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PUBLIC DOCUMENTS. 



PUBLIC DOCUMENTS, Message of Presi- 

 dent GEANT, at the commencement of the sec- 

 ond session of the Forty-third Congress, De- 

 cember 7, 1874. 



To tie Senate and Souse of Representatives.' 



Since the convening of Congress, one year ago, the 

 nation has undergone a prostration in business and 

 industries such as has not been witnessed with us for 

 many years. Speculation as to the causes for this 

 prostration might be indulged in without profit, be- 

 cause as many theories would be advanced as there 

 would be independent writers those who expressed 

 their own views, without borrowing upon the sub- 

 ject. Without indulging in theories as to the cause 

 of this prostration, therefore, I will call your attention 

 only to the fact, and to some plain questions as to 

 which it would seem there should be no disagree- 

 ment. 



During this prostration two essential elements of 

 prosperity have been most abundant ; labor and cap- 

 ital. Both have been largely unemployed. Where 

 security has been undoubted, capital nas been attain- 

 able at very moderate rates. Where labor has been 

 wanted, it has been found in abundance, at cheap 

 rates compared with what of necessaries and com- 

 forts of life could be purchased with the wages de- 

 manded. Two great elements of prosperity j there- 

 fore, have not been denied us. A third might be 

 added: our soil and climate are unequaled, within 

 the limits of any contiguous territory under one na- 

 tionality, for its variety of products to feed and clothe 

 a people, and in the amount of surplus to spare to 

 feed less favored peoples. Therefore, with these 

 facts in view, it seems to me that wise statesmanship, 

 at this session of Congress, would dictate legislation 

 ignoring the past ; directing in proper channels these 

 great elements of prosperity to any people. Debt, 

 deT)t abroad, is the only element that can with al- 

 ways a sound currency enter into our affairs to cause 

 any continued depression in the industries and pros- 

 perity of our people. 



A great conflict for national existence made neces- 

 sary, for temporary purposes, the raising of large sums 

 of money from whatever source attainable. It made 

 it necess ary, in the wisdom of Congress and I do not 

 doubt "their wisdom in the premises, regarding the 

 necessity of the times to devise a system of national 

 currency, which it proved to be impossible to keep 

 on a par with the recognized currency of the civilized: 

 world. This begot a spirit of speculation, involving 

 an extravagance and luxury not required for the hap- 

 piness or prosperity of a people, and involving, both 

 directly and indirectly, foreign indebtedness. The 

 currency being of fluctuating value, and therefore un- 

 safe to "hold for legitimate transactions requiring 

 money, became a subject of speculation within itself. 

 These two causes, however, have involved us in a 

 foreign indebtedness, contracted in good faith by bor- 

 rower and lender, which should be paid in coin, and 

 according to the bond agreed upon when the debt was 

 contracted gold or its equivalent. The good faith 

 of the Government cannot be violated toward creditors 

 without national disgrace. But our commerce should 

 be encouraged ; American ship-building and carrying 

 capacity increased ; foreign markets sought for prod- 

 ucts of the soil and manufactories, to the ena that 

 we may be able to pay these debts. Where a new 

 market can be created for the sale of our products, 

 either of the soil, the mine, or the manufactory, a 

 new means is discovered of utilizing our idle capital 

 . and labor to the advantage of the whole people. But, 

 in my judgment, the first step toward accomplishing 

 this object is to secure a currency of fixed, stable 

 value ; a currency, good wherever civilization reigns ; 

 one which, if it becomes superabundant with one 

 people, will find a market with some other ; a cur- 

 rency which has as its basis the labor necessary to 

 produce it, which will give to it its value. Gold and 



silver are now the recognized medium of exchange 

 the civilized world over ; and to this we should re- 

 turn with the least practicable delay. In view of the 

 pledges of the American Congress when our present 

 legal-tender system was adopted, and debt contracted, 

 there should be no delay certainly no unnecessary 

 delay in fixing, by legislation, a method by which 

 we will return to specie. To the accomplishment of 

 this end I invite your special attention. I believe 

 firmly that there can be no prosperous and permanent 

 revival of business and industries until a policy is 

 adopted with legislation to carry it out looking to 

 a return to a specie basis. It is easy to conceive that 

 the debtor and speculative classes may think it of 

 value to them to make so-called money abundant un- 

 til they can throw a portion of their burdens upon 

 Others. But even these, I believe, would be disap- 

 pointed in the result if a course should be pursued 

 which will keep in doubt the value of the legal-tender 

 medium of exchange. A revival of productive in- 

 dustry is needed by all classes ; by none more than 

 the holders of property, of whatever sort, with debts 

 to liquidate from realization upon its sale. But ad- 

 mitting that these two classes of citizens are to be 

 benefited by expansion, would it be honest to give it? 

 Would not the general loss be too great to justify such 

 relief? Would it not be just as honest and prudent 

 to authorize each debtor to issue his own legal tenders 

 to the extent of his liabilities ? Than to do this would 

 it not be safer for fear of over-issues by unscrupu- 

 lous creditors to say that all debt obligations are 

 obliterated in the United States, and now we com- 

 mence anew, each possessing all he has at the time 

 free from incumbrance ? These propositions are too 

 absurd to be entertained for a moment by thinking 

 or honest people. Yet every delay in preparation for 

 final resumption partakes of this dishonesty, and is 

 only less in degree as the hope is held out that a con- 

 venient season will at last arrive for the good work 

 of redeeming our pledges to commence. It will never 

 come, in my opinion, except by positive action by 

 Congress, or by national disasters which will destroy, 

 for a time at least, the credit of the individual and 

 the States at large. A sound currency might be 

 reached by total bankruptcy and discredit of the in- 

 tegrity of the nation and of individuals. I believe it is 

 in the power of Congress at this session to devise such 

 legislation as will renew confidence, revive all the 

 industries, start us on a career of prosperity to last 

 for many years, and to save the credit of the nation 

 and of the people. Steps toward the return to a 

 specie basis are the great requisites to this devoutly 

 to be sought for end. There are others which I may 

 touch upon hereafter. 



A nation dealing in a currency below that of specie 

 in value labors under two great disadvantages : First, 

 having no use for the world's acknowledged medium 

 of exchange, gold and silver, these are driven out of 

 the country because there is no need for their use ; 

 second, the medium of exchange in use being of a 

 fluctuating value for, after all, it is only worth just 

 what it will purchase of gold and silver ; metals hav- 

 ing an intrinsic value just in proportion to the honest 

 labor it takes to produce them a larger margin must 

 be allowed for profit by the manufacturer and pro- 

 ducer. It is months from the date of production to 

 the date of realization. ' Interest upon capital must 

 be charged, and risk of fluctuation hi the value of 

 that which is to be received in payment added. 

 Hence, high prices, acting as a protection to the for- 

 eign producer, who receives nothing in exchange for 

 the products of his skill and labor, except a currency 

 good, at a stable value, the world over. It seems to 

 me that nothing is clearer than that the greater part 

 of the burden of existing prostration, for the want of 

 a sound financial system, falls upon the working-man, 

 who must after all produce the wealth, and the sal- 

 aried man, who superintends and conducts business. 

 The burden falls upon them in two ways, by the dep- 

 rivation of employment and by the decreased pur- 



