriety have said that the time of an engineer, never was so unnecessarily employed as when engaged in superintending the quantity of water in a steam boiler.

Just what potent influence was brought to bear in making the writings of Adam Smith and John Stuart Mill the highest authorities on the science of political economy in our text-books for colleges to the exclusion of the writings of others far better, may not be a matter of record, and consequently may not be determined;  yet it is but reasonable to assume that much of the same influence has been brought to bear in the past as that which we see at the present time, when our influential journals are used as an all-potent force in shaping public policies.  The situation cannot be better expressed, perhaps, than in the words of a very talented editor of a New York journal, who, speaking for his profession, is said to have used the following language:  “We are the tools and vassals of rich men behind the scenes.  We are jumping-jacks: they pull the strings; we dance.”

Mr. William P. St. John very properly says:  “Public opinion is under a newspaper terrorism in New York. ... Any nobody who will write at length a lot of nothingness adverse to silver money will be accorded certain newspaper space, and be dignified into great authority.  Rejoinder, if complete, and the more complete the more certainly, is denied even a limited space.”

Many of the leading dailies in our chief cities follow the course of the New York journals as accurately as if the plan had been systematically pre-arranged.  Communications have been frequently sent to the New York papers which contained complete refutations of statements which had appeared in their columns concerning monetary affairs;  and those communications were almost invariably refused any space whatever;  strong indications, to say the least, that there is a deep-set and widespread effort to keep the real truth, concerning money as far from the people as possible.

That the civilized world shall for long continue to grope in darkness concerning monetary science seems too incredible for belief.  While it cannot be denied, that for ages repressive measures have been very successful in concealing the truth from the great majority of the people, yet the logic of events, the widespread and almost universal discontent of the people, the growing tendency among the people to investigate public questions for themselves, the loosening of party shackles — are all strong and encouraging indications that repressive measures will cease to avail before the advancing dawn of the twentieth century.

PROFESSOR JEVONS says:  “A student of economics has no hope of ever being clear and correct in his ideas of the science if he thinks of value as at all a thing or an object, or even as anything which lies in a thing or object.  People are thus led to speak of such a non-entity as intrinsic value.”  In this statement Professor Jevons reiterates and emphasizes his other assertion, that “value is an extrinsic accident and relation.”  How, then, it may be asked, can these assertions be reconciled with his other statement, quoted and indorsed by John Stuart Mill, that the first requisite of a perfect money is value ?  Well, they cannot be reconciled, and that is the short of it.  No more than can be reconciled the statement that a single substance can be two separate and distinct things at once, or that, a person can be in two different places at the same time.

It is a manifest absurdity on its face that any substance, on earth can alone of itself possess a ratio.  It anything does possess absolute value regardless of circumstances, then that value is truly in itself, and is intrinsic, and under no earthly conditions can it lose that value.

The question then arises, Is there then any such substance or material which under any and all circumstances does possess absolute value ?

Diamonds, having the greatest market value according to size and weight of any substance known, should naturally be the first thing examined, but only to be abandoned when we consider the fact that should other gems be produced far exceeding the diamond in beauty and brilliancy and entirely superseding the diamond in popular favor, then the value of the diamond would be but a small fraction of its present value, and consequently, the value of the diamond depending upon circumstances, and condition, its value is plainly extrinsic and not intrinsic.

We next turn to gold and silver to look for intrinsic value.  So universally have those metals been associated with the term that Noah Webster has been led into the popular error of referring to “the intrinsic value of gold and silver.”  A very little reflection will convince one that the value of those metals is wholly determined by circumstance and condition, or, in other words, by supply and demand.

To members of the human family shipwrecked upon a desert island and cut off from communication with the rest of the world, a mountain of pure gold and a mountain of pure silver would not have as much value, in all probability, as a loaf of bread and a cup of good coffee.  To such a company a few seeds, a few tools, a few of the commonest and ordinarily the cheapest of man’s needs would have more value than any number of such mountains.  Again, to persons living in the Arctic regions and likewise cut off from communication with the rest of the world, the same quantities of gold and silver would have no value whatever, while food and fuel and good warm clothing might have inestimable value.  There millions of tons of the purest ice would be valueless, while a shipload of the same ice might have a value of thousands of dollars at some city near the equator.

Thus we see that Professor Jevons and John Stuart Mill were absolutely correct in declaring that “value is an extrinsic accident or relation;”  and that they simply stultified themselves when they attempted to hedge upon the question of money and tried to exempt it from the operation of that law.  We have proven by their own words that the value of money is purely relative and determined by supply and demand.  If its value then is relative, how can it at the same time be not relative but separate ?  How can its value be extrinsic and at the same time be not extrinsic but intrinsic ?  The human mind has not yet been developed to the extent that it can comprehend how any one thing can be two distinctly opposite things at the same time.

Innumerable illustrations can be cited to show that value is strictly a relation, and that the value of a11 things is ultimately and permanently determined by demand and supply, and not by cost of production, as declared by John Stuart Mill.

While it is absolutely true that labor in some shape forms the basis of all wealth, as declared by Adam Smith, still that fact in no way proves that all values are determined by cost of production.  Cost of production can affect values only to the extent that it can affect supply or demand.

For instance, a machine may be made by which one man will do precisely the same work that formerly required ten men to do, and may have cost, say, $500.  But another machine may be invented, and made at no greater cost, which will do ten times the work of the other.  Then the former machine will suddenly have lost its value, worth perhaps only a dollar or so for old junk, demand for it having ceased, though it can do precisely as much work as it could before when its value was $500.  The value of the product of the machine may or may not be decreased, just in proportion to the relations of supply and demand.  Rising prices may occur simultaneously with lower cost of production, whenever new demands occur in excess of increased supply.

