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HE editor of the REVIEW OF REVIEWS asks me to give its readers some thoughts on the issues of the present political campaign-thoughts which, coming at the end of the long debate, may serve somewhat the purpose of the judge's charge after the advocates' speeches are over, presenting the points in dispute in a judicial and non-partisan, though not in an absolutely impartial, spirit. The latter it would be an affectation for any intelligent American to assume. On what appears to me to be the most important issues in this campaign my sympathies are unfeignedly with the Republican platform; but they are those of one who believes quite as earnestly in that portion of the platform which calls for bimetallism through international action as for that portion of it which would postpone the further coinage of silver until international action can be secured.

THE FINANCIAL ISSUE.

The three great parties, the Republican, the National Democratic and the Democratic, present three distinct financial platforms, clearly discriminated. The National Democratic party advocates gold monometallism, the Republican party international bimetallism, the Democratic party the free coinage of silver at a ratio of 16 to 1, without waiting for the co-operation of other nations. In considering the issue thus presented a clear definition of terms is first necessary.

WHAT IS A GOLD STANDARD?

A standard of values in currency is very different from a standard of measurements in dry goods. It is misleading to argue analogically from one to the other-the imagined analogy does not exist. In order to secure a uniform measurement of dry goods the state determines what shall be the length of a yard. It then puts at some convenient place a stick of the required length, and all men who are selling dry goods are compelled under severe penalties to conform their yardsticks to this established standard. But every dry goods merchant makes his own yardstick and makes as many as he likes. If the standard dollar were analogous to the standard yardstick the government would make a gold dollar or a silver dollar of a certain degree of fineness, and would permit all men everywhere to coin gold and silver dollars and put them freely into circulation, only requiring that the dollars so coined should be of that degree of fineness which had been determined on by the government. This is, perhaps, a conceivable method of providing currency, but it is not the method pursued among civilized nations.

On the contrary, the government alone coins money. It is a penal offense for any one else to coin money. The standard dollar is not merely a kind of dollar to which other dollars must conform; it is the only dollar the use of which is permitted in the community. What we mean, then, by a gold standard dollar is this: A certain amount of gold of a certain degree of fineness, provided exclusively by the gov ernment, which any one who possesses any other form of recognized currency, as a check, a note or a bank bill, can, without expense, get in exchange for that currency. There must therefore be enough of the gold thus coined to furnish a basis for the paper or credit currency; that is, so much gold that it will be possible for those who are engaging in commercial transactions to get, on demand, the coin in exchange for the paper with which, for the most part, the transactions will be carried on. If the quantity of coin is inadequate for this purpose one of two things happens. Either the difficulty of getting the necessary amount of coin causes it to rise in value as compared with other world products, or, in other words, causes all other world products to fall in value as compared with coin, or else the credit system is too large for the coin basis on which it is founded, becomes, as it is said, inflated, and is subject to periodical derangement, due to a fear that the coin cannot be secured in exchange for the paper substitute.

By gold monometallism is meant a system which makes gold the only standard—that is, the only coin on which the world's currency is based, the only coin which the world is willing to accept in exchange for its paper promises. The bimetallist's objection to the gold standard is due to his conviction that the supply of gold in the world has proved totally inadequate for this purpose. The business of commercial nations has grown more rapidly than population. It has grown in expedition as well as in volume; that is to say, there are many more transactions, relatively to the population, in a year than there were formerly. And this multiplication of transactions requires a commensurate multiplication of currency. But the supply of gold has not kept pace with this increase in the commercial transactions of the world. Indeed, Mr. Giffen, who is one of the best financial authorities, affirmed a few years ago that the supply of gold from the mines was only enough to keep pace with the demand for gold for commercial purposes, jewelry and the like. If this be true, then the amount of coin available for a standard has remained unchanged, while the demand for it has greatly increased.

