72 Colorado College Studies. 



prosperity for the oppressed plain people? Many of the 

 advocates of restoration of state bank notes see the diffi- 

 culties distinctly enough to propose that there shall still 

 be some national restriction and supervision. The best 

 that can be said of such plans is that a safe built partly of 

 iron and partly of wood will resist fire better than a safe 

 built wholly of wood. The advocates of an admixture of 

 wood may fairly be asked what good is expected from the 

 change. 



If we are to attempt elasticity, then, common prudence 

 requires the preference of national bank notes to state bank 

 notes; for any tolerable system of so-called state bank 

 notes must include national control so nearly complete 

 that it is really a national bank note system. 



III.— INCREASE OF SCANTY LOCAL CIRCULATION. 



So far as it deals with the increased demand at crop- 

 moving time, this argument for state bank notes is of course 

 mere rejDetition of the argument from elasticity; but a 

 separate place may be given to it because some persons 

 have seriously urged that the permanent stock of money 

 could thus be increased in the regions where a scarcity is 

 now felt. Taken in this sense, even, it is completely an- 

 swered by the answer to the elasticity argument; for if 

 there is any way by which state bank notes could give a 

 larger permanent money circulation to parts of the country, 

 the same way can be provided for national bank notes by 

 national law and supervision. And if this were not so, 

 the proposed advantage of a larger local circulation is im- 

 aginary. Money is sent away from districts where capital 

 is scanty because goods are so valuable to the farmer, the 

 trader and the manufacturer, that they prefer having more 

 goods to keeping a comfortable cash reserve in hand or in 

 bank; indeed they usually borrow besides. Double the 

 money in such a district, and within two months there 

 would be little more than at first, if it were money that 

 could be used in outside payments; in the long run there 



