The Financial Depression.

All well-informed and observant men are aware that the great battle of life—the struggle to make both ends meet and keep that unwelcome guest Poverty at a safe and respectful distance, has been daily growing more and more cruelly severe for the last ten years.

A vast, a truly alarming proportion of those engaged in agricultural, commercial, and industrial pursuits, in almost every land, now find to their dismay, and proclaim with one voice, that, in spite of every possible care and effort on their part, they are gradually being ground down, lower and lower, from bad to worse, by the force of circumstances over which they have absolutely no control; that they can no longer, in fact, meet their engagements and liabilities, or provide by their labour as heretofore an honest living for themselves and those dependent upon them.

It is an undeniable fact, acknowledged by all, that the steady and progressive fall in general prices since 1874 is at the root of the stagnation of industry, with its deplorable consequences. The question then is how to account satisfactorily for that universal decline.

J. S. Mill tells us that "a general rise or general fall in prices is merely tantamount to an alteration in the value of money," and Professor Fawcett likewise exposes what he calls "the erroneous nature of a statement not unfrequently made that there is a general rise or fall in the value of all commodities"—proving clearly that nothing more than "an increase in the demand for gold is evidenced by a fall in the price of commodities," and demonstrating beyond dispute that "a general rise or fall in prices means that the standard of value is altered."

Economists point out that the changes in the purchasing power of money, causing high or low prices, are of two kinds. They may be either those transient fluctuations which occur periodically from the expansion and contraction of credit during the vicissitudes of speculation, or permanent ones, arising from an alteration in the exchange value of the precious metals of which money is composed, resulting from an increase or decrease in the cost of their production or some change in the proportion between supply and demand.

Let us examine these two radical causes of financial disturbance a little more closely, and endeavour to discover, if possible, from which of them the world is now suffering.

All civilised communities are so familiar with the periodical fluctuations of the market arising from over-speculation or the abuse of oredit that they require very little explanation. They commonly occur somewhat in this manner. When under the influence of panic prices have fallen—as they invariably do at such times—far below their natural level, a reaction must speedily set in, and since those who speculate when prices are at low-water mark realise large profits, many are tempted to follow their example, and each speculative purchase tends to enhance market prices till the safe and proper margin is again gradually passed, and, in the fictitious prosperity that ensues, credit is both given and accepted in the most reckless manner, since all think themselves, and appear to others, to be thriving. Fancy prices may be thus kept up upon credit for a considerable period. Human credulity, however, has its limit, like everything else, and when speculators are at last afraid to venture further, many over burdened holders of land and property of various kinds are soon obliged to realise at any sacrifice to meet their pressing liabilities, which bursts the speculative bubble, and a commercial crash speedily ensues.

Thus, where there is no deep disturbing element to counteract them, alternate waves of inflation and depression, caused by commercial gambling, generally follow one another in regular cycles every few years. Their essential and unmistakable peculiarities are that they are not universal, or at least do not affect all communities simultaneously, and the gradual improvement in prices for a considerable period is page 4 followed by a sharp, sudden, and complete collapse of comparatively short duration before prices again begin to rally.

After a severe depression values advance slowly for several years, as men speculate cautiously at first even upon a rising market, but when the disastrous ebb tide of falling prices once fairly sets in, all who are merely holding property on speculation, as so many do, at once rush into the market, being naturally eager to save themselves from the ruinous consequences of being caught under full sail by the whole force of the coming storm, which would of course involve financial shipwreck.

On the other hand, when the decline in prices is the result of a permanent change in the standard of value arising from its increased cost of production, or from the supply of that metal from any cause falling short of the ever-increasing demand, instead of the more or less local disturbance, and the gradual rise in prices followed by panic, and a sudden and severe crash, and speedy recovery to a certain extent, the whole course of change is just the opposite The depression is not necessarily preceded by excessive speculation, while the fall in prices is gradual and persistent and as universal as the standard, and goes on steadily increasing in severity from year to year till the cause is removed.

The purchasing power of money gradually declined for several centuries after the discovery of America, falling no less than three and a half-fold, in consequence of the increased supply of the precious metals lowering their exchange value, and unparalleled progress was the result. From 1810 to 1830, on the contrary, the production of the mines decreased considerably and prices steadily fell simultaneously, as was proved by Mr. Tooke and Professor Jevons, and the subsequent increase in their production up to 1848 was quite insufficient to keep pace with the ever growing demand, and the consequence was that deplorable stagnation of industry which characterised the second quarter of this century, and the world-wide suffering of that gloomy epoch so graphically recorded by Sismondi, Martineau, and others, is certainly one of the darkest pages of history.

Between 1848 and 1870, however, the rich treasures discovered in various parts of the globe nearly doubled the annual supply of gold and silver, and prices during that period rose from 18 to 20 per cent., so stimulating industry and commerce that the whole civilised world progressed by leaps and bounds—industrial marvels springing up on all sides as if beneath an enchanter's wand. But from 1873 to the present day the supply of gold has been steadily decreasing, while at the same time many civilised nations have blindly followed the example set by England since 1816, and adopted a gold standard and almost discontinued the coinage of silver.

Thus while the annual production of gold is steadily declining, the whole burden of the currency has been suddenly thrown upon that one metal, instead of being, as previously, borne by two In this manner, during the last ten or twelve years, the supply of the standard of value has been wantonly reduced by bungling statesmen from 40 to 18 millions sterling, a fact which, in spite of Mr. Mulhall's extraordinary assertion to the contrary, all intelligent men must at once perceive is alone quite sufficient to account for the steady and persistent rise in the value of gold, or, as we commonly say, fall in general prices now going on.

When it was first proposed to institute a general crusade against silver, the disastrous effect that such a wholesale change would have upon industry was pointed out by the Economist. Laveleye, Seyd, Bagehot, and other authorities too numerous to mention. Disraeli said. "I attribute the monetary disturbance that has occurred, and is now to a certain degree acting very injuriously to trade, to the great changes which the Governments of Europe are making in reference to their standard of value. . . . It is quite evident that we must prepare for great convulsions in the money market not occasioned by speculation or any old cause, but by a new cause with which we are not sufficiently acquainted." And that able statesman, Mr. Goschen, said in 1878, the "demonetisation of silver would produce a more disastrous crisis than any of those recorded in history."

