CHAPTER V.

THE FUNDING SYSTEM DESTROYS A STABLE CURRENCY.

THE existence of the funding system has given as its first fruits, the entire destruction of money; and concentrates even paper money in the centres and drains it from the extremities of trade.

A STARTLING FACT-NO SPECIE IN CIRCULATION.

There cannot be a more startling fact presented to any people than this, that in the richest gold country upon earth, there is not one gold dollar in ordinary circulation, notwithstanding the Constitution of the United States has made gold and silver the only legal tender for the payment of debts. The constitutional question of banking need not be argued; it is sufficient to state the Constitution in its own language by prohibition and authority.

coin money, emit

Its prohibition, "No State shall * bills of credit, (or) make anything but gold and silver coin a tender in payment of debts."-Art. II., Sec. 10.

It authorizes the Congress of the United States "to coin money, regulate the value thereof, and of foreign coin, and fix the standards of weights and measures; to provide for the punishment of counterfeiting the securities and current coin of the United States."-Art. I., Sec. 8.

These brief, yet comprehensive paragraphs embody all that is contained in the Constitution, from which are deduced these manifest truths:

1st. To coin money does not imply the right to establish banks.

2d. Promises to pay by any person or corporation, cannot by any construction of law be metamorphosed into money. Promises to pay are not money, they are credits.

Money is the evidence of wealth, held to represent values. Credit is the evidence of poverty, held to represent indebtedness. Money has a positive value, fixed and stamped upon it by law, which, when used in commerce, commands its specific value; notes or credits are in themselves, nothing but the promises dependent upon the solvency or insolvency of others for their value. Money is the standard value of commerce, by which it is measured and controlled; credit is a beggar upon commerce for time to pay for goods taken up in advance of payment. Credit is just as much money as the shadow of a house is a house — its picture, nothing more. Money is payment beyond which no inquiry is made; credit is the promise of money, without the payment of which it is entirely worthless. By the common consent of mankind, money, which is an imperishable certificate of value, made of gold and silver, is the accredited agent and vehicle of commerce among all the civilized nations of the earth. Paper money has a limited arena of circulation, with varying value, having no value except that which may attach to the character of the payer. Paper money is a promise to pay on demand; if it is not to be paid on demand, it may never be paid; if never paid, it is worthless. Money is perpetually valuable. Money is coined. Bank notes are printed; under the Constitution of the United States, they cannot be made money. But "National Bank notes are bills of credit for which the Government of the United States has no power to make itself responsible. Bank notes are printed promises of the bill usurer and extortioner, to pay what everybody in America knows that they can't pay, won't pay, and don't intend to pay, and only promise to pay to give them character to rob, cheat and overreach the people of the country, under pretext of furnishing them with money which they do not furnish them, which they cannot furnish them, because they have no money to pay their notes, and after years of smooth swindling, will break up in a general robbery. This National Bank money gives no security for its payment, other than promises to pay. It is the reflected shadow of a shadow. But why this false pretence of money to carry on the business of a great country, whose commerce is commensurate with the hai、itable globe?

1. It is not because we have no gold or silver. No country upon the earth is so rich in the precious metals as ours.

2. Because we use a paper money which no other people will use, our gold and silver are drained from us to foreign lands, and worthless paper, monstrous frauds and visionary prices, rule the markets of the country. The result is manifest, that there is no gold left in the country.

3. The banks don't need gold or silver for their business. One promise to pay redeems another promise to pay ad infinitum ; just as the old tavern-keeper and his wife drank up a barrel of whiskey on a two-pence which passed from one to the other as they alternately played the landlord and customer, and had but the two-pence left for the liquor drank. This condition of the banks leaves them without either gold or silver in vaults; —indeed, they make no such pretension.

4. But whilst the country is drained of gold, with an incredible folly, they have placed it in the hands of unscrupulous villains, who have mortgaged the entire available property of the country to bankers, brokers, usurers, extortioners, and foreign Shylocks, to pay a debt which is drawing a double interest,— interest in gold,-to be paid to the bankers who use the bonds as a pretext for banking, and then interest on the bank notes which are borrowed out of the banks, as a currency for the people. Such is the absolute scarcity of the precious metals in the country, that no debts are paid and no business transacted with gold and silver. The poor, who would lay up money for old age, have to make heavy sacrifices to get gold, or those who buy products raised in other climes, or who would visit foreign lands, have to enter into the brokers' merciless jaws, to be devoured in exchange and usury. To add to all of the other follies in a system where not one sensible thing has been done, our gold wealth has been transferred to English bankers and Chinese miners.

EXTRAORDINARY CONDITION OF THINGS.

Not less amazing is it that where Congress has made a promise to pay a legal tender, that kind of money is becoming so scarce that complaints come up from every part of the country that

money is tight, and business is embarrassed and lags in consequence. We need not look around for the cause of this state of things. The Government has issued an immense amount of bonds, which have fastened upon us the English funding system with all its odious features, crimes and enormities, draughts upon our productive strength sufficient to absorb the annual labor of the country. In all the evil devices of faro bank and steamboat poker, nothing like the American system of revenue exists among any rational people. This condition of things challenges our examination. In the cities of New York, Boston, Philadelphia, and the East, paper money exists in the greatest abundance, and can find no permanent investment in business, but seeks it in bonds. In the Western States, money is so scarce that there is not enough for business, the payment of taxes and the improvement of the country; since the bounty-money distributed among the soldiers has been exhausted. This disparity of condition between the two sections is not accidental, but is the necessary offspring of a funding system, which gives the property of one part of the country in taxation and mortgage to the other. By this process, as fast as the people of the agricultural districts sell their products, the money is at once transferred to the tax-gatherer, in payment of taxes, and the tax-gatherer hands it over to the treasurer, who pays it out to the bondholder in liquidation of the interest on his bonds. This process is annual in his income; it is perpetual in his daily expenses, and universal upon all that he consumes. The process of exhaustion has been going imperceptibly on until the farms are stripped of their finest herds, and the agricultural regions are sinking under the pressure.

1st. The interest on the public debt amounts to several times the sum necessary to administer the Government of the United States with economy.

There is included in the debt the gold-bearing bonds, the greenback-bearing bonds, the compound interest treasury notes, and the various honest claims, which have been long due, and deferred claims, which, by collusion with the heads of departments, are allowed. To all this you must add:

2d. The assessors, collectors, clerks, overseers, detectives and

other detestable appendages of arbitrary power, which are of themselves a consuming army of cormorants, eating out our substance, and destroying our financial resources and prosperity.

As an additional reserve corps, to be supported by the people and paid for extorting from them in the exacting usury of the bank, we may add to the list of vampires who suck the blood from the poor; bank presidents, cashiers, tellers and clerks, directors, attorneys, agents and lobby members employed to corrupt the legislatures of the country, and wrest the representative power of the people from their own hands, and employ it for their own destruction at the public expense.

3d. The bonds pay no taxes, and saddle the payment upon the labor and land of the country.

After this manner is the scarcity of paper money among the people reduced :—

1. The greenbacks, which draw no interest, are converted into bonds which draw interest. The result is, that the conversion of every million of dollars makes just that much more to pay, and that much less to pay it in.

2. As the amount of greenbacks is lessened, and the amount of bonds is increased, the value of the interest and bond is each increased, and the amount of debt in that ratio becomes greater, and by exacting gold to pay the bonds, the debt would be nearly triple the amount of itself, as contracted in greenbacks. The bondholders and bankers combine to make greenbacks scarce, to make bonds valuable. Hence the scarcity of paper money amidst its plenty.