By far the most valuable practical knowledge that can illumine the mind of man, is that concerning money.  A correct knowledge of its principles and operations is worth more to the merchant and the man of enterprise than the capital invested in his business, and to the farmer, the artisan, the salary or wage-laborer, than the outcome of ten years of his toil.  Yet, even among merchants and those who conduct the great enterprises of the country, hardly one in a thousand has any real and correct knowledge of a matter which, more than all others, should receive their profound study.  It is almost universally true that that which is counted as a knowledge of money in reality is ignorance of the grossest character.  Out of that ignorance I have spoken things of which I am now ashamed and greatly grieved, and which I shall undo if life and the opportunity are spared me. --WEBSTER.

And I sincerely believe, with you, that banking establishments are more dangerous than standing armies ; --Thomas Jefferson to John Taylor, May 28, 1816
It is raising up a moneyed aristocracy in our country which has already set the government at defiance, --T.J. to Josephus Stuart, May 10, 1817.
Bank paper must be suppressed, and the circulating medium must be restored to the nation to whom it belongs. --T.J. to John Eppes, September 11, 1813.
Let banks continue if they please, but let them discount for cash alone or for treasury notes. --T.J. to John Eppes, September 11, 1813.

INTRODUCTION

AN eminent divine has truly said:  "All life is battling, all society a conflict of forces;  little worth having is ever got without being wrung from the teeth of opposition.  The student of history sees in every clause of the Bill of Rights the result of some successful battle fought to wrest a particular principle from the dominant class."

Never before in the history of the world has that condition of human affairs been so crystallized, never before have the forces of oppression been so thoroughly equipped and organized, and never before has the outcome of the conflict been fraught with such mighty import for good or ill to the human race as now.  When we look around the world what do we behold ?  We see in every quarter of the earth vast wealth or teeming abundance surrounded on every side by abject poverty.  In our own land, fairest and most favored of the earth, we indeed see "gaunt poverty stalking helpless through our streets" or lie famishing amidst plenty on every hand;  the fabled sufferings of Tantalus are made a living, breathing reality.  To declare that this condition is not of man's own production, is an insult and a libel upon a God of boundless love and mercy, and the supreme duty of the hour is for man to search out the cause of this condition and to apply the remedy.  In searching for that cause where must we look ?  Neither war, pestilence, nor famine has ravished our fields or desolated our homes.  The soil never ceases to yield its fruits in marvellous abundance, while the bowels of the earth teem in almost every section with untold wealth.  Then why this widespread ruin and desolation ?  Some very sagely inform us that we are suffering from over-production, others again tell us that the trouble is the tariff.  It is impossible for the difficulty to be over-production while millions of the people are suffering for want of the things produced.  To effectually brand that statement as either ignorance or cruel falsehood, one needs only to understand that the agriculturists of the South and the West, with bountiful crops at their disposal, are largely in a state of destitution, while millions of the toilers of the East are either idle, or but partially employed, and suffering for want of the products of both the East and the West.  No, over-production is not the cause.  Careful scientific investigation discloses the fact beyond the power of successful contradiction that the underlying, fundamental cause is to be found in a vicious, strictly dishonest monetary system, and tariff legislation at most can only aggravate or modify our deplorable condition.

A monetary system which throttles enterprise and paralyzes industry is vicious, and a monetary system that robs one portion of society for the benefit of another is strictly dishonest.  And such is the monetary system with which this nation is now afflicted.

MONEY has been appropriately called "the protoplasm of civilization, and as essential to its existence as oxygen is to animal life;  without money civilization could not have had a beginning, and with a diminishing supply civilization must languish and unless relieved finally perish."  To many who have not given the subject very deep consideration this assertion may seem to be overdrawn;  and that civilization could survive and the people could live by a system of barter.  A careful consideration of the subject is sufficient to satisfy the most sceptical mind that a system of barter can only supply man's immediate and commonest wants, that civilization absolutely requires for man far more than that supplied by the forest, or stream, or hamlet, or little spot of earth where he may chance to dwell;  that civilization requires for man a medium of exchange, an instrument of association by which he can command, at his own door if need be, the product of every clime and every nation, whether it be the spices of the Indies, the teas and silks of the Orient, the rich fruits from under the burning sun of the equator, the fish and fur of the colder zones, or any product of the earth that will conduce to his welfare and comfort.

Civilization requires for man something by which can command the avenues of intelligence;  education for himself and family -- something through which he can satisfy his taste for science, literature, sculpture, painting, or art in any or all of its varied forms.  All these man now commands through that instrument of association called money, the one thing only which can be used for the storage of labor for future use.  Let one imagine for a moment a person attempting to live by a system of barter.  If a farmer -- and no one perhaps is so well calculated to live by that system as the agriculturist -- with what would he pay for a postage-stamp ? with what would he pay for the use of the telegraph and the telephone ? and with what would he pay for an extended trip upon the railroad ? and how would that system work with the tailor, and the shoemaker, and the dentist, and the doctor, and the lawyer, and the banker ? and how would it work with those persons who do not produce anything ?  Will any person venture upon even slight reflection to question this statement, that "money is the protoplasm of civilization and as essential to its existence as oxygen is to animal life ?"  Sir Archibald Allison, one of England's most brilliant historians, has this to say concerning money:

"The two greatest events in the history of mankind have been brought about by a contraction, and on the other hand an expansion of the circulating medium of society.  The fall of the Roman Empire, so long ascribed in ignorance to slavery, to heathenism, and to moral corruption, was in reality brought about by a decline in the silver and gold mines of Spain and Greece;  and, as if Providence had intended to reveal in the clearest manner the influence of this mighty agent on human affairs, the resurrection of mankind from the ruin which those causes had produced was owing to the directly opposite set of agencies being put in operation.  Columbus led the way in the career of renovation.  When he set his sails across the Atlantic he bore mankind and its fortunes in his bark;  the annual supply of the precious metals for the use of the globe was tripled before a century had elapsed, the price of every species of produce was quadrupled, the weight of debt and taxes insensibly wore off under the influence of that prodigious increase.  In the renovation of the industries the relations of society were changed, the weight of feudalism cast off, the rights of man established.  Among the many concurring causes the most important, though hitherto the least observed, was the discovery of Mexico and Peru (their gold and silver mines)."

David Hume says:

" We find that in every kingdom where money begins to flow in greater abundance than formerly, everything takes on a new face, labor and industry gain life, the merchant becomes more enterprising, the manufacturer more diligent and skilful, and even the farmer follows his plough with greater alacrity and attention."

And Hume further shows that the only honest money, the best, the soundest money is a money the volume of which increases in exact ratio with population and the uses for money.  In fact, no other money can be sound, no other money can be honest.

In no other way possible can justice and equity be maintained between man and man.  In the multiplicity of debts and obligations amounting to tens of thousands of millions of dollars, all calling for liquidation in money payments, how supremely important to every person engaged in industry and enterprise of whatever kind that the money standard should be of equable and unvarying value ?  In no way possible can that equable and unvarying value be maintained except by an increase of the money volume that will keep even pace with the increase of population and the uses for money.  Any other kind of money is a fraud and a snare, and disarranges all business calculations and transactions and places in the hands of unscrupulous men the most subtle and potent power for robbing their fellow-men, possible for the mind to conceive.

Demand relative to the supply is the sole factor in determining value.  An increase or decrease in demand, without a corresponding increase or decrease in the supply of any article whatever, changes its value in exact ratio.  And this law governs the value of money as perfectly as it does that of any other material on earth.  How absurd then to call a money honest which does not increase in exact ratio with demand !  What stupidity to suppose that an honest system of money can be maintained based upon a single metal, over the volume of which man has scarce more control than he has over the winds of heaven !  What supreme folly to adopt for a money standard a commodity so scarce, so variable, and uncertain of production as gold ! -- making money the master and not the servant of man, squarely reversing the order of things plainly set by an all-wise Creator.  That there has been a thoroughly organized and systematic effort to conceal and obscure the true principles of money and to mystify and deceive the people concerning monetary science from the time of the suspension of silver coinage in England in 1798, there can remain no possible shadow of doubt.  The systematic purchase and control of many of the leading dailies in our great cities, by the banking and bondholding interests of this country and of Europe, should of itself awaken grave suspicion in the minds of the American people as to the truthfulness of the financial principles which those journals so fiercely promulgate.  The man who should propose a standard of weight or a standard of length that would greatly expand or contract with every change of temperature, would be regarded as a gibbering idiot, -- and yet the adoption of such a standard of weight and length would in reality be crystallized wisdom compared to the selection of X commodity so uncertain as gold for a money standard, as the writer proposes to plainly prove.  And why is the money standard of infinitely greater importance than standards of weight and length ?  Simply because only a portion of man's products are measured by weight and length, while, on the other hand, money is the measuring instrument which not only measures those products, but every other exchangeable product of human skill, whether of hand or brain;  because money is the pricing instrument of all marketable things upon which man's material prosperity depends.  Nor is it within the bounds of possibility to maintain a perfectly just and proper system of money based on both metals, gold and silver.  The most that could with reason be expected from such a system would be a vast mitigation of the evils of a currency based upon a single metal.  A man can walk about with two good sound legs far better than he can with only one leg, no matter how many crutches he calls to his aid;  and the body politic is as greatly advantaged by the two metals for a monetary base instead of but one, as the individual is advantaged by two good legs instead of one.  Substantial proof of this fact is not alone founded on reason and common sense, but positive, unquestioned proof is furnished by the illustrious example of France whose monetary system consists of nearly equal parts of gold and silver, strengthened by an ample issue of full legal-tender paper money.