Large establishments are frequently left with stocks of ready-made clothing from which half the value or more has suddenly been taken away by a change of fashion, without the cost of production having been decreased in the slightest degree.  And this result is by no means confined to wearing apparel of every description, but is found to apply to almost every conceivable thing.  Stocks of furniture that have cost large sums to make suddenly lose a large part of their value by changes in styles, and the same with vehicles of every description.  We frequently see such things sold for a fraction of the cost of production, simply be cause of a radical change in the demand.

Even houses and lands are subject to the same law.  Radical changes in value frequently occur from causes entirely separate from cost of production.  Changes in value may occur from changes in the demand for certain styles of architecture;  changes in value because of location becoming more or less fashionable, entirely due to a change in popular opinion;  changes in value because of a change of location in the centres of trade, which may arise from, one or more of a multitude of causes other than cost of production.

Sometimes large rivers are diverted from their course and new harbors and new cities established effecting immense changes in values in which cost of production has taken no part.  Real estate in villages, towns, and sometimes cities becomes valueless because of the exhaustion of mines, fisheries, lumbering, and other industries without the slightest regard to cost of production, demand for that kind of property having been transferred to other places.  The discovery of a new use will frequently give great value to a material that was formerly worthless.

While we find that ordinarily cost of production is an exceedingly important factor in determining values, yet we see that the higher law of supply and demand can step in at any time and in any place and entirely nullify that of cost of production.

To thoroughly understand the science of money, it is absolutely essential to know that all values are relative;  that the value of money, like every other commodity on earth, is determined by quantity relative to its uses, the inexorable law of supply and demand.

It is this knowledge concerning money that the gold press take infinite pains to conceal from the people, by every device that craft and cunning can suggest.  When the people once come fairly to understand that the only possible honest money under the canopy of heaven is a money the volume of which increases in exact ratio with the increase of population and the use for money — a money perfectly protected by the Government — then will mankind be emancipated from a bondage that has oppressed the human race for centuries;  a bondage that has weighed like an incubus upon mankind, shrivelling and destroying the nobler aspirations of men;  a bondage most obstructive of human advancement, and which in the past has so often held the human race spellbound and powerless as if in the grasp of some unseen, incomprehensible force.  When the great producers of wealth, the toiling millions of God’s humanity, once come to understand fully the fundamental principle which governs the value of money, then, and not until then, will they clearly see that an all-wise, just, and loving God plainly designed that money should be man’s most faithful servant, and not man’s inexorable master.

One by one the false statements of those who are striving to conceal the true principles of money will be rigidly examined, and their sophistries fully exposed.

IN this branch of the science of money strenuous efforts are also constantly made to deceive the people and to obscure the true principles of money.  Their success in this branch of the subject would be in the highest degree ludicrous, were it not for the deplorable and ruinous results.

A very numerous and strange variety of things have been used as money at various periods of the world’s history, and to a certain degree mark the successive stages of man’s evolution from barbarism — that is, if it can be fairly claimed that man has made any material advance from barbarism in the science of money.

It is said that a man lost in the wilderness will naturally travel in a circle.  The student of monetary science cannot resist being profoundly impressed, if not utterly amazed, in noting the many circles described in the monetary systems of the principal nations of the earth.  In the very early or pastoral age sheep and cattle were largely used as legal tender and the standard of payment.  As the agricultural succeeded the pastoral, products of the soil were used, and in countries bordering on the seas products of the sea were used, as, for instance, in Japan rice, in China tea, in various countries of Europe wheat barley, oats, etc;  in Iceland dried fish, in Norway and Greenland sealskins and blubber;  in countries bordering on the Mediterranean, olive oil.  In the early history of the American colonies agricultural products were also used as money, chiefly corn and tobacco.  Beaver skins also were a legal tender, and the poor Indians’ money, wampum, became a legal tender and standard of payment among the early colonists.  In every country and in every age other materials besides gold and silver have been used as money with indispensable advantage to the people, whenever the two precious metals happened to become inadequate in their supply;  and history furnishes us no record of any people giving up in despair because they did not possess gold and silver money, except (and what mighty import is conveyed in that one word except !) when the rulers despotically decreed that they should have no other money.  Then, and not until then, was their prosperity, aye life itself, dependent on the possession of those metals.  Then, and not until then, was the creature elevated above and made superior to its Creator in the so-called enlightened nations.

Archaeological research furnishes conclusive evidence of the great antiquity of the moneys of China and India.  There is historical evidence that the people of India were familiar with the art of coining metallic money previous to the sixteenth century B.C.  Evidences of money which antedate that of India are so meagre and indefinite as to exclude its consideration.  To India then, from whose womb emerged those races of Indo-Europeans whose descendants have occupied so important a place among mankind, must we ascribe the adoption of that system of money which for more than thirty-five centuries has made little or no advance in ethical science.  A country richly supplied with gold and silver by a bountiful Providence, ancient India was periodically despoiled of her rich treasures by invading hordes, so that the opulence of one century was succeeded by the extreme poverty of the next, at one time abounding in gold and silver money and at another period having for money only cowries or some other easily procured but efficient substitute.

Del Mar, in his history of monetary systems, says:

“ Could the monetary experiences of India be gathered for the modern world they would prove of priceless merit, for India has evidently essayed and suffered everything in the way of monetary experiment.  Unfortunately its experience is lost in fable and historical perversions.  As a basis for legislation it is essentially worthless, and the future of the East will have to be gathered from the experience of the West, for there the truth of history has been, at least, far less grossly violated.”