Both high financial authorities and practical business men are now rapidly realising j the palpable fact that the present depression is mainly the result of the appreciation of j gold; and a very powerful and influential organisation has suddenly and simultaneously (sprung into vigorous life in Great Britain, Germany, and the United States, advocating; bimetallism or demanding some other immediate remedy for that deplorable modern! blunder, the demonetisation of silver, which has so speedily entailed incalculable misery upon every nation that has been a party to it.

Eminent British statesmen are already calling upon the electors to investigate this momentous problem. Lord Churchill, late Secretary of State for India, and now Chancellor of the Exchequer, said in one of his recent public addresses, "It will be for you in Lancashire to turn your attention to the dark and apparently unfathomable question of the relative value of silver and gold, and endeavour to ascertain, by your ingenuity page 5 and by your experience, whether some policy in the nature of fixing permanently the relative value of these two metals may not possibly bring, not only security to Indian finances, but prove a real remedy for the decay in trade and be the means of reviving British commerce and enterprise."

At the annual meeting of the Institute of Bankers held in London on the 19th of May last, as reported in the London Times, no less an authority than Mr. Giffen, alluding in a paper, which he read upon "Bimetallism," to the evils that have already resulted from the late proscription of silver, said, "The primary offender in the matter was perhaps Germany, which made a mistake, I believe, in substituting gold for silver as the standard money of the country. . . . More recently a great deal of evil has been caused by the unfortunate legislation of the United States. No doubt the pressure upon gold would have been more severe than it has been, if the United States had not passed the 4 'Bland Coinage Law' (an Act providing that £5,000,000 worth of silver dollars may still be coined annually). To some extent Italy has also been an offender in this matter; the resumption of specie payments in that country upon a gold basis being entirely a work of superfluity, the resumption on a silver basis would have been preferable."

Another member of the Institute remarked, that" what bimetallists wanted was to preserve the world from the dire calamity that would happen if the silver question were not dealt with." A third said, that "if nothing were done with the silver question, prices would fall to one-half what they were now. He believed that if silver were monetised over a wide area of the world to the old ratio there would be, not a fall, but a rise in prices all over Europe of 10 to 20 per cent."

Mr. Shaw Lefevre, M.P., asked, "Was the fall that had been caused by the appreciation of gold any disadvantage to the country? Debtors were adversely affected, but creditors were benefited, and it was to be remembered that England was the creditor of the world." A cruel joke, indeed, at our expense.

Another said, "That according to the report of the United States Mint of 1884, there was not enough gold in existence to pay the national debts of the world. He held that it was necessary to supplement one metal with the other;" while Professor Marshal (Cambridge) contended "that prices were likely to go down. He thought that we ought to see whether, with no great change, we could not bring about something that would in the long run be more productive of good than anything the bi-metallists proposed." The only rational plan to adopt, since a radical remedy for constant fluctuations in the standard of value during this age of rapid progress and advancement, and not a mere temporary make-shift, should certainly be the aim of statesmen.

Of the total yearly production of gold, now about £18,000,000 sterling, Soetbeer estimates that £12,000,000 are annually consumed in the arts and manufactures; £4,000,000 are absorbed in the East; leaving only £2,000,000 to supply the whole civilised world with a medium of exchange. That small supply, moreover, is steadily decreasing, while the demand for gold for various purposes is rapidly increasing in every quarter of the globe.

The famous economist, M. Laveleye, who has long been calling public attention to this momentous social problem, writing in the Contemporary Review of May last, said, "It can no longer be concealed that the gold budget presents a really alarming aspect. ... If losses and wear and tear are taken into consideration, there remains only £1,000,000 to cover the monetary requirements of the entire world with all its growing population and trade. Should not this single fact suffice to open the eyes of statesmen, if they could for a single instant turn their eyes in this direction? The quantity of gold available for currency being insufficient now silver is proscribed, it is quite certain that we are approaching a universal régime of paper money."

If any further proof of the contraction of the currency is required, we have it in the fact that the coinage of all European nations, with the solitary exception of Russia, has of late years come almost to a standstill. The amount annually issued by the English Mint during the last six years has averaged only £1,318,805, or less than one-third as much as for some years previously, a large proportion of which is only the recoinage of old sovereigns, and the authority just quoted concludes, from careful calculation, that her stock of coin, estimated by the Director of her Mint at £120,000,000 sterling, has decreased nearly one-fourth since 1878.

Even the great gold producing countries now have little to spare. Australia, which from 1871 to 1875 exported that metal to England to the annual value of £7,000,000 sterling, has gradually reduced the amount year by year till in 1884 it was only £709,388, being actually £210,612 short of what was imported from London during that season.

In the United States likewise, between 1879 and 1884, the whole production of the gold mines fell short of the quantity of that metal actually coined at their own mint, page 6 by no less than 150 million dollars. Yet, in the face of such startling facts and figures, the more the depression increases in severity from the fall in prices, or more correctly speaking, rise in the value of an artificially contracted standard, and the consequent crushing competition of silver-using nations, just so much more tenaciously, with truly incomprehensible blindness and superstition, do monometallists cling to their golden idol. Atkinson, the American champion of that infatuated school, after pointing out in his recent work on "The Distribution of Products," that a long continued stagnation of industry cannot possibly result from over-production, says: "What other cause can be assigned for the continued depression except the uncertainly as to the standard of value which is caused by the coinage of low priced silver dollars? . . If all doubt as to the stability of the currency could be again removed by the cessation of the coinage of silver, a period of activity and prosperity might quickly come." Whereas, as we have just been told by Mr Giffen, the greatest living authority upon such questions, the law providing for the annual coinage of a small quantity of silver dollars in the United States is really the only safety-valve that prevents the disastrous pressure upon our gold standard from being more severe than it is at present.

India, Russia, Austria, and China are comparatively unaffected by the growing scarcity of gold since they yet adhere almost exclusively to silver as their medium of exchange, and that metal still maintains its relative price to the products of industry, although, like all other commodities, it is seriously depreciated as compared with its costly rival, which has risen so enormously in value since 1873. The consequence is, as might naturally have been expected, that those nations, though their foreign liabilities are unjustly increased, are not suffering, like gold-using countries, from the prevailing depression.

It is a very common error to suppose that the fall in the price of silver of late years has arisen from its excessive production as compared with gold. Mr. Mulhall's calculations however clearly demonstrate that that ground is quite untenable, since, according to his estimate, the quantity of silver possessed by mankind is now only nineteen times as much as the amount of gold, while in 1850 the proportion was no less than thirty-two to one.

