SCIENCE -Supplement. 



FRIDAY, MARCH 19, 1886. 



VIEWS OF ECONOMISTS ON THE SILVER 

 PROBLEM. 

 I. 



What laws should congress enact, regulating 

 the coinage of silver at the present juncture? To 

 this question, nakedly put, I am obliged to answer 

 that I do not know. The reason I do not know is, 

 that I am not in possession of the minute knowl- 

 edge necessary to enable me to give a satisfactory 

 answer to the question. It is extremely necessary 

 to the smooth and orderly course of business that 

 the current dollar, when measured in terms of 

 human labor, should vary as little as possible 

 from year to year and from generation to gener- 

 ation. If we compare the value of the gold in a 

 gold dollar with the value of the silver in a silver 

 dollar, we shall find that the former, instead of 

 being equal to or less than the latter, as it was up 

 to 1873, is twenty-five per cent greater. Taking- 

 gold as a standard, the value of the silver in a 

 dollar has fallen twenty per cent. Taking silver 

 as the standard, gold has appreciated twenty-five 

 per cent. If the silver dollar is the least variable 

 one, then silver coinage should be free, provided 

 that the proper quantity of silver is put into the 

 dollar ; otherwise gold should be the standard. 

 Thus the first question which meets us is whether 

 the silver or the gold standard is the least variable, 

 when measured in terms of human labor. 



Now, this is a question of fact, to be settled, not 

 by speculation or by abstract reasoning, but by a 

 careful and exhaustive analysis of manufactures, 

 prices, wages, and industry, not only in this 

 country, but in the leading countries of the 

 world. Without this analysis, nothing I could 

 say on the subject would be final. It would 

 take me a year, and would require help from 

 a great number of experts, to make the neces- 

 sary statistical investigation ; and I have not the 

 time to do this. When considering the problem, I 

 feel as if on board a ship in a narrow channel, on a 

 dark night, listening to a discussion among the sail- 

 ors as to whether they shall steer to the right or 

 left. If they ask me what they shall do, I answer, 

 that the only way I see to proceed is to take sound- 

 ings from point to point until they determine, as 

 nearly as possible, where the middle of the 



channel is, and then to follow it as closely as 

 they can. 



Have I, then, no impression or views whatever 

 on the subject ? I reply, that I have no views so 

 well founded but that I would like better ones 

 before advising action. My impressions I am 

 ready to give, with the proviso that I retain the 

 right to reverse them to-morrow if any new 

 light of a nature to change them is thrown on the 

 subject. 



Firstly, to begin with the subject in its more 

 remote and general bearings, I am of opinion that 

 a dollar composed of a fixed weight of either of 

 the precious metals will not serve the purposes of 

 the world's business indefinitely. The increase 

 of wealth must, it seems to me, make gold more 

 valuable, unless the supply is continually in- 

 creased. Without being able to give an exhaus- 

 tive investigation of the subject, the impression 

 which I have derived from statistical tables is, 

 that the consumption of gold in the arts the 

 world over is now fully equal to the annual 

 supply, and is continually increasing. If the lat- 

 ter is not increased, the former will speedily 

 exceed it, and then the stock of gold on hand, 

 and available for money, will slowly diminish. 

 The necessary result will be an appreciation harm- 

 ful to the standard. 



Secondly, although I look upon this apprecia- 

 tion as inevitable at some future time, the weight 

 of evidence seems to me to be in favor of the 

 view that it has not yet commenced, or at least 

 has not taken place in a serious degree. It is true 

 that this statement runs counter to the impressions 

 which one derives from tables of prices, and 

 especially from the tables published from time to 

 time by the London Economist; but there is a 

 defect in these tables which has not been suffi- 

 ciently taken account of. The prices are mostly 

 those of metals, grains, and other comparatively 

 raw materials, which are made and sold on a 

 large scale. Now, the production of these staples 

 has been enormously increased in late years by 

 the opening-up of new sources of supply, and the 

 invention of improved methods of extraction and 

 production. Besides, they represent but a small 

 fraction of the total product of human labor. 

 They cannot, therefore, afford us the required 

 basis of comparison. 



What we should principally depend upon are 

 those articles in whose production no great im- 

 provement has been made. We should also take 