Next to India in the order of antiquity, the moneys of the ancient Greeks claim our attention.  The great Greek historian Herodotus says:  “The Lydians were the first people on record who coined gold and silver into money and traded at retail.”  This statement of that great historian, which has been accepted by so many without question as authentically fixing the earliest period of coined money, is found upon careful research to be wholly misleading.  Much and indisputable evidence is had to prove the presence of coined, money among the Greeks many centuries previous to the time to which Herodotus refers, the eighth century B.C.  The most that can be said in defence of that statement is that he only referred to an improved method of fabrication.  The first method adopted is known to have been cutting or punching coins.  To cite all the evidence on record to prove that coined money was used many centuries previous to that period would be superfluous;  one or two instances will be entirely sufficient.  Plutarch, in referring to Theseus, king of Greece, who reigned in the thirteenth century B.C., says:  “To his money he gave the impression of an ox,” and ascribes several possible reasons for his placing that impression upon his coin.  Among them he suggests that perhaps it was because of the Marathonian bull, but seemingly overlooks the most natural and probable reason, which was that oxen or cattle were the standard legal tender for many centuries during the early history of mankind, and at times constituted a very important part of the medium of exchange.  Had it been on account of the wild Marathonian bull which Theseus captured, the impression would have been emphatically that of a bull, and not that of an ox.  Nor can this supposition be set aside by assuming that the early Greeks were not sufficiently skilled artificers to make a plain distinction between a bull and an ox.  While the early Greeks possessed an uncontrollable inclination to boundless exaggeration, they always retained at bottom a well-defined stratum of practical common sense.

A very authentic and accurate account of coined money in the nineteenth century B.C. is found in Genesis xxiii., where Abraham “weighed out to Ephron four hundred shekels of silver current money with the merchant.”  Shekels were coins, not bullion;  shekels were current money, bullion was not.  The weighing disproves nothing, as all coins were weighed in large transactions, owing to crude methods of manufacture and tendency to abrasion, etc. — causes which have never been wholly removed and which still necessitate the weighing of coin.

With the era of that great Spartan Lycurgus begins the first authentic record of monetary systems, which carefully considered will throw valuable light upon the true science and function of money.  The records which history has furnished us are conclusive in establishing the fact that Lycurgus clearly comprehended the true nature of money;  that he plainly saw the insurmountable objections to a currency so uncertain, so unstable in volume as one based on gold and silver.  The discoveries of new mines or the exhaustion of old ones, the vicissitudes and exigencies of war, the arrival or departure of large amounts of either metal, so completely changed the ordinary course of commercial transactions as to absolutely prohibit any lengthened period of prosperity among the people.  Lycurgus, observing these facts, wholly interdicted the use of gold and silver money, and established a currency composed of iron and bronze discs;  and in order to more perfectly confine these discs to the sole use of money, Lycurgus first destroyed the malleability of the metal.

The iron and bronze money of Lycurgus was identical in principle with our own government or greenback currency, the chief difference being the substitution in the latter of the better adapted and more convenient paper on which to place the stamp of government authority, in lieu of the more cumbersome and less convenient metal, the invention of a paper admirably adapted for money material being only of quite recent origin.

The exact length of time that the money system of Lycurgus prevailed in Greece, history unfortunately does not inform us;  most probably for not less a period than two or three centuries, and possibly for one or two centuries more than that.  That, the money system of Lycurgus exerted a powerful influence in elevating Sparta to the lofty position it held among the Greek states cannot be successfully disputed, and that such an event as a financial panic among the Spartans did not occur during the existence of that currency system can be assumed with absolute certainty.

In the Athenian state a somewhat different currency system seems to have prevailed.  We find from the first authentic records concerning their money that in the time of Solon, some two or three centuries after the time of Lycurgus, the Athenian currency was based upon gold and silver — principally silver — and that the distresses of the agricultural and other classes had become so intolerable that Solon was forced to adopt drastic measures in order to mitigate to any appreciable extent the widespread evil.  The natural and certain appreciation in the value of money, whenever any state has attempted to arbitrarily confine the law of legal tender to gold and silver money only, and to discard all other kinds, produced the same dire evil among the Athenian people that it has among all other people from that day to this.  Solon, observing that the misery of the Athenian people was chiefly due to the scarcity and consequent appreciation of the value of the money, decreed that the amount of silver in the mina (or, as some contend, talent) should be reduced.  Silver, as I have already said, forming the principal part of their money, Solon decreed that the mina of 100 drachmas should contain or represent only an amount of silver that had formerly been represented by 73 drachmas;  consequently 73 of the old drachmas exchanged for 100 of the new coins.  This merely restored the value of the money to the same value that it had formerly possessed in more prosperous times.

This simple act of justice on the part of Solon relieved in a great measure the intense distress of the debtor classes, and stimulated industry through the increased volume of money, that is, through the increased number of units of account.  For that plain act of justice Solon has had the unanimous approval of all men who love the right for more than twenty centuries.  The honor of Solon has never been impugned until the present day, and now only by men so biassed in judgment, so unbalanced in mind that they can see only perfect honesty and sound policy in doubling the value of money and consequently doubling the burdens of all debtors without a shadow of right;  while every effort on the part of those who would prevent the unjust increase in the value of money they vehemently denounce as if it was the greatest crime in the decalogue.

An incident worthy of notice perhaps in connection with the legislation of Solon is one to the effect that friends of Solon, it is said, had obtained information in some way in advance concerning that great lawgiver’s intention, and proceeded to invest largely in Attic real estate, for the purpose of realizing a handsome profit in the inevitable, rise of prices.  If the incident is true, it merely proves the fact that human nature was just about the same in those days as that of United States Senators and others high in authority at the present time, who speculate in sugar and other stocks by reason of advance knowledge concerning intended tariff legislation.