Professor Fawcett, writing in 1883, maintains that up to that time there had certainly been no fall in the purchasing power of silver in India, and in support of his contention he argues that, "if such a decline had occurred, general prices in that country must have advanced, whereas there seems to be no doubt that during the last few years, when silver has been falling in price, general prices have not advanced in India." He explained that the only way in which India suffered from the appreciation of gold, was because the interest upon her national debt, and all her other foreign liabilities were necessarily estimated in that metal, an unjust addition to her burdens, now amounting to the enormous sum of £4,000,000 per annum.

Sir George Grey said truly, in one of his late public addresses in Auckland, that the industrial depression was largely caused by the increased severity of competition from India; but ho did not explain why that competition had become so formidable during the last ten years. Let us pursue the inquiry a little, and endeavour to ascertain why it is that the enterprising and industrious Anglo-Saxon is now unable to hold his own as proudly as formerly against inferior and semi-barbarous races. Have our industrial classes the bone and sinew of the nation-degenerated? Or have they rather been unjustly handicapped in the great battle of life by blind statesmen and bungling legislation?

Let us first put the farmer in the witness-box, since his occupation is the sheet anchor and mainstay of every country. Ask him why he has to throw up the sponge and confess himself beaten at his own trade by the semi-barbarous hordes of India and Russia, and other silver-using countries that now easily undersell him in all the great markets of the world.

His plain matter-of-fact statement is simply this:—That while for a given quantity of produce, costing say £900, he formerly received £1,000 in the London market, leaving him £100 for his labour, now, since prices have fallen 10 per cent., he receives for a similiar shipment a draft on his banker for only £900, leaving him absolutely no margin of profit whatsoever.

On the other hand the same quantity of wheat or other produce shipped from India to London also sold till within the last ten years for £1,000, which was returned to the Indian producer in the form of a draft on his banker for 10,000 silver rupees, the currency of his country, leaving him likewise a profit of one tenth, or 1,000 rupees. The £900, however, which the same quantity of produce at present realises in London is now remitted to India in the shape of a bank draft for 12,000 rupees, since the exchange value of the rupee, as estimated in England's gold coin, has fallen twenty-five per cent., or from 2s. to Is 6d. But since the purchasing power of silver has not declined in India, as pointed out by Professor Fawcett, and clearly proved by the page 7 commission that lately sat to investigate that question, the cost of production is manifestly still the same there as formerly. The Indian producer, therefore, has just three times his former profit, or 3,000 rupees for his trouble instead of 1,000.

Thus while the profits of all nations using a gold standard and currency have, upon such exports, been already swept away by the appreciation of that metal, which is still rapidly rising in value, the profits on the exported productions of those that still possess a silver standard, have been actually trebled at their expense. For although we have selected India as an example, the same of course holds equally true of frozen meat, hides, wool, tallow, and every export of Russia and all other countries that still adhere to silver.

The farmer is not alone in his trouble, for all branches of industry now suffer alike, and the looms of Manchester pay just as heavy a tribute to rival competitors through the incapacity of our tardy and bungling statesmen as the virgin pastures, wheat fields, and forests of Australia.

While our public men are looking listlessly on, or calling in vain upon Jupiter for help, instead of putting their shoulders promptly to the wheel to protect the interests of a proud and high-spirited nation, the very life-blood of the Anglo-Saxon race is being crushed out of them for the benefit of our great European rival, and the teeming hordes of India, China, and other semi-barbarous countries.

It is hardly necessary to call attention to the obvious fact that the late rise in the value of gold of 25 per cent., as compared with silver, is precisely equivalent to a protective duty of that amount to exclude the produce and manufactures of those nations that have a gold standard from all states that employ silver for that purpose. Hence the large export of silver to those countries in exchange for their products.

To any one who is cognizant of the great financial changes now in progress it is really painful in the extreme to witness our industrious settlers struggling manfully with strong arms and brave and willing hearts to bear up against such terrible odds, and striving in vain to keep their heads above water under the crushing burden of that unjust competition of which their blind rulers seem to be about as unconscious as the man in the moon.

From 1850 to 1870, while gold was depreciated in value from the excessive supply, England, being the only nation possessing a gold standard, throve immensely—in fact, far better than any country in the world, and many very naturally attributed her unexampled prosperity to her free trade policy; but the moment gold began rising in value that beautiful fallacy was scattered to the winds for ever, by the fact that industrial stagnation speedily overtook her in spite of her magnanimous tariff. On the other hand, the present deplorable condition of France, Germany, and other protective countries likewise clearly shows that the most rigid protection, which is the curse of our race, by stirring up national jealousies and animosities, is equally powerless to baffle for a moment against a fluctuating standard.

In all countries where the coinage is based upon gold the enterprising business man now finds his once profitable game most uncertain and precarious, for in what can he safely invest or speculate when all values are daily depreciating?

The merchant not only has to bear the full loss arising from the fall in the value of his own property, but may be utterly ruined from the inability of those whom he habitually crusts to meet their liabilities in such trying times. The farmer finds the value of his land, his stock-in-trade, and all he produces falling perpetually lower and lower, while at the same time his financial burdens are proportionately increased, since, in consequence of the fall in prices, it will take just so much more stock or produce to meet a given sum for wages, interest, rent, or taxes.

Joint stock companies, in which such a large proportion of every community are interested, are, with the exception of banks, loan offices, and a few close monopolies, among the first and severest sufferers from a rise in the standard of value, since they usually have their capital fully invested, and heavy liabilities, and cannot curtail expenses and contract operations as speedily as private individual

The wage-earning class are generally the last to realise the full effects of a fall in prices from the appreciation of the standard, since custom keeps the rate of wages up for a time, and employers keep their works going for a year or two, even at a loss, in hopes of prices rallying; but as such unprofitable business steadily contracts, the ranks of the unemployed are gradually swollen to alarming proportions, and having nothing to fall back upon, the masses are reduced to the verge of starvation. Thus workmen are invariably the severest sufferers in the end. Employers are now probably feeling the pinch most severely, but their servants must necessarily soon share their calamity.

The question, then, that naturally suggests itself is this—How can prudent men best hold their own until the electors are sufficiently aroused to compel statesmen to provide a remedy for the iniquitously unjust standard and currency now in use?

The President of the Bank of New Zealand said truly at a late meeting of the page 8 shareholders, that under such circumstances as the present "there is no room for speculative business, and as a rule he is doing best who is doing least." Beware of speculating in land, ships, buildings, or anything in fact but gold, and invest every pound which you can spare in such a manner that it will be safely restored to you at some future day in that metal. If you lend money out upon good security the return in interest may seem small, but your capital will steadily crow in value day by day in the same proportion as the purchasing power of money is increased by the fall in prices.