Now, if the production and distribution of gold were so completely under the control of man that its supply for money use could at any and at all times be made to increase in exact ratio with the vast and constantly expanding demand for money, and that money volume properly protected, then would the advocates of a single gold standard have a foundation based, in a measure at least, upon reason and common sense for their contention.  But, in the absence of such a condition, it is just as impossible to make one truthful argument in behalf of a single gold standard as it is to make one truthful argument in defence of vice, or one truthful argument in defence of the claim that black is white, or that two and two do not make four.  And why cannot one truthful argument be made in defence of a single gold standard ?  For the best and most unanswerable of all reasons, that in order to do so it is absolutely essential to ignore and deny the fundamental principle which governs the value of money -- namely, quantity relative to its uses, the irrevocable law of supply and demand which governs the value of all things material, to which law money is in no wise an exception.  It is this law which makes it as impossible to produce one single truthful argument in behalf of the single gold standard as it would be to produce one single truthful argument in behalf of some mechanism that ignores and runs counter to the law of gravitation.

The laws which govern the universe are perfect and absolute, and the laws which govern the value of money are just as perfect and absolute as any other in the natural world, and just as easy of solution.  How perfect and absolute are the laws which govern every blade of grass, every bud, flower, and fruit, every grain of sand, every germ of vegetable and animal life, in fact, which govern every one of the countless myriad of things in the universe, animate and inanimate !  This truth can be plainly seen by every one, and yet we are craftily told that money, a simple and pure invention of man, is entirely above and superior to natural law;  one eminent gold-standard scientist going so far as even to vaguely connect the recurring spots upon the sun with the periodicity of financial panics !  That there is an all-powerful and dominant effort to deceive mankind concerning money is entirely too plain for denial.  A thorough knowledge of the motive for that effort will greatly aid one to understand why false statements concerning money are so persistently disseminated.

There is nothing more certain within the whole range of human achievement than the fact that those "who control the wealth of the world control the world itself," and in the control of the last they fortify themselves in the control of the first.  And this is the gigantic prize which is being fought for upon the world's chessboard at the present moment.  We find arrayed upon the one side a small but intensely powerful fraction of mankind, fortified by the achieved wealth of the world and fully armed with that perfection of craft and consummate skill that generations of tireless, determined effort has produced and developed into a fine art;  while upon the other hand we find the countless toiling millions of the world's great hive, the brave and honest producers of the world's vast wealth, toiling on almost totally unconscious of the tremendous stake that is being played for, the result of which will be either to rivet securely upon them the chains of an industrial slavery that will effectually make them the hewers of wood and the drawers of water for that other small but intensely powerful fraction of humanity, or emancipate the civilized world from the galling fetters of a bondage that has for ages sucked the life-blood of industry, throttled enterprise, and steeped mankind in misery -- a bondage that has done far more to brutalize and degrade, to criminalize and impoverish, the human race than all the wars, pestilences, and famines that have ever occurred since the creation of man;  a bondage that stifles the nobler aspirations of man and transforms the germs of brotherly love and sympathy of the human heart into the cruel and pitiless instincts of the beast of prey.  Such an economic condition of human affairs in this supposed enlightened nineteenth century will no doubt seem out of the question to most readers.  To all such the writer asks only a careful and impartial examination of the facts and statements set forth in this treatise on money.  If he has made so much as one false statement in regard to the economic principles of money, that fact can be easily ascertained;  and if he has failed in the slightest degree plainly to disprove the multitude of false statements made by those who seek to establish the cruel monstrosity of a single gold standard, that fact also can be easily shown.

The Rev. T. DeWitt Talmage characterizes the misrepresentations of political campaigns as follows:

" At every yearly and quadrennial election we have in this country great manufactories of lies. ... Large lies and small lies;  lies private and lies public and lies prurient;  lies cut bias, and lies cut diagonal;  long-limbed lies, and lies with double back-action;  lies complimentary, and lies defamatory;  lies that some people believe, and lies that all people believe, and lies that nobody believes;  lies with humps like camels and scales like crocodiles and necks as long as storks and feet as swift as antelopes, and stings like adders;  lies raw and scalloped and panned and stewed;  crawling lies and jumping lies, and soaring lies;  lies with attachment screws and rufflers and braiders and readywound bobbins. ..."

This description by the Rev. Mr. Talmage may fully cover the diversified variety of election lies, but it would no more describe the exquisitely ornate and skilfully executed lies concerning money than would the crudest wooden god of the Hindoos compare in statuary with the masterpieces of Phidias and Praxiteles, or the rude hut of the Hottentot compare with the Parthenon and Ephesian temple in architecture.

A story is told of a Greek painter who made a picture of fruit so natural that the birds pecked it, and of another Greek painter so much more skilful that he deceived the one who had deceived the birds.  And the monetary liar holds the position among all other liars that the last Greek painter held to all the others in the art of painting.  The monetary liar so skilfully erects a superstructure of falsehood upon a foundation of truth that he readily deceives those who could not be induced to notice the most plausible election lie.  So skilfully does he mix truth with falsehood that the ordinary man of business, however intelligent, becomes mystified and confused in his examination of the subject, and usually concludes that the question is too complex and abstruse for the limited time that he can spare for its examination, and contents himself by assuming that that must be the truth which is so plausibly set before him.

The purport of this treatise on money, is to make the true principles of money so plain that "he who runs may read," and "the wayfaring man, though a fool, need not err therein."

CHAPTER II.
THE PRINCIPLE OF VALUE.
THE ONLY KEY TO A CORRECT UNDERSTANDING OF THE MONEY QUESTION.