DEL MAR in his History of Monetary Systems, says:

“Both the examples of the Greek republics and the writings of Plato and other philosophers had taught the Romans the advantages of a limited and exclusive system of money issued by the state and having little or no worth other than what it derived from its usefulness and efficiency in measuring the value of commodities and services.  The proof that the Romans were familiar with such a system of money appears in the writings of Paulus the jurisconsul, who enunciated its principles long after the system had ceased to exist.  Had no such system ever existed in Rome, Paulus would have had no warrant in the Roman law for the principles he laid down.

“ As felted paper was unknown, the symbols of this system could most conveniently be made of copper.  Therefore the means necessary, to secure and maintain such a money were for the state to monopolize the copper mines, restrict the commerce in copper, strike copper pieces of high artistic merit in order to defeat counterfeiting, stamp them with the mark of the state, render them the sole legal tender for the payment of domestic contracts, taxes, fines, and debts, limit the emission until the value from universal demand for them and their comparative scarcity rose to more than that of the metal of which they were composed, and maintain such restriction and overvaluation as the permanent policy of the state.  For foreign trade or diplomacy a supply of gold and silver, coined and uncoined, could be kept in the treasury.

“ There are ample evidences that means of this character were in fact employed by the Roman republic, and therefore that such was the system of money it adopted.  The copper mines were monopolized by the Roman state.  The commerce in copper was regulated.  The bronze nummi were issued by the state, which strictly monopolized their fabrication.  The designs were of great beauty.  The pieces were stamped S.C., or ex Senatus Consulto.  They were for many years the sole legal tenders for payment of contracts, taxes, fines, and debts.  Their emission was limited until the value of the pieces rose to about five times that of the metal they contained, and they steadily and for a lengthy period retained this high overvaluation. ... The measure of pieces was the whole number of coins which were legal tender, and which circulated, not merely in Rome, but throughout the empire, after they were reduced to one of the various denominations which were affixed them by law.  Within prudent limits, it made no difference whether the coins were pure or impure, light or heavy, yellow, white, or brown, no one could lawfully stamp them except the state.  The value they bore was (within such prudent limits) whatever the state chose to stamp upon them;  and this principle was so deeply implanted in the Roman law and constitution that it became the groundwork of judicial decisions as to what constitutes a good and lawful tender of money down to and including the period of Sir Mathew Hale.”

Such, in fact, was the monetary system that laid the foundation of the greatness of the Roman Empire, a monetary system that was abandoned through no fault whatever of the system, but owing to internal wars which threatened the very existence of the state itself, and necessitated a return in a great measure to the use of such money as was employed by surrounding nations.  Still, for many centuries the principal money of Rome consisted of copper and bronze coins (possessed of but little commodity value) for the Roman masses, even after gold and silver coins had essentially become the money of the rich.

With the overthrow of the Republic, which began under the dictatorship of Sylla, and was completed under Cæsar, the Roman provinces were deprived of certain coinage privileges which they had long enjoyed, and all the mints ordered to be removed to Rome.  It is quite evident that the Roman authorities of that time were as fully cognizant of the tremendous power which complete control of the currency commanded as are the money-changers of Wall and Lombard streets at the present day.  That coinage privileges along with various other things were extensively used by the Roman emperors as bribes and rewards for services and devotion to the imperial interests is plainly evidenced by the fact that in the fourth century of the Empire, A.D. 273-4, coinage privileges were again extensively scattered throughout the provinces.  The emperor Aurelian ordered the coinage privileges annulled and full control of the coinage centralized in the imperial authority.  This so enraged the moneyers, who had become very powerful in Rome, that they instituted a rebellion which cost Aurelian seven thousand of his veteran troops to suppress.  This in turn enraged Aurelian.  It is said:  “The vengeance which he took was barbarous, unsparing, and impolitic to the last degree. ... The executioners were fatigued;  the prisons were crowded;  the senate lamented the death or absence of its most illustrious members.”

Some idea of the vast wealth which the Roman imperium appropriated through the coinage prerogative may be obtained from the fact that for centuries the coinage of gold by any other nation within reach of the Roman power was rigidly interdicted, and any attempt to coin that metal without Roman authority was regarded as a defiance and equivalent to a declaration of war.  Rome’s insistence upon a monopoly of the coinage of gold is quite easily accounted for by the fact of the vast profits to be made out of the Oriental trade.  In the Orient the ratio was 6¼ or 6½ of silver to 1 of gold.  The Roman ratio when Cæsar seized the reins of government was 9 to I.  Cæsar at once changed the ratio to 12 to 1;  and decreed that all the tributes to Rome should be paid in silver at the rate of 12 silver to 1 gold.  A large part of this silver was exchanged with the Oriental traders at the ratio of 6¼ to 1 of gold.  According to Pliny 100,000,000 sesterces of silver were annually exported to India and China.  By this method the thrifty Roman mind easily secured a profit of 100 per cent on all the silver exchanged for gold with the Oriental merchants;  and, astonishing as the fact may seem, the Roman Empire monopolized the coinage of gold in Europe for nearly a thousand years.  This monopoly was at last broken by the rival Moslem power during the Middle Ages.  The monopoly was perpetuated by enveloping the coinage with the most sacred religious character.  It seems that at every period of the world, the surest, safest, and easiest method of accomplishing any surpassing act of villainy or robbery was by appealing to the religious or virtuous traits of humanity.  An appeal to their religion had the same effect upon the ancient Romans that an appeal to “the national honor” and “national good faith” has upon mankind at the present day.  With this pretence, any supreme act of spoliation can be accomplished, so long as the wolf can be successfully concealed under the lamb’s fleece.