Sir Julius Vogel said, in his late public address in Wellington, that statistics showed that the market prices of both imports and exports had fallen more than 14 per cent, during the last five years. Assuming his figures to be correct, if anyone had lent, say, £1,000 five years ago, that money, if now called in, would be worth—in addition to the interest received—14 per cent, more real wealth, the fruits of industry, than it was when lent, or an increase of £140 worth—a difference arising solely from the unearned increase in the value of gold. Those, however, who have had their capital invested in joint stock companies engaged in agricultural or industrial pursuits know from bitter experience that the difference since 1880 has been in most cases far greater than that-a fact proved to demonstration by the market quotations of any stock exchange in the colony. Can we reasonably wonder, then, that industry stagnates when so heavily handicapped?

Capital is proverbially sensitive to its own interests, and although moneyed men as a rule probably know very little about the appreciation of gold, they are undoubtedly learning wisdom very quickly by practical experience, for while they will now leave their money lying idle rather than invest it in the most tempting ventures, they will lend it out at very low rates of interest and eagerly tender for Government loans at a nominal figure.

The authority just quoted said, in his late financial statement, that "within the last two years only there has been a fall all round in the rate of interest of about 2 per cent., and that fall is continuing," which clearly points in that direction.

Some may imagine that a low rate of interest would show that there is no increase in the exchange value of gold, but the truth is that it is the very strongest possible proof of the contrary, for when industry becomes unprofitable from the persistent fall in prices, or rise in the purchasing power of money, there is but little demand for it on loan, since the unearned increase in the value of gold is a crushing tax upon borrowers.

M. Laveleye, writing in May last, says: "It is a very singular but a perfectly evident fact that if half the coin in circulation were suddenly suppressed, the other half, instead of being insufficient, would be superabundant. If an article formerly! worth £1 can be purchased for 10s., exchanges can be effected with as much facility as before, only on a basis of prices reduced one-half. In addition to this there would be a terrible disturbance throughout the economic world, all business would be suspended, and a quantity of money would lie idle. This is precisely the present situation."

Mill and other economists clearly point out the gross and cruel injustice that it done to the taxpayer and all private debtors by the appreciation of the standard If prices fall 50 per cent, all national and other debts are thereby doubled. To meet a given sum of interest upon a foreign loan a colony would have to export twice as much produce as before, and the man who had borrowed money to purchase a homestead or invest in farming or other enterprises would have to dispose of twice as much of the fruits of industry as that gold was worth when he borrowed it, to repay the amount, which would of course mean utter ruin to the great majority of debtors from no fault of their own.

When men once realise the indisputable fact that gold is now steadily growing in value, they must instantly perceive that under such circumstances a borrowing policy, for either State or individual, is perilous in the extreme, and must, if persisted in, end eventually in either bankruptcy or repudiation. To borrow gold while it is daily becoming more and more scarce, to speculate upon a falling market, is nothing more or less than recklessly and wilfully committing financial suicide. England has been making great efforts to reduce her national debt ever since the battle of Waterloo, and has paid off about £100,000,000 sterling, but it is an indisputable fact that the late change in the standard of value has increased that burden more, as estimated in the fruits of industry during the last seven years, than the weary, struggling taxpayer had reduced it in seventy, without giving him one fraction in return for that munificent gift to bond-holders.

A fact which calls forcibly to mind an incident related by Sir Edward Parry, who tells us that upon one occasion, during his Arctic explorations, when his party were making, as they thought, great progress in sledges over the icebergs towards the goal of their ambition, scientific observations revealed the startling fact that the whole ice page 9 field upon which they were toiling in vain so laboriously was steadily drifting with them far faster in the opposite direction.

Unlike the proverbial ill wind, there is no single redeeming feature in a depression arising from a contraction of the currency. As Laveleye says," All incomes diminish, whether they are derived from land, from industry, or from commerce. The entire social body is in a state of decline." The only persons who really gain are bondholders, and those who have fixed and stated incomes, since they, of course, daily grow richer and richer while prices are falling from the very cause that is reducing the rest of the community to poverty, augmenting the burden of taxation, and so terribly increasing the bitter struggle of life. So far, however, as official salaries are concerned, that advantage can only last just so long as the electors fail to grasp the problem which we are considering. The Premier tried to introduce a clause into the Civil Service Reform Bill this session to provide for the readjustment of all official salaries periodically in proportion to the decrease in the cost of the necessaries of life, which shows how short-lived the present advantage derived by civil servants from the late fall in prices is likely to be—a temporary gain, probably in most cases far more than outweighed by the fall in the value of property in which they are directly or indirectly interested.

As the Edinburgh Review justly said, in an able article on The Scarcity of Gold," in January last: Our only consolation is that, "fortunately, the source of our present difficulties is no longer the mystery that it was even to our statesmen in former times. The tact that nowadays it can be traced to its fundamental cause constitutes the best hope amidst our present difficulties.

Adam Smith foresaw the possibility of a precious metals, and pointed out the only rational remedy in the first chapter of the fourth book of "Wealth of Nations," saying: "If gold and silver should ever fall short in a country that has wherewithal to purchase them, there are more expedients for supplying their place than that of almost any other commodity. If the materials of manufacture are wanted, industry must stop. If provisions are wanted, the people must starve; but if money is wanted barter will supply its place, though with a good deal of inconveniency. Buying and selling upon credit, and the different dealers compensating their credits with one another once a month, or once a year, will supply it with less inconveniency. A well regulated paper money will supply it not only without any inconveniency, but in some cases with some advantages" over the precious metals themselves.

What he meant by a well regulated paper money he explains in the second chapter of the second book of his great work, where he says: "A prince who should enact that a certain proportion of h s taxes should be paid in a paper money of a certain kind, might thereby give a certain value to this paper money, even though the term of its final discharge and redemption should depend altogether upon the will of the prince. If the bank which issued this paper was careful to keep the quantity of it always somewhat below what could easily be employed in this manner, the demand for it might be such as to make it even bear a premium, or sell for somewhat more in the market than the quantity of gold and silver currency for which it was issued."

J. S. Mill was a most bitter opponent of paper money, since he wrote just at the time when the precious metals were so plentiful that there seemed no chance of a growing scarcity of gold, but quite the reverse, yet he frankly acknowledged that "if the issue of inconvertible paper were subjected to strict rules, one rule being that whenever bullion rose above the mint price the issues should be contracted until the market price of bullion and the mint price were again in accordance, such a currency would not be subject to any of the evils usually deemed inherent in an inconvertible paper."

