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CONGRESS, UNITED STATES. 



and so known everywhere a forced loan a 

 loan forced by the Government upon its army 

 and upon its other creditors to meet the great 

 emergencies of the war ; and the primary fact 

 connected with every greenback is that it is a 

 promise to pay. Those who believe in re- 

 sumption intend that some time or other the 

 nation shall make good the promise. 



"Now, what are the obstacles to resumption 

 in accordance with the law we have passed ? 

 The first great obstacle stated by gentlemen 

 who have argued the question is this : that we 

 have not enough currency in the country for 

 its business, and that some measure of con- 

 traction will be likely to attend the further 

 execution of the provisions of the resumption 

 law. Before I enter directly upon that objec- 

 tion, I desire to state a fact for the considera- 

 tion of those who hear me. In that prosper- 

 ous era of 1860, when there was free banking 

 in most of the States and the banks were push- 

 ing all the currency they could into circulation 

 without limit, there were just two hundred 

 and seven millions of paper currency, and that 

 was the largest volume that this country had 

 ever known. Now, nobody estimates that the 

 amount of coin in the country in 1860 was 

 more than $250,000,000. The received esti- 

 mate is two hundred millions. Add that sum 

 to the two hundred and seven millions of paper 

 circulation, and you have four hundred and 

 seven millions of currency, paper and silver 

 and gold. How much have we to-day ? This 

 day, or rather on the first day of this month, 

 we had seven hundred and twenty-seven mil- 

 lions of greenbacks, bank notes, fractional cur- 

 rency, and fractional silver ; and if you add 

 the nine millions of copper and nickel money 

 now outstanding, it makes a present volume 

 of seven hundred and thirty-six millions of 

 currency, counting no gold whatever, although 

 the Pacific coast uses a large amount. 



"Now, I put it to the judgment of this 

 House, if under free banking in 1860 four 

 hundred and seven millions was the limit of 

 possible currency that could be kept in circu- 

 lation, how can it be said that almost twice 

 that amount is needed and is hardly enough 

 for the wants of 1877? Have the laws of 

 value changed in seventeen years ? Gentle- 

 men who assert a dearth of currency at the 

 present time must point out the new elements 

 in our fiscal affairs that require three hundred 

 and twenty millions more money than was 

 needed in 1860. No theory of currency that 

 existed in 1860 can justify the volume now 

 outstanding. Either our laws of trade, our 

 laws of value, our laws of exchange, have been 

 utterly reversed, or the currency of to-day is 

 in excess of the legitimate wants of trade. 

 But I admit freely that no Congress is wise 

 enough to determine how much currency the 

 country needs. There never was a body of 

 men wise enough to do that. The volume of 

 the currency needed depends upon laws that 

 are higher than Congress and higher than gov- 



ernments. One thing only legislation can do. 

 It can determine the quality of the money of 

 the country. The laws of trade alone can de- 

 termine its quantity. 



" In connection with this view, we are met 

 by the distinguished gentleman from Pennsyl- 

 vania (Mr. Kelley) with two historical refer- 

 ences, on which he greatly relies in opposing re- 

 sumption. The first is his reference to France. 

 Follow France, says the honorable gentleman 

 from Pennsylvania follow France, and see 

 how she poured out her volumes of paper 

 money, and by it survived a great crisis and 

 maintained her business prosperity. Oh that 

 the gentleman and those who vote with him 

 would follow France ! I gladly follow up his 

 allusion to France. As a proof that we have 

 not enough money, he notices the fact that 

 France has always used more money than 

 either the United States or England. I admit 

 it. But does the gentleman not know that 

 the traditions and habits of France are as 

 unlike those of England and the United States 

 as those of any two nations of the world can 

 be in regard to the use of money ? I say to 

 the gentleman that in France banking as an 

 instrument of trade is almost unknown. There 

 are no banks in France except the Bank of 

 France itself. The Government has been try- 

 ing for twenty years to establish branches in 

 all the eighty-nine departments, and thus far 

 only fifty-six branches have been organized. 

 Our national, State, and private banks number 

 nearly ten thousand. The habits of the French 

 people are not adapted to the use of banks as 

 instruments of exchange. All the deposits in 

 all the savings banks of France are not equal 

 to the deposits in the savings banks of New 

 York City alone. It is the frequent complaint 

 of Americans who make purchases in Paris 

 that the merchants will not accept drafts even 

 on the Bank of France. So long as the busi- 

 ness of their country is thus done hand to hand 

 by the use of cash, they need a much greater 

 volume of money in proportion to their busi- 

 ness than England or the United States. 



" How is it in England ? Statistics which no 

 man will gainsay will show that 95 per cent, 

 of all the great mercantile transactions of Eng- 

 land are done by drafts, checks, and commer- 

 cial bills, and only 5 per cent, by the actual 

 use of cash. The great business of commerce 

 and trade is done by drafts and bills. Money 

 is now only the small change of commerce. 

 And how is it in this country? We have 

 adopted the habits of England, and not of 

 France, in this regard. In 1871, when I was 

 chairman of the Committee on Banking and 

 Currency, I asked the Comptroller of the Cur- 

 rency to issue an order naming fifty-two banks 

 which were to make an analysis of their re- 

 ceipts. I selected three groups. The first 

 group were the city banks ; not, however, the 

 clearing-house banks, but the great city banks 

 not in the clearing-house association. The 

 second group consisted of banks in cities of 