Says Del Mar:  “It would have been sacrilege punishable by torture, death, and anathema for any prince other than the sovereign pontiff to strike coins of gold;  it would have been sacrilege to give currency to any others;  hence no other Christian prince, not even the Pope of Rome nor the sovereign of the western or mediæval empire, attempted to coin gold, while the ancient empire survived.”  The ancient empire was that portion of the Roman Empire whose capital was at Byzantium (now Constantinople) and called the Byzantine Empire — the Roman Empire having been divided, upon the death of Theodosius the Great, between his two sons Arcadius and Honorius, Arcadius the eldest succeeding to the command of the Eastern or Byzantine Empire, which always jealously arrogated to itself the supreme authority.  Del Mar quotes Procopius assaying:  “Every liberty was given by the Basilicus Justinian J. [Byzantine Empire] to subordinate princes to coin silver as much as they chose, but they must not strike gold coins no matter how much gold they possessed.”  And he quotes a number of authorities to the effect that Justinian II. broke the peace of 686 with Abd-el-Melik because the latter paid his tribute in gold which bore not the effigy of the Roman emperor.  In vain the Arabian caliph pleaded that the coins were of full weight and fineness, and that the Arabian merchants would not accept coins of the Roman type, and quotes the exact words of Zonaras.  Justinian broke the treaty with the Arabs because the annual tribute was paid not in pieces with the imperial effigy, but after a new type, and it was not permitted to stamp gold coins with any other effigy but that of the emperor of Rome.  The new gold coins of Abd-el-Melik were equivalent to a defiance of Roman suzerainty, and the war that ensued was the first in a long struggle for supremacy between the crumbling Roman Empire and the rising power of Islam.  It was the devastating contest for supremacy as to who should dominate in the exceedingly lucrative business of “farming” the people through that most potent of all forces;  the coinage prerogative.  The Moslem proved apt pupils in imitating their Roman prototypes in claiming divine authority.

Beginning with Augustus, all the Roman emperors claimed to be the sovereign pontiffs of the world, and by virtue of their religious character claimed supreme control of the coinage prerogative;  even silver coins struck by the pro-consuls under Augustus were stamped “PERMissu DIVI AVGusti” — “by permission of the divine Augustus.”  In imitation of the Romans the Moslem commanders were permitted to strike coins in the field, for the sake of convenience in dividing the spoils, and the division of the spoil was regulated by the Koran:  “Wherever ye seize anything as a spoil, to God belongs a fifth thereof.”  This is the same percentage that the Spanish monarchs afterward exacted from the conquerors of America.

The student of history cannot fail to be impressed with the fact that at every period of the world’s history, whenever some supreme act of greed and rapacity was to be perpetrated, it was impiously done in the name of God and religion, precisely the same as acts of extraordinary greed and rapacity are accomplished at the present time under the cloak of “honesty” and “sound policy.”

To the student of monetary science a careful consideration of Roman monetary experience is of inestimable value.  Precisely as the riches of the Orient (doubtless exaggerated to a wonderful degree) had excited the cupidity and envy of Alexander, so the riches of Gaul aroused the cupidity and avarice of Cæsar, and the spoils gathered by the Roman legions and transported to Rome long supplied, and for the time being strengthened, the victorious armies of Rome;  but in the end the very means which temporarily added to the power of Rome proved to be the instrument that was to work her utter destruction.

Possessed of rich spoils in gold and silver gathered from the conquered provinces, and by sale of the conquered peoples sold into slavery, Rome abandoned and repudiated her former system of money, which had laid the foundation for her greatness and which possessed little or no commodity value, but a money over the volume of which she had complete control, and substituted a system based upon the two precious metals, over the volume of which Rome could at most hold only a precarious control.  So long as the value of the Roman money depended absolutely upon the supremacy of centralized power, the very strongest of all forces, self-interest, was brought to bear in upholding and strengthening that power;  but with the substitution of commodity money, and particularly one in which the most important portion (silver) had greater value outside of Roman authority than it had under it, the very opposite set of forces were put in operation;  then, self-interest too often impelled toward decentralization.  The exhaustion of the wealth of conquered provinces, the decline in the production of gold and silver mines, all tended in the same direction.  The distribution of the coinage prerogative as to silver among the provinces — without doubt designed to strengthen the power of Rome — had in reality the opposite effect from that designed.  It gave birth to a multiplicity of coinages entirely devoid of national homogeneity, such coins being a legal tender only within their own dominions, notwithstanding the fact that the central authority strove rigidly to prescribe the coinage ratio is to silver.

To overcome the difficulty £s.d. were introduced, a device for harmonizing and expressing in money terms the well-nigh numberless variety and sizes of coins.  This term £s.d. is known not to have originated with the Romans, but derived by them from the Persians, and in turn derived by the Persians from nations whose history has been lost in the mists of antiquity.

Thus prevailing conditions rendered the adoption of one such system imperatively necessary.  The sacred character bestowed upon their money by custom and condition proved a powerful incentive for preserving the wonderful diversity of her coinages, the element of humbug being always carefully concealed.

Del Mar thus graphically describes the monetary situation:

“In the last quarter of the third century the Roman empire was divided among four Cæsars. ... Even before this division took place the diversity of bronze and silver coins was so great as to produce confusion.  With four emperors almost daily adopting new designs for coins, and several thousand unauthorized moneyers expelled from Mount Cælius and other places to ply their trade in every province of the Roman empire, the confusion became intolerable.  Without some device by aid of which this maddening variety of types and weights could be readily harmonized and valued it became impossible to carry on the operations of trade.  Such a device was £s.d.