It is absolutely certain that the provision of gold has not increased in proportion to either population, wealth or the demands of commerce. As a conse quence of this relative diminution of the supply of gold, both the results mentioned above have ensued. Gold has appreciated, or, in other words, prices have fallen. It is true that just at this time the price of wheat is rising. It is true, as Carl Schurz has shown, that the fall in prices has not been steady and uniform. If the bimetallist supposed that changes in prices were effected only by change in the value of gold, the articles of the Evening Post and the statements of Carl Schurz would be conclusive against his belief. But he is not so ignorant of economic law as to entertain the belief which is attributed to him. What he does think is that the rise in the value of goid, because of the increased demand upon it, has been one very effective cause in producing fall in prices. His opinion is based on two very simple facts. First, that for a quarter of a century-probably a much longer period-prior to 1870 the products of the world's industries maintained a nearly uniform level, which may be roughly expressed by the figures 95-100; that in 1870 the demonetization of silver began, and that there has gone on since that time, all over the world, a general fall in prices, affecting, though not with absolute uniformity, the great food products, both vegetable and animal; the great minerals, as coal, iron, lead, copper, etc., and the great textiles, both cotton and woolen, until in 1896 we have reached the lowest price known for many years, represented by the figure 59. In other words, there has been a general though not an absolutely uniform fall in prices of over 40 per cent. in the quarter of a century since the demonetization of silver began. No other cause, -neither tariff laws, better machinery, cheaper transportation, nor overproduction, has had so world-wide an influence, affecting at once all productions and all communities, as to account for this world-wide fall in prices.

While thus gold monometallism has produced depreciation in all values by the appreciation of the standard employed to measure them, it has also produced a dangerously inflated credit system As there is not gold enough for currency, nor even gold enough to furnish a solid basis for currency, currency in various forms is issued without any adequate basis. This unnatural inflation raises prices, stimulates overconfidence, tends to overproduction, overtrading and extravagance. Then some occurrence, such as the failure of a great banking house like the Barings to get the gold on demand to meet its obligations, awakens a well grounded fear in every banker and trader lest he also may fail to get the gold on his demand for the currency he possesses, and the whole aërial structure, built on credit, with a wholly inadequate foundation, collapses. Banks refuse to discount notes, prudent men to lend their money or to give their credit, failure follows failure in a great commercial panic, with its consequent dis

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tress. These commercial crises recur under a gold monometallic system periodically, and no personal sagacity is adequate to guard against them. inflated credit system operates automatically in exactly the wrong way. When there is too much currency times appear prosperous, over confidence is a result, and overexpansion of credit incites to a further expansion. When the crash comes and panic ensues, as a necessary result the currency is contracted and the very process of contraction enhances the panic and causes still further contraction. Thus when the currency ought to contract it expands, and when it ought to expand it contracts. Such, very briefly stated, are the reasons which lead many of the wisest and most scientific financial thinkers in both hemispheres to believe that gold is a totally inadequate basis for the world's commerce. They propose, instead, gold and silver as a joint or double standard. Those who entertain this opinion are bimetallists.

WHAT IS BIMETALLISM?

Bimetallism is the concurrent use of the coins of the two metals, gold and silver, at a fixed relative value, as the standard of all other values, each metal being equally a legal tender for any amount. Under a bimetallic system the paper currency is a promise to pay either gold or silver at the option of the payer, and any debtor may pay his debt in either metal as he may choose. The argument against bimetallism is in brief that the value of gold and silver, like that of all other commodities, is fixed by demand and supply; that the debtor will always choose to pay his debts in the cheaper metal; that the cheaper metal will drive out the dearer one, and that bimetallism will always be some form of monometallism, though it may alternate in successive years or epochs, gold being at one time and silver at another the basis of currency. The answer of the bimetallist is, that the demand for gold and silver for currency is so overwhelmingly in excess of the demand for commercial purposes, that an agreement by the commercial nations of the world to use both metals equally at a fixed ratio, for purposes of currency, will itself create such a demand as will practically determine their bullion value. He admits that there will be some fluctuations, but he insists that economic philosophy and economie history combine to prove that the fluctuations will be far less than if the currency is based either on silver or on gold alone. As an illustration of this principlefor in this article there is only space for illustration, not for demonstration-is urged the fact that under the bimetallic system of the Latin Union, "throughout the period 1816-1880, gold and silver coins were accepted for all practical purposes at the ratio fixed by law; and the efficacy of the bimetallic ratio is proved by the fact that the immense increase in the supplies of gold produced no sensible disturbance in the relative value of the two metals." *

*The Royal Coinage Commission of 1886. Quoted here from a synopsis of the final report, London, 1889.