184 



CONGRESS, UNITED STATES. 



three and a half times the entire circulation 

 authorized in 1860 by all the States of the 

 Union. 



" The bank circulation of the States in 1862, 

 previous to the greenback issue, had increased 

 somewhat over that of 1860, being $238,671,- 

 210 ; and the amount per capita at that time 

 was $7.59, and the ratio of this circulation to 

 the wealth of the country was at that time \\ 

 per cent. I know that gold and silver consti- 

 tuted in 1860 and 1861 no inconsiderable part 

 of the circulating medium of the country, but 

 I am not able to state the exact ratio it bore 

 to the paper currency probably not greater, 

 however, than one-third or one-half at most. 



" I have given these statistics to the Senate 

 to show that, whether we measure the present 

 volume of our currency by the wealth or popu- 

 lation of the country, the percentage is largely 

 in excess of the paper currency, gold, and sil- 

 ver, which constituted the circulating medium 

 of the country in 1860, and 1862. 



" I have not adduced the facts I have given 

 in respect to the amount of our currency, nor 

 instituted the comparison that its volume bears 

 to that which we had in 1860 and 1862, for 

 the purpose of showing that no more currency 

 is needed at this time to carry on the business, 

 trade, and commerce of the country. Indeed, 

 sir, it is quite evident that at certain seasons 

 of the year, in the fall and winter months 

 especially, there is great stringency in the 

 money market more money being required to 

 purchase and move the crops to market than 

 can be commanded. The President, in his last 

 message to us, has very plainly said so, and it 

 is very clearly implied in the reports laid upon 

 our desks of those gentlemen managing the 

 national finances, whose opinions command 

 our respect. I refer to the Secretary of the 

 Treasury, the Treasurer, and Controller of the 

 Currency ; all of. them qualified, by the posi- 

 tions they hold and their means of information, 

 to speak to us with authority upon this question. 



" The voice of the entire West, if I except 

 capitalists and bankers, who have money to 

 loan, is emphatic that we require more curren- 

 cy. There is one test which I regard as de- 

 monstrative that we have too little money. I 

 refer to the extraordinary high rate of interest 

 which prevails throughout the Western coun- 

 try. There must be a real scarcity when for 

 legitimate purposes money commands 12 per 

 cent. 



"But, Mr. President, I did not rise to dis- 

 cuss this precise question, nor the merit of the 

 many schemes offered to graduate the currency 

 to the wants of production and trade at differ- 

 ent seasons of the year. That is a deep and 

 very difficult question I mean the adjustment 

 of our currency to the legitimate wants of busi- 

 ness, by a plan comprehensive enough to em- 

 brace the present and future, which shall 

 relieve the present distress, and which shall 

 look forward steadily to a return to specie 

 payments, when all the currency now passing 

 as money and all we shall add to it shall be 

 money in fact, in its ready convertibility into 

 gold and silver. In voting for the resolution 

 submitted by the Committee on Finance, I 

 wish it to be distinctly understood I do it in 

 the expectation that the committee will furnish 

 to the Senate a plan by which the volume of 

 the currency may be increased at needed sea- 

 sons without undue inflation. But we must 

 constantly guard against doing any thing which 

 shall disturb the present system of values, de- 

 range prices, or affect materially existing rela- 

 tions between creditors and debtors. Any 

 legislation which shall cause these results will 

 be vicious and disastrous." 



Mr. Fenton, of New York, said : " I do not 

 concur with a prominent Senator on this floor, 

 as reported at a recent lecture by him in New 

 York, that an unfavorable balance of trade is 

 the prime cause of our financial evils. It is 

 bad enough, but, more strictly speaking, an 

 unfavorable balance is rather the effect than 

 the cause. While, therefore, a more favorable 

 state of trade to us is altogether desirable, we 

 shall best promote such a condition by making 

 our currency equivalent to gold. The im- 

 mense expansion of 1836 carried the consump- 

 tion of foreign commodities up to $10.93 per 

 capita under the medium tariff; while under 

 a still lower one, in 1840, the expansion was 

 but $5.21. In this connection, it is not out 

 of place to refer to a coincident increase of 

 trade in the two most notable periods of cur- 

 rency expansion in our previous history. I 

 embrace the year just mentioned, and come 

 forward to another which is still fresh in our 

 recollection. I do not here dwell upon the 

 effects of the tariff, because it does not bear 

 upon my argument upon this point. I only 

 ask that it be kept in mind that taxation not 

 only fails as a remedy for such a condition, 

 but may even aggravate the difficulty. 



'.' In the amount of currency here given I 

 embrace both the circulation and deposits. 

 The affinity observable in this table is broken, 

 as will be seen, only in a single instance, and 

 that is capable of a special explanation, as of 



a condition somewhat similar during the last 

 three or four months. If we were to examine 

 the statistics of reports for the same periods, 

 we should perceive a corresponding tendency 

 to decline, though not as certain and uniform 