“ The infinite diversity and number of local and imperial silver coins had long since broken down that fragment of the fiduciary system of money which was attempted to be revived by Augustus.  It had effaced all the influences of mine royalties, it had nullified all the effects of mint charges and seigniorage.  The relative value of coins which Rome was formerly content to read in the edicts of her consuls or emperors, she was now almost compelled to determine with a pair of scales.  In proportion as such coins lost fiduciary value, and rested upon that of their metallic contents, so did the empire lose importance to the provinces, and the pro-consuls to the local chieftains.  Furthermore, when money ceased to derive any portion of its value from limitation of issue, or sacerdotal and imperial authority, why might not the pro-consuls feel at liberty to issue circulating money as well as the sovereign pontiff ?  Why not the under-lords as well as the pro-consuls ?  Why not foreigners as well as citizens ?  Why not anybody or everybody ?  Besides this, it is to be remembered that the coins of Rome were designed to illustrate its mythology and history, and that they constituted its most precious and enduring monuments.  Upon them were stamped the story of its miraculous origin, the images of its gods, demigods, and heroes, the symbols of its religion, the spirit of its laws, and the dates of its most glorious achievements.”

To preserve and perpetuate these things, the melting down or defacement of the Roman coin was prohibited by law under the severest penalties.  In consequence, the heterogeneity and diversity of her coinages, the wide disparity in the volume and efficiency of the circulating medium among the widely extended provinces, arising from diverse causes, the diversity of the languages among the Roman subjects, all exerted a powerful influence toward the disintegration of the Roman Empire.

It is plainly evident that the Roman rulers were greatly ignorant of the mighty cohesive force of a single uniform system of money wholly controlled by centralized authority, or else were deluded with the belief that the system of £.s.d. would overcome all difficulties.

Del Mar, referring again to this period, says:

“ Even when it [Rome] got rid of its Thirty Tyrants and reduced the number to six, the diversity of coins and coinages was too bewildering for practical purposes.  To harmonize and regulate these coins as well as for other reasons, £.s.d. was adopted.  Yet by accommodating itself to a diversity of moneys, this system prevented the evil from righting itself through the simple and efficacious means of recoinage.  Dispensing with the necessity of uniformity it encouraged heterogeneity, by rendering it less intolerable, and this facilitated that splitting up and subdivision of the coining authority which characterized the matured feudal system and lent it strength and support.  Devised in part to unify money and centralize authority, it became no insignificant aid to decentralization and feudalism.  On the other hand, but for its influence, the Roman coins, and with them the memories which they invoked and the sacred myths they perpetuated, would have been destroyed and the modern world would have had to read the history of the past in the unmeaning baugs of Scandinavia, the saigas of Frakkland, or the composite scats of the Anglo-Saxon heptarchy.”

FOR many centuries previous to the Norman dynasty, the moneys of England were of the most crude and meagre description: a hybrid assortment of coins and other materials without any regularity or uniformity of coinage;  a mixture of Moorish, Spanish, Arabian, and Roman coins, a system of money poorly adapted for a societary condition above that of the half-civilized tribes.

With the Norman dynasty there was begun under William I. an attempt to establish, on a primitive scale, a national system by the coinage of sterlings, or English pennies of silver.  The Norman kings coined no gold;  one great reason for this probably was because they had no gold to coin.  So scarce indeed were the silver pennies that the landholders’ rents, and even the royal revenues, were largely paid in goats and pigs, corn, cattle, and provisions.  Fairs held at regular intervals, at which the people gathered from all parts of the kingdom to exchange their wares and products without the use of money, were even then an established English as well as Continental custom — a custom that had not become entirely obsolete at the close of the eighteenth century.

The very fact that this crude, laborious, and exceedingly wasteful method — in time and labor — of effecting exchanges should have been continued through so many centuries, shows the exceedingly slow and painful steps that have marked man’s evolution from barbarism to civilization.

The Anglo-Saxon Chronicle gives us a clear insight of the English monetary system in the twelfth century, in recording the fact that, under the reign of Stephen, the barons’ castles, of which there were more than a thousand, were veritable robbers’ dens, from which armed bands periodically sallied forth and laid tribute upon the people in the whole country round.  They seized those whom they suspected of having money and “tortured them with pains unspeakable; for some they hung up by the feet and smoked with foul smoke; others they crushed in a narrow chest with sharp stones.  About the heads of others they bound knotted cords until they went into the brain.”

More than a century later this condition of affairs was but little improved.  We are told that under Edward I. every walled town had to close its gates for fear of robbers;  all highways between market towns were ordered kept clear of underbrush for two hundred feet on each side, to prevent robbers from lying in ambush.  So intense were the sufferings of the people through the scarcity of money that they clamored for the expulsion of the Jews, whom they ignorantly charged with being the cause of all their troubles, the Jews having been licensed by the king to loan money at enormous interest.  This money the king in turn exacted from the Jews for the privileges he granted them, but the clamor of the people was so great that the king ordered the expulsion of the Jews, and it is said that some sixteen thousand of the wretched creatures were driven from the realm, many of them perishing from starvation and want by the way.