A WISE person wishing to visit a distant city, makes sure to get on board the right train.  Though scores of other trains are seemingly travelling in the same direction, yet if he fails to get on the right one, sooner or later he will be led astray.  And precisely so with the person who sets out to investigate the question of monetary science:  he must make sure that he is in possession of the right key if he wishes to arrive at a correct conclusion.  The true key, and the only key that will unlock or uncover all the devices that craft and cunning can arrange for man's deception, is the inexorable, unalterable law of supply and demand -- the inexorable law that governs the value of every material on earth, the same law precisely that governs the value of houses, lands, wheat, potatoes, or anything else.  The value of each unit of money is determined by the number of units in circulation;  in other and plainer words, the value or purchasing power of each dollar of money is determined by the number of dollars in circulation.

Quantity relative to its uses is the determining factor.  With a firm hold upon this thread no one need fear going astray in solving monetary problems, no matter how devious, how intricate the labyrinth.  Plato plainly saw this principle of money twenty-three hundred years ago, when he advised for the state, for internal trade, a money having no commodity value -- that is, a money without what we erroneously call intrinsic value.  Plato plainly foresaw the evils of a currency the volume of which could be injuriously affected by export.  Six hundred years later Paulus, the Roman jurisconsul, recognized this same principle of money, and it was afterward incorporated in the Pandects of Justinian.  But coming down to more modern political economists, and beginning with John Locke, the latter said:

" While the same amount of money is travelling up and down the kingdom, alterations in value are truly in other things only;  but if you increase or diminish the quantity of money current in traffic in any place, then the alteration in value is in the money."

In this assertion Locke plainly recognizes the inexorable law of supply and demand, for "while the same amount of money is passing up and down the kingdom," he says, "alterations in value are truly in other things only" -- that is, changes in the price of goods are not caused by the money, because the amount of money has not been changed;  but that the changes in price are caused by the natural changes in the supply and demand of the goods themselves.  We see this fact constantly illustrated in our everyday life by the changes in price caused by an excessively large or an unusually small crop or supply of grain, fruit, or anything else -- a simple illustration of the irrevocable law of supply and demand as affecting value.  But Locke says :

" If you increase or diminish the quantity of money current in traffic in any place, then the alterations in value is in the money."

Here, then, is a plain and emphatic assertion that the law of supply and demand governs the value of money, precisely the same as it does that of all other things.  Locke of course assumes it to be understood that he refers only to an increase or decrease in the quantity of money where the demand remains the same, that is, without increase or decrease;  for if the demand should increase or decrease in exact ratio with the increase or decrease in the quantity of money, then the value of the money would not change, the relation of supply to demand being exactly the same.

Adam Smith, in his Wealth of Nations, says:

" Gold and silver, like every other commodity, vary in their value.  The discovery of the abundant mines of America reduced, in the fifteenth century, the value of gold and silver in Europe to about one-third of what it had been before.  This revolution in their value, though perhaps the greatest, is by no means the only one of which history gives us some account."

And Adam Smith was supposed to have some knowledge of what he wrote.  David Ricardo, than whom few persons have ever lived who possessed a more accurate knowledge of monetary science, said:  "The value of money in any country is determined by the amount existing;  that commodities would rise or fall in price in proportion to the increase or diminution of money I assume as a fact that is incontrovertible."

John Stuart Mill testifies to precisely the same effect in other words.  Mill says:

"The value of money, other things remaining the same, varies inversely as to its quantity, every increase in its quantity lowering its value and every diminution of its quantity raising its value in a ratio exactly equivalent."

David Hume says:

" It is not difficult to perceive that it is the total quantity of the money in circulation in any country which determines what portion of that quantity shall exchange for a certain portion of the goods or commodities of that country.  It is the proportion between the circulating money and the commodities in the market which determines the price."

Huskinson says:

" If the quantity of gold, in a country whose currency consists of gold, should be increased in any given proportion, the quantity of other articles and the demand for them remaining the same;  the value of any given commodity measured in the coin of that country would be increased in the same proportion."

Professor De Colange says:

" The rate at which money exchanges for other things is determined by its quantity. ... Supposing the amount of trade and mode of circulation to remain stationary, if the amount of money be increased its value will fall and the price of other commodities will proportionately rise, as the latter will then exchange against a greater amount of money; if, on the other hand, the quantity of money be reduced, its value will be raised, and prices in a corresponding degree be diminished, as commodities will then have to be exchanged for a less amount of money. ... In whatever degree, therefore, the quantity of money is increased or diminished, other things remaining the same, in that same proportion the value of the whole and of every part is reciprocably diminished or increased."