How the exact balance between the price of paper and bullion could be easily maintained has been pointed out very clearly by the great economist, Ricardo, so justly famous for solving abstruse social questions.

In his "Proposals for an Economic and Secure Currency," he says: "To secure the public against any other variations in the value of the currency than those to which the standard itself is subject, and at the same time carry on the circulation with a medium the least expensive, is to attain the most perfect state to which a currency can be brought, and we should possess all these advantages by subjecting the bank to the delivery of uncoined gold or silver at the mint standard and price in exchange for its notes, instead of the delivery of guineas; by which means paper would never fall below the value of bullion without being followed by the reduction of its quantity. To prevent the rise of paper above the value of bullion, the bank should be obliged to give its paper in exchange for standard gold at the price of £3 17s per ounce."

No writer up to the present day has exposed in detail all the fallacies of the multitudinous schemes propounded for creating wealth by the issue of paper money, with as page 10 much vehemence and ability as D. H. Macleod, Fellow of the Cambridge Philosophical Society, in his well known modern work, entitled "The Principles of Economical Philosophy and this is his definition of what a perfectly safe and absolutely reliable paper money should be: "If, for the public convenience, it is deemed advisable to issue an inconvertible paper currency, the only way of maintaining its currency at par is by limiting its quantity. We do not mean by this limiting its quantity to an absolute fixed amount, but by devising some means whereby a greater quantity of it shall not be issued than if it were convertible into gold. If more than this is issued it will be followed by the same result as attends an excessive issue of silver, it will fall to a discount, which in this case is depreciation; and the necessary consequence of a depreciated currency will follow, viz., the market price (or paper price) of bullion will rise above the mint price, and the foreign exchanges will fall.

"Now if such a state of things happens, the proper remedy is to diminish the quantity of the paper in circulation until the market price of bullion is reduced to the level of the mint price. If the direct power of demanding five sovereigns be taken away from the holder of a £5 note, still if he can purchase bullion with it in the market to the amount of five sovereigns, it is an infallible proof that the note is current at par, and the limitation need not proceed beyond that. . . .

"It becomes in all respects a new standard just as much as gold or silver, and its value will be affected by the same principles as these two, viz., by the sole question of the quantity of it in circulation compared to the operations it represents.

"If the direct power of demanding coin be taken away by the State, the power of commanding a certain amount of bullion in the market still equally remains as the only test of its value."

This conversion of paper money at pleasure into uncoined gold or silver, is, of course, just what Ricardo's famous suggestion provides for. Such an arrangement is probably the very best that could be made, for it would relieve the State from the necessity of keeping any coin, and replace all the metallic currency but small change by State notes, and thus effect an enormous saving and greatly relieve the strain upon gold, and, at the same time, prevent the possibility of State paper depreciating, for if it fell in the slightest degree it would be immediately exchanged for the precious metals for export.

Some may imagine that the State would have to keep a large quantity of uncoined treasure on hand to meet the ordinary demand for money for foreign trade, but that is a great mistake.

J. S. Mill says: "All interchange is, in substance and effect, barter, . . . and so of nations—their trade is a mere exchange of exports for imports; and whether money is employed or not, things are only in their permanent state when the exports and imports exactly pay for each other. When this is the case, equal sums of money are due from each country to the other, the debts are settled by bills, and there is no balance to be paid in the precious metals."

And Professor Fawcett points out that even the interest upon foreign loans is paid, not in gold and silver, but by an excess of exports of the fruits of industry over those imported by means of bills of exchange.

Since we have no State bank to serve as a clearinghouse, some of our banks are now constantly exporting coin while others are importing it, which entails a great and quite unnecessary risk and loss, for which their customers, of course, have to pay. How little coin, however, is really required for export, is proved by the fact that our exports and imports of money very nearly balance each other. Thus, in 1881 the difference against the Colony was £13,000; in 1882, £3,320 only, and since then our imports have considerable exceeded our exports, in consequence, probably, of the depression having alarmed our banks.

During great and protracted wars nations are obliged to issue large quantities of absolutely inconvertible paper, which is, of course, simply raiding enforced loans from their subjects, and it has been justly suggested by modern economists, that upon such occasions, when the public safety demands the issue of paper for which bullion is not forthcoming on demand, State notes should be convertible at pleasure into Government bonds bearing a fair rate of interest.

With such a provision for the security of holders of State paper, it could never have fluctuated in price as it did to the great disturbance of business during the long struggle with Napoleon, when for twenty-two years Bank of England notes were absolutely inconvertible, or as the notorious American green-backs more recently did.

Anyone who is cognizant of the world-wide distress already prevailing, and so rapidly increasing, must, we think, come to the conclusion that since its fundamental cause is now clearly recognised, the little narrow prejudices of bankers, bondholders, and bullionists will be soon disregarded, for men as a rule speedily open their eyes in cases where their daily bread, the interest of themselves and their families, is so nearly page 11 concerned. The probability, however, is very great that tardy, procrastinating statesmen will at first try and simply tide over the difficulty for a time by adopting the suggestion of bi-metallists, and reinstating silver in its former position. That would, of course, afford considerable relief, and greatly check the present progressive fall in prices, but the fact that after the late gold discoveries the trade of the whole world, as pointed out by Mr. Mulhall, expanded four and a quarter-fold in thirty-four years, while the annual production of the precious metals is now practically at a standstill, should surely satisfy any intelligent man that the recoinage of silver would at best only mitigate the depression, and postpone the evil day for a very limited period. The real remedy undoubtedly lies in providing that the universal standard of value shall be economised as far as possible by the general use of paper money for home requirements, reserving the precious metals to be used as international money in the form of uncoined treasure.

It is absolutely essential that something should be done as speedily as possible to put a stop to the wholesale spoliation of debtors which is now going on through the appreciation of gold, to the utter ruin of the most enterprising and energetic men in every community where that metal is employed as the standard of value.

Justice revolts at the very idea of systematically robbing either debtors or creditors through the means of a standard which is rapidly changing in value in either direction. It is nothing more or less than the public use of false weights and measures to plunder one class to enrich another. How debtors now stand such treatment so patiently to the utter sacrifice of the interests of themselves and their families passes all comprehension. Their apathy probably only shows that they have hitherto failed to grasp this problem rather than any wilful and unmanly neglect of the first law of nature—self-defence.

