402 PAPER MONEY AND A PROTECTIVE TARIFF. 



now. The evil is not mitigated. The demand for use is not itself 

 stable, and never can be in any people, unless it be in an Indian 

 village, where the quantity of currency does not change much. A 

 nation changes greatly in its demand for currency. Travel is a 

 great consumer of currency. It is the trade of all trades which de 

 mands ready money. 



Q. Do you think the course of the Bank of France the last year, 

 in taking in its notes, has inflicted any injury upon the trade of their 

 country ? 



A. It cannot upon trade; it can upon individuals. It can only 

 attack people who have got debts to receive or pay. The trade 

 itself will be benefited. The nation, then, is not injured, but the 

 individual. 



Q. It must fall most heavily upon the producing classes, who are 

 almost always in debt ? 



A. Very well; give them more time. Postpone the change. That 

 is a question for statesmen to settle. An economist cannot settle it. 

 It depends upon the exigencies of a nation. My argument is to the 

 principle. In some cases you may restore the gold value in six 

 months, in others you may wait six years. In either case I go back 

 to what I said before that the nation must not suffer forever to 

 save individuals from suffering temporarily. 



Q. You regard money as the universal barter, a medium to help 

 the exchange of commodity for commodity ? 



A. The science of all trade is the exchange of two commodities 

 of equal value. The cotton has a value which is the cost of pro 

 ducing cotton. The gold has a value of its own, which is the cost 

 of getting it out of the mine. The exchange of cotton for gold is 

 the exchange of articles of equal value. That makes a thoroughly 

 sound currency. The only reason you are obliged to pass through 

 gold is, as I said before, because trade would be stopped but for its 

 intervention. The sellers of goods would not, in most cases, want 

 the articles buyers had to offer them. 



Q. The only way for that immediate barter is through gold, or 

 paper for which gold can be had ? 



A. Yes; but it does not follow that because gold can be had for 

 that paper that the man who has got the paper will go and get the 

 gold. The only thing is that he feels he can get the gold with it if 

 he wants to. 



Q. Why should not the Government be the issuer of convertible 

 notes and derive the profit from them ? 



A. The answer is this: You cannot get the President of the 

 United States into the Bankruptcy Court. You can put the Direct 

 ors of the Bank of England into it. You cannot rely upon convert 

 ibility with a party of politicians. You can t lock them up in a 

 prison if they don t pay up, but you can the Bank of England, and 

 break it up if it does not give you your gold. In economical prin 

 ciple one is as good as the other, but in political principle the differ 

 ence is enormous. The public would not believe in any paper issued 

 by the Government direct. The principle, as I said before, is sound. 

 The profit belongs to the nation, but a government or a parliament 

 are bad issuers of notes pledged to be paid on demand. 



Q. The best thing the Government could do under the circum- 