Senator John P. Jones, in his exhaustive and admirable speech on money before the United States Senate in October, 1893, against the repeal of the Sherman act, says:

" So absolutely clear are the leading writers that the value of the money unit is in every case, other things being equal, determined by the number of units out, and does not depend on the material of which the money may be composed, that they have not the slightest hesitation in asserting that the rule applies even to uncovered paper money, so that the value of every dollar of gold and silver in circulation is diminished or increased according as the quantity of paper money is increased or diminished;  and reciprocably as to all of these the increase in the number of dollars of either kind diminishing the value of each dollar of the others, while the decrease in the number increases the value of each of the others, without the slightest regard whatever to the material of which either of the dollars is composed.  If this be so, if the value of the unit of money depends, not on the material of the dollars, but on their quantity, what becomes of the gold standard ?  If this be so, inasmuch as silver has been utilized as money since the dawn of creation, why abandon it now, unless senators are prepared to abandon the automatic system altogether ?  If we must, by legislation, compel a change in the value of money (for that is what this measure means), why legislate so that it can change in one direction only, and that the direction which is always favorable to the classes that lend money and live idly on their incomes -- the direction most injurious to society, most fatal to industry, most narcotizing to energy ?"

Fawcett says :

"In discussing the laws of price, the principle was established that general prices depend upon the quantity of money in circulation compared with the wealth which is bought and sold with money, and also upon the frequency with which this wealth is bought and sold before it is consumed.  If more wealth is produced, and an increased quantity of wealth is bought and sold for money, general prices must decline, unless a larger quantity of money is brought into circulation."

That is, no money can be "sound" or "honest" money which does not increase in exact ratio with the increase of population and the uses for money, or, in other words, where the supply of money does not increase evenly with the demand.  In further substantiation of this, Fawcett says:

"The amount of money required to be kept in circulation depends upon the amount of wealth which is exchanged for money.  Hence, cœteris paribus, the amount of money ought to increase as the population and wealth of a country advance."

Testimony to substantiate this fundamental principle of money from all the ablest economists who have ever written upon money can be added indefinitely.  In fact, never until the present day has there ever been so thoroughly organized and systematic, an effort to conceal and obscure this fundamental principle of money as the organized effort we now see so energetically forced upon the American people, an organized effort systematically executed.  Unless there was a thoroughly organized effort to conceal and obscure the true principles of money, it would be impossible for so many of the leading newspapers to be systematically engaged in teaching false principles of money.  That many of our leading newspapers are so engaged will doubtless seem to many a startling assertion, but the truth of that assertion is susceptible of positive proof.  Neither is this venal condition of the American press so very strange or remarkable when one fairly understands the natural and easy methods by which it has been brought about.  Were all legislation concerning railroads controlled almost wholly by the officers and stockholders of the roads, would it be at all strange if such legislation resulted greatly to the interests of those corporations, while the interests of the people receive but scant consideration ?  More especially if in addition to this the newspaper press was largely owned and controlled by the railroad corporations, and the leading dailies teemed with laudatory editorials of the honest methods and sound policy of the railroad management, with just sufficient adverse criticism to make the people believe that the editors were strictly impartial, and that their sole aim was the people's interests.  Or, again, suppose that all legislation concerning trusts was largely controlled by the owners and attorneys of the trusts, and they largely controlled the newspaper press, would it be at all strange if such legislation resulted greatly to the interests of the trusts, no matter how detrimental such interests might be to the people generally ?  Well, if such results would be a natural sequence of such conditions, can it be wondered at that financial legislation inimical to the true interests of the people has found place when such conditions accurately represent the conditions under which much of our financial legislation has been accomplished ?  For more than twenty-five years the banking and bond-holding trust has been in the saddle;  that mighty corporation, now grown to colossal proportions, has kept its sappers and miners steadily at work, having for its object the control of Congressional and Presidential elections, and especially the control of the newspaper press, that potent machine for moulding public opinion.  None know better, aye, few know so well as they the absolute necessity of muzzling that palladium of American liberty in order to enslave the freemen of America.  They well understand that with the public press against them all their efforts in that direction would be as futile as to attempt to dam the Mississippi with straw, or to turn the earth backward on its axis.  But shrewdly calculating the magnitude of the task which they have undertaken, and with ability unsurpassed for the treasonable work, they have labored without ceasing and lavished their means without stint, until they now stand upon the threshold of a success far surpassing their wildest dreams at the inception of their effort.  The undertaking has been the most extraordinary in character and magnitude, and the most phenomenal in its success thus far in all recorded history.  Their object in concealing and obscuring the fundamental principle which governs the value of money is plainly seen, when one fairly understands that for them to admit that principle would sweep away every vestige of foundation for that unequalled instrument of power for robbing mankind called the gold standard.  If they should once fairly admit the true principle which governs the value of money, the people would then see plainly that that which the bankers' newspapers have with such persistent vehemence held up before their eyes as a standard is in reality no standard at all, unless a standard of oppression and injustice can be considered a desirable standard.