J. S. Mill says "there cannot be intrinsically a more insignificant thing in the economy of society than money, except in the character of a contrivance for saving time and labour." Experience, however, proves that the adequate or inadequale supply of that "contrivance for saving time and labour" just makes all the difference between the bright golden age through which we have so recently passed and the death-like stagnation which is now draping the whole civilised world in mourning from one end of the globe to the other.

The same great authority tells us that "credit coined into notes as bullion is [unclear: coined] into pieces of money to make it portable and devisable, is so much purchasing power superadded in the hands of every successive holder to that which he may derive from his own credit. . . . Every bank note issued renders the credit of the bander a purchasing power in the hands of the successive holders."

If men could only realise this great fact, and perceive that the note which the State pays a workman to-day may pass through many different hands in the [unclear: cou] of a year, providing the means of finding as much useful employment for as many different individuals, they would easily comprehend how greatly trade, industry and commerce may be stimulated by making use of public credit in the form of national paper money.

The discovery of a great gold field, for which men now long so anxiously to remove the depression, could do no more than provide material for augmenting the quantiy of that machinery by means of which barter is facilitated, and since the value of all money is purely artificial, that machinery could be provided just as well by a paper currency cased upon uncoined treasure as suggested by Ricardo and other econonists.

Let us row glance at the popular arguments most commonly urged against a State paper currency.

1. We are sometimes gravely told that Government notes would infallibly come to grief at the first bank they entered—that they could not possibly float.

That objection takes it for granted that all private banks could exchange State [unclear: botes] for sovereigns, and deluge the market with their own doubtful paper instead. But how could that possibly occur if State notes were the only legal" tender? Have private bankers been able to suppress national paper money in India, Canada, the United States, or any other nation upon earth? The idea is palpably absurd.

2. Again, it is said people would mist-rust State paper money.

That objection implies that men are such fools that they would rather rely upon the credit of a few private speculators, whose sole object is to fieece them, than [unclear: unpomhat] of a whole nation legislating for the public good. To say that existing bank note are always convertible into sovereigns is nonsense, for what would become of their small reserve of gold if a panic set in ? It is only a delusion and a snare That the [unclear: cred] of any British colony is far better than that of any ring of private individuals is [unclear: provied] to demonstration by the incontestible fact that it can borrow vast sums of money at much lower rates of interest, giving no security whatsoever but the promise of the people's representatives.

page 12

3. Others maintain that since our note circulation is now less than one million, the annual saving at present from a State issue could not possibly exceed £40,000.

This very common assertion is based upon the supposition that State notes would only displace that paper money now in circulation, whereas they could largely supersede our metallic currency as well which is about twice as much. Our note circulation in March last was actually £42,528 less than in the corresponding month seven years ago, although our population had enormously increased during that period. Hence we may fairly conclude that our paper currency could be very considerably augmented by the judicious management of our finances, and expenditure of public money, with immense advantage to the whole community. We maintain that the present depression is largely attributable to the contraction of the currency. Those who absurdly imagine that all that is required is to secure for the public treasury the comparatively trifling profit which private banks now make upon their note circulation propose to secure that by increasing the tax upon their paper issues. So far however from such a cheeseparing policy mending matters, the certain result of depriving the existing banks of the profit now made upon their notes, without issuing State paper to take their place, would be to augment the depression by contracting the currency still further, since bankers, in self defence, would naturally decrease their note circulation in the same proportion as it was rendered unprofitable by increased taxation.

4. Interested alarmists pretend that if private issues were driven out of circulation by State paper the existing banks could come down upon the colony for heavy compensation.

If, through bungling legislation, they have secured any such monstrous and unjust monopoly let their claim by all means be settled immediately before any further liability is incurred. The Hon. J. Bathgate, however, said in the Legislative Council only a few weeks since, "The banks here have no especial charter or vested or exclusive right granted to them of issue. In every one of their acts there is a special saving clause reserving the rights of the crown and of every corporation. They have no exclusive privilege conferred upon them." That the existing note circulation here is entirely under the control of the State, is proved by the fact that the banks now pay a tax upon their paper issue of two per cent., which the Parliament has the power to increase at pleasure.

We do not, however, propose to interfere with legitimate banking in any way. The banks would be the greatest gainers through the influence of State paper in arresting the depression and promoting prosperity. In the words of the authority just quoted from Hansard, "If we wish our monetary institutions to survive the period of hurricane rapidly approaching, we must fill their coffers with notes of legal tender that will have a right to circulate throughout the colony without question."

One of the greatest perils at present under the existing system is, that our banks must collapse one after another, causing widespread misery and ruin, just so fast as their securities become rotten with the progress of the depression and the consequent depreciation in the value of land.

The Right Hon. W. E. Gladstone has told us that "private issues should disappear like private mints, and each kingdom have one uniform paper circulation, issued from a single central State department more resembling a mint than a bank," contending that "the profit of issues belongs to the State, and what is much more important than the profit, the responsibility of issues also belongs to the State." Again, in his famous oration on Home Rule in April last, he said: "Ireland might think fit to pass a law providing for the extinction of private issues of notes in Ireland, and providing that no bank notes be issued in Ireland excepting under the authority and for the advantage of the State. I own that it is my opinion that Ireland would do an extremely sensible thing if it should pass such a measure. It is my strongest and most decided opinion that we ought to have such a measure, but the block of business has prevented that and many other good things towards which we are now going to open and clear the way."

It is easy to paint glowing pictures of the folly of issuing paper, or metallic money either, in excess of legitimate requirements, for every schoolboy knows that it is not only utterly useless but absolutely dishonest to depreciate the currency, but it has yet to be shown—in spite of all the ridicule that has been ignorantly or selfishly heaped upon it—that national paper money based upon sound economic principles, would not, preserve the equilibrium of the standard an prove an incalculable blessing to mankind.

None can possibly dispute the economy of substituting paper for a metallic currency. Adam Smith compared such a change to replacing old-fashioned and costly machinery with the latest modern inventions and then adding the difference saved thereby to a nation's productive capital.

McCulloch estimated and pointed out how many millions sterling were annually lost by civilised nations in the shape of interest, and wear and tear, upon their costly medium of exchange. And J. S. Mill said, "the substitution of paper for a metallic page 13 currency is a national gain. . . . And so long as the notes are no addition to the currency, but merely supersede gold or silver to the same amount, the gain to the issuer is a loss to no one, It is obtained by saving to the community the expense of the more costly material."