This expulsion of the Jews necessitated the adoption of new methods of exploiting the people.  About this time the English Parliament began to take part in shaping English affairs, and a burdensome tax was imposed upon the people.  “Not only every laborer, but every member of a laborer’s family above the age of fifteen was required to pay what would be equal to the wages of an able-bodied man for at least several days work.”  The tax on laborers and their families varied from four to twelve pence each, the assessor having instructions to collect the latter sum if possible, that is, to collect twelve pence when they had it, and four pence any way whether they had it or not.  The wages of a day laborer were then about a penny, so that the smallest tax for a family of three would represent the entire pay for nearly a fortnight’s labor.  This gave rise to the Wat Tyler rebellion, noteworthy from the fact that it was the first important instance on record of an organized effort on the part of labor to resist the oppression of capital.

Beginning with William the Conqueror, the Arabian, Moorish, Gothic, and Roman coins were gradually superseded, to a great extent, by local coinage.  Long previous to the reign of the houses of Lancaster and York, trade and traffic in England fell under the ban of the most execrable system of money possible, so utterly devoid of regularity and system as to be absolutely chaotic.  Moneys of silver, moneys of tin, moneys of lead, moneys of bronze, and moneys of leather, moneys coined by the bishop’s, moneys coined by the barons, and moneys coined by the king;  coins as diverse in their values as the diversity of their coinages.  It became one vast hodge-podge of cocodones, rosaries, steppings, and scaldings; pollards and crockards, mitres and lions;  coins constantly changing in value either by royal edicts or by the hands of the clipper, the sweater, or the counterfeiter;  coins taken into the royal treasury by one valuation and paid out by another, and always and invariably resulting in shearing the humble toiler of a considerable share of his just reward.  This condition of the monetary affairs of England lasted for more than five centuries.  With every attempt to remedy the evil, the difficulties seemed only to increase.  It may be no injustice to assume that this condition of things resulted less from want of correct knowledge than from a lack of earnest desire to institute a monetary system that would have prevented the great body of the people from becoming the helpless prey to those in power.

“It may be doubted,” says Macaulay’s History, “whether all the misery which had been inflicted on the English nation in a quarter of a century by bad kings, bad ministers, bad parliaments, and by bad judges, was equal to the misery caused in a single year by bad crowns and bad shillings.  The evil was felt daily and hourly in almost every place and almost every class;  in the dairy and on the threshing floor, by the anvil and by the loom, on the billows of the ocean and in the depths of the mine.  Nothing could be purchased without a dispute.  Over every counter there was wrangling from morning till night.  The workingman and his employer had a quarrel as regularly as Saturday came around.  The ignorant and helpless peasant was cruelly ground between one class which would give money only by tale, and another which would take it only by weight.”

And so, generation after generation, and century after century, the great mass of humanity have ever been the helpless victims of the superior cunning and unscrupulous greed of those in power.  The industrial millions of England were exploited, farmed, and robbed precisely as were their prototypes in Rome before them, and their prototypes in Greece still earlier.  With amazing effrontery and diabolical cunning, those who now monopolize the control of the nation’s money, and who seek by every art that craft can devise to fortify and strengthen themselves in that control, try to make use of the deplorable monetary systems of England in the sixteenth, seventeenth, and eighteenth centuries as an argument against the free coinage of silver in the United States at the present time.  And they are constantly doing this in the face of the fact that the slightest investigation will abundantly prove that there is not the least foundation for the inference which they draw.  The greatly mooted Gresham law, so-called, or the law of the cheaper money driving out the dearer, never was in the slightest degree anything more than the perfectly natural and inevitable result of a conflict of ratios.

The full-weight coins of either metal always flowed to or from a country just as either metal was valued higher or lower in the coinage ratios, than in the mint ratios of a contiguous country.

If any suppose that this hue and cry against silver by the advocates of a gold standard represents, a phase of the money question of but recent origin, he knows nothing whatever of monetary history.  Three hundred and forty years ago the keen intellect of Bodin testified as follows:

“ For men have so well obscured the facts about money, that the great part of the people do not see them at all.  The moneyers do as the doctors do, who talk Latin before women and use Greek characters, Arab words, and Latin abbreviations, fearing that if the people understood their recipes they would not have much opinion of them.”

A century later the great political economist, John Locke, wrote:

“The business of money and coinage is by some men — and among them some very ingenious persons — thought a great mystery, and very hard to understand.  Not that truly in itself it is so, but because interested people that treat of it wrap up the secret they take advantage of in a mystical, obscure, and unintelligible way of talking, which men, from a preconceived opinion of the difficulty of the subject, taking for sense, in a manner not easy to be penetrated but by men of art, let pass for current without examination.  Whereas could they look into their discourses, inquire what meaning their words have, they would find for the most part either their positions to be false, their deductions to be wrong, or (which often happens) their words to have no distinct meaning at all.  Where none of these be, then their plain, true, honest sense would prove very easy and intelligible if expressed in ordinary and direct language.”

In these plain words of that great economist we clearly see that the hustling monopolist was as plainly in evidence in the time of John Locke as he is at the present day.

After the cruel expulsion by Edward I. of the Jews, whose chief fault seems to have been their frugal economy and thrift, the Lombards came to the front as the most powerful factor in shaping the monetary history of England.  With the plunder and destruction of the Lombards by the king, they in turn were superseded by the goldsmiths, who in like manner were regarded by the king as his legitimate subjects for plunder.

But with the establishment of the Bank of England in 1696 under the reign of William and Mary, the monetary system of England underwent a complete revolution.  The manipulation of the currency passed out from the control of a myriad of petty despots and became consolidated under one colossal monopoly, which in time came possessed of well-nigh omnipotent power to control the commercial destiny of a great nation, a monopoly that attained its full completion under the Peel act of 1844, by which almost supreme control of the English monetary system was surrendered to the Bank of England, giving to that institution a practical monopoly of the circulating medium of the nation and endowing it with absolute power to raise or lower the rate of discount at will;  thus placing in the hands of a corporate monopoly the power to create an “easy” or a “stringent” money market at its own pleasure or profit, and consequently exercising an incalculable power for weal or woe over the industrial millions of a great nation.