To admit the fundamental principle which governs the value of money would plainly show the people that gold can no more be a standard of value than can the temperature on January 1st be a standard of temperature for the rest of the year.  If the value of each dollar of money is determined by the number of dollars in circulation (a law of money as perfect as the law of gravitation), then gold is the least qualified perhaps of any material on earth for a money standard except diamonds, the volume of gold being so variable in amount, and so easily manipulated for selfish purposes by those possessed of the power to do so, that a dollar may have one value to-day, another value to-morrow, and still some other value next week, completely disarranging the most careful business calculations, paralyzing industry of every description, throttling enterprise and leaving in its track death, desolation, and misery no less real than that made by war, pestilence, or famine.  In every transaction where money is exchanged for commodities the money is bought just the same as the commodities, and the money is dear or cheap or normal according to the amount of commodities which it takes to buy it.  It is a matter of absolute necessity to both the material and moral prosperity and welfare of the nation that money should be of uniform, unvarying value.  Contrary to the belief of some political economists the science of political economy is pre-eminently a moral science -- imperatively demanding a firm foundation of strict justice.

To point to the commodity gold as a standard of value is just as idiotic if sincere, and just as treacherously dishonest if not sincere, as for an engineer to remove the figures on the dial of his steam gauge and then fasten the desired figures on the end of the indicator, so that whether the indicator travels little or much around the dial it would always point to the desired number of pounds pressure.  There, of course, would remain this difference: that while the action of the engineer concerned only the welfare and safety of a few individuals, the action of those who control the money standard concerns the welfare and safety a mighty nation.

It is said that persons making ascensions by balloon are greatly impressed with the optical illusion that they are standing still and that the earth is dropping away.  The illusion that gold is a standard of value, and that it is only commodities that change in price, is precisely identical with the optical illusion of the man in a balloon.

Prof. Stanley Jevons says that the value of gold fell between 1789 and 1809 forty-six per cent, and from 1809 to 1849 it rose one hundred and forty-five per cent, and from 1849 to 1869 it fell again over twenty per cent.  That it has enormously increased in value within the last twenty or twenty-five years is conceded by all impartial judges.  This great increase in the value of money since 1872 has been caused by the vast increase in the demand for money without any corresponding increase in the money supply -- positive proof that the value of money is determined by its quantity under the inflexible law of supply and demand.

It has been said of an eminent Greek that he possessed the art of dissembling in so high a degree that he could make the deepest villainy appear like the highest virtue.  Catiline, the Roman, is also said to have possessed the same art in a high degree.  Could they reappear upon the earth to-day, and take a survey of present economic conditions, no doubt they would stand aghast with open-mouthed wonder to see the artistic flights of skill educed by the dissemblers of monetary science, -- as, for instance, a series of articles in the New York Times of January and, February, 1895, running through eleven issues and containing thirty-one chapters, in which the writer, with the most ornate academic conclusions and deductions, attempted to prove clearly that the greenback or national currency which preserved this nation in its hour of extreme peril, and which as the tool of trade and commerce created for this nation thousands of millions of material wealth and placed it in the very forefront of the nations of the earth, did not in reality do any of these things (in his opinion), but, on the contrary, subjected the American people to a net loss of over $2,400,000,000.

Another example in point is a long article fully as scholastic but somewhat less subtle, by Henry Dunning McLeod, which appeared in the New York Evening Post of November 12th, 1894, reprinted in full from the Century Magazine, and which the editor of the Post declared to be the "most crushing reply to the bimetallists" and "trenchant exposure of the bimetallic fallacies" he had ever read.  The entire article was an effort to prove that the commodity value of gold and silver always governed the mint value.  In substantiation of this he cited the historical facts that full-weight coins of either metal never remained in circulation in England or France when the commodity value of the metal was greater than the coinage value.  The cause of the higher commodity value he was very careful not to explain, for the explanation would have swept away his whole contention.  He neglected to explain that a higher commodity value for either metal in one country was invariably caused by a higher mint value in some other with which there were close commercial relations, and that every change in a mint ratio caused a change in the commodity value with the precision of clockwork.  We are commanded to be charitable, but is it not putting too great a strain upon charity to suppose that Henry Dunning McLeod or the editor of the the Evening Post did not fully understand the cause of the greater commodity value of either metal, when any intelligent schoolboy of fourteen could fully do so ?

The purpose of this treatise on money is to clearly expose the sophistries and arguments of the would-be perpetrators of the gold standard;  to take each and every one of the many arguments which they have thus far, advanced, and so place them under the searchlight of truth that every honest man of ordinary intelligence can with little effort plainly see their untruthfulness.

In order that the exact truth may be reached it is imperatively necessary to obtain clearly the true starting-point or foundation.  Without this true starting-point a correct knowledge of monetary science can no more be obtained than can be obtained a correct knowledge of astronomy by assuming that the earth is the centre of the solar system and that the sun and all the planets revolve round it.

Without this correct starting-point all efforts to understand the question must inevitably result in inextricable confusion and disappointment.  But with a full comprehension of the fact that quantity relative to its uses is the sole factor in determining the value of money, all else will be comparatively easy, and we may then safely advance to another point for consideration, that of value.

A RIGID conformity, to pedantic rules would have dictated, perhaps, that a consideration of the thing we call value should have preceded a consideration of the fundamental principle which governs the value of money.  However, this work is not designed far an extended treatise on political economy, but only that portion of it which directly concerns the science of money, though, of course, the question of money is to political economy what the machinery is to a steamship, or the blood to the human system.