Professor Fawcett endorses the same view, saying, "The economy of this substitution is obvious; gold is a valuable commodity requiring much labour and capital to obtain it."

To quote one colonial authority, W. E. Hearn, LL.D., Professor of Political Economy in the University of Melbourne, says in his able work "Plutology":" The precious metals, as their name denotes, require much time and trouble for their attainment. It is not every nation that can afford to use such expensive machinery. There is no community so opulent as not to derive a perceptible relief from the substitution of an equally efficient but less costly medium," as he justly styles paper money.

While gold was rapidly depreciating in value between 1850 and 1870 we had several sharp commercial panics resulting from the sudden contraction of credit after periods of excessive speculation, as for instance in 1857 and 1866, and in precisely the same way we may reasonably expect periods of transient revival from the speculative expansion of credit, even while the standard of value is changing in the opposite direction In fact we may look with confidence for a rise in the market in the case of such commodities as, from exceptional causes, are depressed in price far beyond what can be accounted for by the reduced cost of production in silver-using countries, or the change in the value of gold.

Some over sanguine people now apparently imagine that the world wide depression is just at an end because the wool market has somewhat recovered, and the effect of the late improvement in the value of that staple commodity must be immense in wool-growing localities, but that the price of that article had been unduly depressed was obvious, since its value had fallen out of all proportion to that of other products of industry. This was clearly pointed out by Sir Julius Vogel in his financial statement just before the late partial recovery occurred. He said: "Lest it may be supposed that what I have said about the present depression means that I think its principal cause—the reduced value of wool—is likely to continue, I must say that such is not my opinion. It seems to me that a sharp rally in prices must occur. I am one of those, who believe that all commodities have fallen in nominal value because of the appreciation of gold, but the fall in wool has been disproportionately great."

Some argue, like Mulhall and Atkinson, that gold cannot be growing scarce, because, since 1850, the quantity of that metal in circulation has doubled, while population has only increased 40 per cent.; but such writers overlook the fact that the demand for gold has enormously increased of late years for various purposes, and they conveniently forget the late wholesale demonetisation of silver. Again, while endeavouring to account for the fall in prices by attributing it to improvements in machinery and the means of transit, they fail to explain how it was that prices went on steadily rising, in spite of all such changes and improvements, until the close of the Franco-Prussian war, when the general crusade against silver and the rage for a gold standard and currency set in. The absurdity of such a palpably shallow theory as that, is proved to demonstration by the fact, that the market prices of all commodities have fallen quite irrespective of whether there has been any such saving in the cost of production or not.

A doctrine very common in the commercial world is that credit instruments of various kinds are increasing with sufficient rapidity to facilitate exchanges as gold becomes more and more scarce. But Mr. Giffen himself says: "I much doubt whether any serious economy has been effected with regard to the exchanges accomplished by the substitution of credit for gold." Recent reports tell us that the clearings in London have been gradually decreasing of late years, which plainly shows, as might naturally have been anticipated, that, under existing arrangements, the volume of credit instruments contracts rather than expands as industrial stagnation increases from the growing scarcity of gold.

Many imagine that the production of wealth could not be either stimulated or retarded by any alteration in the standard of value since the purchasing power of money rises or falls in exact proportion; but, as J. S. Mill says, "there is a disturbance, in short, of fixed money contracts, and this is an evil whether it takes place in the debtor's favour or the creditor's," and he fully explains that the effect of the appreciation of gold is to despoil the active members of every community for the benefit of the do-nothings.

Some, again, contend that a growing scarcity of gold would only sacrifice present debtors to enrich their creditors, which would certainly be bad enough, since most energetic men who are engaged in active enterprises have serious liabilities. Unfortunately, however, the trouble will not end there, for while gold is steadily rising in page 14 value all financial contracts entered into in the future, until some remedy is devised, must become just as viciously unjust five years after as those now are which were made as many years ago.

Writing upon this subject, the Edinburgh Review lately said: "The doctrine that changes in the amount of the circulating medium are really of no consequence, in-asmuch as such an increase or decrease is pari passu attended by a proportionate change in the value of money, so that the effective power of the currency remains unaltered, is now all but extinct, and can survive only in minds which are impervious to the remarkable lessons of the last 30 years." Those lessons that teach us that the mighty march of human progress which accompanied the development of modern gold fields between 1850 and 1874, when the medium of exchange was abundant, was abruptly brought to a disastrous standstill and steadily succeeded by an industrial famine, so soon as prices began falling from a decline in the production of gold, accompanied by an artificial contraction of the standard of value through the general banishment of silver from the mints of the world.

The poor, as they deplore the scarcity of employment, often attribute their hard fate to labour saving machinery, forgetting that experience in every age has proved that countries like England and America, which have become famous for the excellency of their mechanical appliances, have invariably rewarded labour far better than any other nations upon earth. In proportion as industry becomes more or less profitable, all engaged in it must feel the consequences in the world-wide competition.

The effect which the increased application of capital and machinery to industrial pursuits has upon the wage-earning classes was clearly defined by Bastiat in his "Harmonies of Political Economy "thus:" In proportion to the increase of capital, the absolute share of the total product falling to the capitalist is augmented, but his relative share is diminished; while, on the contrary, the share of the labourer is increased both absolutely and relatively."

The rich, on the other hand, who often look upon the stagnation of industry as a curse brought upon civilisation by the extravagance and extortion of the working classes are equally oblivious of the fact, clearly demonstrated by no less an authority than the great economist McCulloch, namely, that the inevitable result of a high rate of wages is to bring labour-saving machinery to greater perfection and thus, instead of destroying a nation's industries, enable it to distance all competitors. This, as he points out, is proved alike both by theory and experience. He therefore justly concludes that "the best interests of society require that wages should be elevated as high as possible—that a taste for the comforts, luxuries, and enjoyments of life should be widely diffused, and if possible interwoven with the national habits and prejudices."

And that most rigidly conservative writer, E. Atkinson, tells us, in his work on "The Distribution of Products," that "low rates of wages are not essential to a low cost of production, but, on the contrary, usually indicate a high cost of production. . . The cheapest labour is the best paid labour; it is the best paid labour applied to machinery that assures the largest product in ratio to the capital invested."

Many ridicule the very idea of trying to relieve industrial stagnation by Act of Parliament, but what, we should like to know, but wise legislation enables man to accumulate wealth at all? It is cowardly in the extreme to shut our eyes to stubborn facts or hide our heads like the ostrich in the face of danger instead of boldly meeting such questions like men.