And now we come to an event in the history of money that has done more to awaken the mind of man to a true conception of the power and function of money than any previous event in the history of the human race.  In 1797, owing to the exigencies of war, the Bank of England was forced to suspend specie payments and to issue irredeemable paper money.  War, and war alone, has possessed the power to reveal the true character of money and present it to the human gaze unmasked of the garb of false pretence that selfish power at all other times has so successfully clothed that money abdicates the position of master and assumes its true place, that of servant.  War alone has the power to reveal clearly the ridiculous insufficiency and cowardly character of gold-basis money.  When in 1797 England abandoned the specie basis she issued an irredeemable paper money until her currency volume was trebled.  Gold and silver skulked to their hiding-places, as they always do in time of war.

The effect upon trade and industry of the great increase of the currency volume was marvellous.  Her revenues rose from 115 millions of dollars in 1797 to 360 millions of dollars in 1815.  In those few brief years England conquered the world of commerce and increased the diversity of her industries more than threefold.  Its wonderful effect has been described in history as follows:  “The conquest in arts and arms during the eighteen years of expansion of pure fiat credit were without example in the history of England, and her progress in wealth and power was without a parallel in the history of the world.  She won the sovereignty of the seas at Trafalgar and the first military place in history at Waterloo.  She became during this period matchless in the possession of every incident of greatness, wealth, and power.”

That England should abandon a system that brought such wonderful prosperity for one which brought universal desolation would seem incredible if we did not understand the methods by which it was brought about.  The serpent in the garden sang the song of greater prosperity by a speedy return to specie basis and the gold standard.  In this instance, like all others of the kind, the contractionist sharks were loud in their assertions that the contraction of the currency, which began in 1816, was solely for the benefit of the producing classes, the laboring-man.  With this period began a radical evolution in the method of transferring wealth from its rightful owners to the pockets of those who are in no wise entitled to it.  The battle-axe and strongbow and the bludgeon gave place to an entirely different plan of robbery.  A far more efficient and refined method than that of taking possession of property by brute force was at this period discovered.  Well might the originators of the scheme shout “Eureka!” when a plan for robbing mankind was discovered in which the ones robbed approved and assisted in their own undoing, and the masters of the game were hailed as patriots and statesmen by the very victims of their oppressions.

The vulgar plan of clipping and sweating and forging and filling coins, the receiving by weight and paying out by tale, the former regular methods of the English kings of buying by pounds Troy and selling by pounds Tower, as methods of robbery were no more to be compared to the new plan than can the slow-moving ox-team be compared to the swiftest railroad trains as a means of travel.  This new and refined plan of robbery was not to increase the number of dollars or pounds or shillings in a debtor’s bond.  Such robbery would be only too apparent to the most obtuse mind, and dangerous in every ease where force or forgery could be proved.  Oh! no, indeed;  the new plan involved no risk, for the very law which was broken in spirit was employed as its most efficient assistant in practice.  The new and refined plan was not to disturb the number of the debtor’s dollars, but by consummate skill and craft engage the help of the debtor himself in increasing the value of the dollars.

The vast national debts which the continental wars created presented a new and almost boundless world of wealth for the Napoleons of finance to conquer.

The first move on the chessboard of this mighty game began in 1798, one year after the suspension of specie payments by the Bank of England, when a seemingly innocent and trifling bill was quietly smuggled through Parliament limiting or practically suspending silver coinage.  This was followed in 1816 by a bill which demonetized silver, and placed England on the single gold standard.  The reader will carefully notice that these acts were accomplished at a time when not one shilling of coin was in circulation in England, resumption of specie payments not occurring until several years later.  He will carefully notice how closely the example there set was followed by the American Congress three-quarters of a century later, when the legal-tender silver dollar was demonetized in 1873 at a time when not one dollar of coin was in circulation.  It seems perfectly natural that those whose deeds are evil prefer darkness to light.

The victory of the fund-holding classes of England in 1816 was completed, and then they commenced systematically to contract the currency.

The effect upon the toiling millions of old England was frightful in the extreme;  in a short time “money became scarce, industry paralyzed, debts multiplied, and famished thousands walked the streets vainly seeking for work to keep their wives and little ones from starvation.  In the month of August, 1820, 60,000 rioters assembled in Manchester demanding bread.  These were dispersed by the troops and many of them shot dead,” while the fund-holding and fixed-income classes serenely proceeded in their work of spoliation.  The currency volume of England was contracted in a few brief years to one-third of the circulating medium in 1815 — contracted for the sole purpose of enriching the fund-holding and fixed-income classes.  As a direct result of that contraction, which began in 1816, more than 120,000 farmers were deprived of their landed possessions.

This awful experience of England has been repeated by the experience of other nations time and again;  and yet the men who are now engineering the present struggle for a single-gold standard declare with the most amazing effrontery that the volume of money in a country has little or nothing to do with establishing prosperity, industry, prices, or wages, and declare that quantity is nothing and that quality and confidence are everything, and adroitly strive to prove that a gold money represents the highest form of those conditions.  With the powerful aid of a mighty newspaper press that for thirty years they have labored to control by purchase, by subsidizing, and by other methods, and by the employment of pseudo-scientific professors, all the arts that craft and skill can devise are sedulously employed to confuse and mislead the American people as to the plain and simple truth of what really constitutes a perfectly honest and sound monetary system.