Vague and erroneous ideas of what constitutes value are very largely responsible for the dire evils of a vicious monetary system.  Until one has a clear conception of the true nature of value he cannot feel perfectly assured that he is firmly fixed on the very bedrock of truth in assuming that quantity, relative to its uses, is the sole factor in determining the value of money.  Economists themselves are frequently inaccurate and contradictory in defining the nature of value.  Such being the case, can it be wondered at that the people generally fall an easy prey to the craft and cunning of designing men, who who have the most powerful of reasons for deceiving them as to the true science of the creation and distribution of wealth ?

Value, unlike matter, is not a concrete substance, but wholly the result of conditions.  The value of any stated material or thing is entirely dependent upon circumstances, and its value may change just as often, as the conditions change.  Could the same material or thing be placed under one thousand different conditions that material or thing would have one thousand different values, except, of course, when a divergence in one direction just compensated for a divergence in some other.

Herein lies the great secret of commercial prosperity.  Ordinarily those persons will be the most successful in business who, having a foreknowledge of future conditions, can the most accurately gauge the effects upon values that those future conditions will produce.  It is common knowledge of all men that a partial failure for one or more years in the crop or supply of wheat, corn, potatoes, or any other thing, will materially advance the price or cost of that thing.  A total failure for one or more years -- demand remaining the same -- will enormously advance the price or cost of that thing, while on the other hand an abnormally large that or supply has the opposite effect.  Again, any material interruption of the normal condition of commerce, whether through war, pestilence, famine, blockades, or other disturbances, disarranges in a greater or less degree the values of every article affected by such disturbances.

Furthermore, we find that location is an exceedingly potent factor in determining value.  The same thing may have 100 different values in 100 different places;  for instance, wheat may have a value of 80 cents per bushel in New York city, 60 cents in Chicago, and only 30 cents on the plains of Dakota or Kansas.  Apples and potatoes may sell for $1 per bushel in Boston and only 15 cents per bushel in Michigan.  Eggs may sell at 25 cents per dozen in the city and only 10 cents per dozen in the country.  Facilities for market, cost of transportation, cost of production, in fact innumerable changes in the circumstances under which a thing is placed, will cause innumerable changes in the price of that thing.

The writer has seen virgin forests of magnificent timber, miles upon miles in extent, possessed of little or no value at the time -- owing to lack of facilities for lumbering and reaching a market -- which, a few years later, when conditions were changed and the difficulties of reaching a market removed, then possessed a marketable value of $10 to $25 and even $50 per acre.

Del Mar, referring to the era of Lycurgus, says:

" It began to be suspected that the monetary problem was not a mechanical one at all;  that unlike weight, length, capacity, etc., value was not an intrinsic or inalienable at tribute of matter, and therefore that it could not be equitably measured by means of any commodity as a commodity.  What then was value ?  From that time to the present, -- that is to say, for nearly thirty centuries -- the vaults of the earth have echoed the question, but vouchsafed no reply.  The priests of Egypt, if they knew the answer, preserved it among their numerous mysteries of statecraft, to be sold to tyrants or employed in the service of the gods.  The seers of Chaldæa and Greece, who disclosed to the western world the majestic movements of the heavenly bodies, failed to recognize the nature of value, or else kept it an unwritten secret that it might be employed in the subversion of civil liberty.

" 'The function of money is to measure value,' declared the school of Lycurgus, but neither the Spartan sages nor the great Stagyrite who in a later age voiced their philosophical maxims ever registered a definition of value.  However, not to register a definition of value is not necessarily to be ignorant of its function."

That the money-changers of Wall and Lombard streets and their continental allies have long been thoroughly conversant with the true nature of value down to its minutest tinge or shade there can be no reasonable question of doubt.  The seers of Chaldæa would prove easy victims to their matchless skill in making the ephah small and the shekel great.

" Value is a relation and therefore cannot be measured, but only expressed or stated," says Francis A. Walker.  "Value is a ratio," says McLeod.  "Value is purely relative," says John Stuart Mill.  "Value is an extrinsic accident or relation," says Prof. W. Stanley Jevons.

That value is not a concrete substance, -- that like faith or hope or joy, or pleasure or pain, or touch, or taste, or smell, it cannot be weighed or measured, must appear to the most unphilosophical mind as a self-evident proposition.

What "woes unnumbered" might have been averted from the human race within even the last half-century, had the acute minds of Adam Smith and David Ricardo and Prof. Stanley Jevons and John Stuart Mill but followed to its logical conclusion the broad foundation that value is only a ratio, a pure creation of circumstances and conditions, instead of trying to make it conform to a venerable superstition.

" Great is Allah and Mohammed is his prophet," say, the Moslem.  "Great is the economic edifice and gold is the corner-stone," say in effect these great economists.  If any be degraded by the comparison it assuredly is not the Moslem.

Is it true, does the reader ask, that these great economists do not follow science to its logical conclusion, but try to make it conform to a petted theory ?  Well, here is the proof :

"Value is a ratio," says McLeod.  "Value is an extrinsic accident or relation," says the great W. Stanley Jevons, professor of political economy in Owens College, Manchester, and University College, London.  But when confronted with the alternative of sweeping away the halo of superstition that selfish greed has with such infinite pains enveloped the golden idol, or controverting science, Professor Jevons prefers the latter by declaring:  "Since money has to be exchanged for valuable goods, it must itself possess value."  Shades of Plato and Aristotle ! weep salty tears in memory of thy mutilated child !