If, as is pretended by monometallists, it is absolutely essential that our domestic currency should mainly consist, as at present, of gold, which is now failing us, the future prospects of our race appear gloomy in the extreme. If, as others maintain, the great march of human progress depends upon brain and muscle, or brave and willing hearts and strong arms, guided by wise legislation, rather than upon a few tons of one of the most intrinsically valueless of metals, then mankind have the remedy for the present depression entirely in their own hands; and when the electors imperatively demand some adequate machinery for the interchange of the fruits of their industry, it will be speedily forthcoming, to the injury of no man, but the incalculable benefit of all.

If coal or iron were running short, we might well tremble for the consequences, but reason distinctly tells us that gold and silver are merely toys which, when prejudices are outgrown, can be easily dispensed with. Those who are not wilfully blind must clearly perceive that civilisation is now tottering ominously upon the brink of a great crisis—one that may either overwhelm it for ever, or prove the dawn of an industrial millenium.

When reason can clearly trace the present world-wide calamity to some absurd blunder of statesmen—some defect in the currency laws—shall we superstitiously hesitate to try and retrace our steps, and, if possible, improve upon that circulating medium which was adopted by our barbarous ancestors to supply their little wants, page 15 when the great science of national finance was utterly unknown? That this is not merely what is called a soldier's battle, depending mainly upon courage, brute force, and endurance, is clearly proved by the indisputable fact that millions of careful, struggling, deserving men in every quarter of the globe, where a gold standard has been adopted, now find it utterly impossible to hold their own against the disastrous ebb tide of falling prices, by the most anxious, heart-breaking exertions, and incessant laborious toil.

The forlorn ships of State with their precious freights—the lives of millions-are drifting rapidly towards unknown dangers for want of able and far-seeing commanders to guide them, far more than from any lack of bold, enterprising, and industrious crews Who can deny that if equal facilities were afforded them the Anglo-Saxon race would be just as able and willing to create wealth of every description to-day as they were ten years ago. They have far better tools and machinery, and nature is just as bountiful as ever. No man living can assign any logical reason why, if supplied with a sufficiency of a reliable medium of exchange, and a just standard of value, the industrial classes could not now create wealth and prosperity on all sides just as rapidly as they did during the best days of the goldfields, or indeed far faster, for the supply of currency even then was always costly and uncertain, while the medium of exchange should be inexpensive, economical, and perfectly accessible at all times to any who are willing to give good value in exchange for it, since it has no conceivable limit short of the legitimate requirements of civilisation for the distribution of the fruits of industry. Any State that could contrive to keep all its people, who were willing to work, fully occupied in creating wealth, would soon be the greatest and richest nation upon earth.

When our settlers wish once more to find a ready and profitable sale for their produce, and to see their lands and other property grow steadily in value with the increase of population and the march of progress, as in former times, and are satisfied that they have had a sufficiency of cheerless and ever-increasing poverty, they will rise like one man and demand that their interests shall be protected against unjust foreign competition, by the adoption of an honest standard of value, and an adequate and inexpensive paper currency, such as suggested by economists, in lieu of that costly, contracted, and starving metallic one, for which we are now paying such a ruinous price.

The time has certainly fully arrived for Englishmen to decide once and for ever how much further they are willing to sacrifice the interests of themselves and their country to satisfy the unjust greed and rapacity of bondholders and bullionists, and enrich those teeming hordes of barbarians who still possess a silver standard.

Men may believe it or not, just as they please, but the fact is, as time will quickly prove, that all civilised nations are now being gradually reduced to the verge of starvation simply because the great artificial wheel of exchange has broken down under the excessive burden now imposed upon gold. It remains to be seen how long it will be before our statesmen rise equal to the simple task of again restoring it to page 16 working order. They might just as reasonably tell us that all ordinary machinery must be brought to a standstill until the present iron wheels could be replaced with ones made of gold, as pretend that the great wheel of exchange must necessarily collapse because they cannot obtain a sufficiency of that particular metal to answer the purposes both of a universal standard of value and domestic currency for the whole world.

Industry is manifestly suffering not from over-production but under consumption, the natural result of a contraction of the medium of exchange. This is proved to demonstration by the fact that all countries, except those using silver, are now both importing and exporting less than formerly—an infallible symptom of industrial and commercial decline. The marvels so lately effected by the untiring energy of man when the currency of the world was augmented by the recent gold discoveries have abundantly shown what labour can easily accomplish when supplied with a medium of exchange capable of expanding indefinitely in the same ratio as the legitimate requirements of industry and civilisation.

All lovers of peace and order must surely hope that public men will soon awake from their dangerous lethargy and realise without delay the awful responsibility that now rests upon them, and not cling madly to their golden idol till all existing institutions are overthrown to be succeeded perhaps by a reign of terror and brute force.

The great financial enigma now presented to all Governments which have adopted a gold standard, is like the riddle of the Sphinx—they must either solve it, and solve it speedily, or perish ignominiously. There is no alternative.

Bondholders and other interested parties taking advantage of the ignorance of the masses upon such questions, may contrive by ridicule—the usual cloak: of injustice—to throw dust in the eyes of the electors for a limited period, but hunger, which drives the wolf from the forest, will undoubtedly soon effectually arouse them to make a firm, determined, and united stand in self-defence. The apathy and criminal negligence of public men in this momentous crisis, when multitudes of willing, able, and industrious settlers are clamouring in vain for the humble privilege of being allowed to earn bread by the sweat of their brow to keep themselves and their families from starving, call vividly to mind the famous satire passed upon the aristocracy by Napoleon, when he compared the British army to a host of lions led on by a pack of asses.

We can only say, in conclusion, that we sincerely trust that, in spite of crafty, scheming bondholders, and blundering, shortsighted statesmen, the enterprising and indomitable Anglo-Saxon race is now only taking a step backwards to leap boldly forward the better in the immediate future.

We disdain to believe for an instant that when British workmen once fully realise what is now going on through the appreciation of gold they will tamely submit to be drained of their life-blood, and ground systematically down to poverty, degradation, and famine, to pamper and fatten their greedy and grasping rivals—the teeming and semi barbarous hordes of Northern Europe and Asia.

Although by means of an artificially contracted currency, and a viciously unjust standard of value they are now hopelessly handicapped out of the race of life, let their rulers only give them fair play and they can safely defy competition and hold their own fearlessly against every nation upon the face of the earth.