312 THE POPULAR SCIENCE MONTHLY, 



railway may be a foolish and unremnnerative enterprise ; but this has 

 to do with the individuals concerned; the community, in the supposi- 

 titious cases we have made, mighty let us suppose, have been better off 

 had the expenditures of those individuals taken some other form, if 

 the material and the labor had gone into something productive (let us 

 believe there are other good things in the world than economic pro- 

 duction) ; but no injury, no loss, no diminution of wealth has oc- 

 curred and this is the main thing. A passage quoted from Prof. 

 Price in the earlier part of our article affirms this. 



We hear a great deal about the railroad " craze " of a few years 

 ago, and of the immense sums sunk in those foolish and extravagant 

 ventures. But the sums of money commonly mentioned are mislead- 

 ing. As we have fully explained, the money simply changed hands; 

 what was really lost by those enterprises was the goods and bullion 

 exported to pay for the iron purchased abroad, and the food and 

 clothing consumed by the laborers, over and above what their con- 

 sumption would otherwise have been ; in addition to which is the loss 

 of the misdirected energy. This was all very large, no doubt ; but far 

 from being what the figures commonly quoted represent it to be. 

 There is, moreover, no evidence that this loss was anything more than 

 a part of our surplus ; the assumption that it impaired our capital, 

 and depleted our productive resources, is wholly groundless. No 

 one can say, we imagine, that capital was withdrawn from any other 

 pursuit ; that productive industry in any direction was weakened by a 

 secession of its resources by this " craze." The nation was much in 

 the position of a merchant who has many ventures abroad, some of 

 which have proved disastrous. His jirofits are reduced, but his ability 

 to keep his numerous ships afloat is not impaired. Even had the rail- 

 road investments partially reduced our capital, it is really monstrous 

 to assume that we could not have recovered from the blow in much 

 less than four years of time. Whatever the cause of the business 

 prostration may be, it evidently is something that lies deep, some- 

 thing far more serious than the loss of a part of our wealth. A mer- 

 chant who loses all his profits is still enabled to go on ; a merchant 

 who loses even half of his capital is still enabled to go on : how is it, 

 then, that the community is so nearly at a standstill because a por- 

 tion of its surplus was lost ? Distinctly the railway over-specula- 

 tion, hurtful as it was, cannot account for the paralysis in industry 

 which now, four years afterward, so generally exists. 



Not a few people are convinced that paper-money is the cause of 

 the difficulty. " Only return to specie payments," they say, " and all will 

 be right." All the inflation and unhealthful stimulation caused by the 

 greenbacks has ceased to be. It was predicted that a reaction must 

 come upon the return to specie payments. It has come long before. 

 It has come without contraction of the currency, the volume of which 

 has ceased to exercise that hurtful influence that was supposed to 