What !  Money possess a ratio ?  Money possess extrinsic accident and relation ?

"Value is purely relative," says John Stuart Mill in his Principles of Political Economy.

" The value of money is to appearance an expression as precise, as free from possibility of misunderstanding as any in science.  The value of a thing is what it will exchange for.  The value of money is what money will exchange for, the purchasing power of money.  If prices are low, money will buy much of other things, and is of high value.  If prices are high it will buy little of other things and is of low value.

" The value of money is inversely as general prices, falling as they rise, and rising as they fall.

" When one person lends to another as well as when he pays wages, or rent to another, what he transfers is not the mere money, but a right to a certain value of the produce of the country to be selected at pleasure. ...

"It must be evident, however, that the mere introduction of a particular mode of exchanging things for one another, by first exchanging a thing for money and then exchanging that money for so something else, makes no difference in the essential character of transactions.  It is not with money that things are really purchased.  Nobody's income (except that of the gold or silver miner) is derived from the precious metals;  the (dollars or cents) which a person receives weekly or yearly are not what constitutes his income.  They are a sort of tickets or orders, which he can present for payment at any shop he pleases, and which entitle him to receive a certain value of any commodity that he makes choice of.  The farmer pays his laborers and his landlord in these tickets as the most convenient plan for himself and them;  but their real income is their share of his corn, cattle, and hay, and it makes no essential difference whether he distributes it to them directly or sells it for them and gives them the price.

" There cannot, in short, be intrinsically a more insignificant thing in the economy of society than money, except in the character of a contrivance for sparing time and labor.  It is a machine for doing quickly and commodiously what would be done, though less quickly and commodiously, without it, and, like many other kinds of machinery, it only exerts a distinct and independent influence of its own when it gets out of order."*

Here Mr. Mill clearly and explicitly declares the true character of money -- namely, that it is merely an invention of man, an instrument for facilitating exchanges, by selecting some convenient material and method with which the value of all things can be estimated.  He clearly states that the coins are not the real wealth, but merely the tickets or orders which entitles the holder to demand from society that portion of its real wealth which those coins or tickets entitle the holder, precisely the same as a ticket to a theatrical performance or a ticket for a ride on a railroad merely entitles the holder to obtain that which the ticket calls for.  The only difference between money and a theatre or a railroad ticket is that the former is a general order upon society for all things, and the latter entitles the holder to only one specified thing.

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* Principles of Political Economy, by John Stuart Mill.  Revised by J. Laurence Laughlin, p. 293.

The purchaser of a theatre or railroad ticket does not examine or stop for one moment to consider the material of which the ticket is composed.  He wishes to know only whether it will perfectly secure to him the desired service.  So long as it perfectly performs this office, there can be no advantage in its being made of the purest gold and studded with the most precious gems, instead of the cheapest material on earth -- on the contrary, most likely a disadvantage, being less convenient.

After clearly and forcibly explaining the true character of money and emphatically declaring it to be intrinsically the most insignificant thing in the economy of society, Mr. Mill, in order that the fetish of a gold standard may be sacredly preserved, declares that the very first requisite of a perfect money is value.  In another place he declares that the "ultimate regulator of its value [money] is cost of production."^[2]  And the sum of his hypotheses in other places is that the cost of production is determined by the value of the money.

Into what an inextricable morass of inconsistencies and contradictions the scientist is plunged who turns aside from the unerring path of truth !  An epitome of Mr. Mill's deductions we find to be as follows: That money is the most insignificant thing in the economy of society;  that the first requisite of that most insignificant thing is value, that value is a ratio depending wholly upon circumstances and condition;  that money must possess a ratio;  must possess circumstances and condition;  and that the value of money is governed by the cost of production, and the cost of production is determined by the value of the money.

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2 Principles of Political Economy, by John Stuart Mill, revised by J. Laurence Laughlin, p. 292.

Which is about equivalent to saying that the velocity of the earth is governed by the sun's attraction, and the sun's attraction is governed by the velocity of the earth. And this is put forth in our text-books for colleges as the highest wisdom upon the most important subject that concerns man's material prosperity, and not only man's temporal condition, but exerting an incalculable influence upon his spiritual welfare, poverty being the prolific parent of degradation and crime.

"Happily," says Mr. Mill, "there is nothing in the laws of value which remains for the present or any future writer to clear up.  The theory of the subject is complete."

This vividly recalls a statement of Dr. Phillips, who says:  "In the preface of a medical treatise, written at the beginning of this century, these words appear:  'The present perfect state of medical science renders it impossible to record any further discoveries.  We can only arrange what is already known.'  As a man who should now practise the aforesaid 'perfect state' of medicine would justly be lodged in jail for manslaughter, we smile at the conceit of this simple-minded doctor."

But what else might in reason be expected "from an economist who regards theory as superior to practice ?