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and that such deficiency—even if a much higher estimate than that of Mr. Pixley's is adopted-has for each and every year for a considerable period been far more than supplemented and made good by the reduction in the amount of capital, in the form of money, which the increased facilities for doing business have permitted and effected, is a proposition also which it would seem could not well be doubted.*

The evidence, therefore, seems to fully warrant the following conclusions : that the tendency of the age is to use continually less and less of coin in the transaction of business ; t and that “so far from there being any scarcity of gold, there never was a period in the world's commercial history when the existing quantity was so large as at present, in proportion to the necessity for its use or the purposes it has to serve."

It is also exceedingly interesting and significant to note here how completely the most distinguished advocate of the desirability of enlarging the function and use of silver in coinage has repudiated the idea that the recent phenomenal decline of prices has been occasioned by a scarcity of gold. Thus, under date of April 24, 1886, M. Cernuschi thus writes in the London “Economist”: “ The fall of prices which is complained of is not due to what has been called a scarcity of gold-a scarcity which is purely imaginary.” M. Sauerbeck, in referring to this matter (“Journal of the Royal Statistical Society," September, 1886), also says: “A scarcity" (of gold) “as understood by bankers does not exist. Prices have fallen so much that scarcity is not observable. As Mr. Giffen pointed out, there may be enough for present requirements, and the scarcity will only be felt when prices rise.” But if prices have fallen through the ingenuity of man, will prices return to their former level ? Certainly not, unless the coming man is less ingenious than his present representatives, and Nature is to be less generous in the future of her resources.

* " The trade of the world is carried on by credit and capital, and any causes affecting these essentials have infinitely greater effect on prices than a slight proportionate in. crease or decrease in the production of gold. A merchant may not hold ten sovereigns, but he may have capital and credit for ten millions. An ingenious statistician has calculated the capital of the world in 1880 at £46,000,000,000" (sterling—$230,000,000,000), “and if credit and capital have had the main voice in the question of prices, how minute must have been the effect on the markets of an annual reduction in the production of floating capital of ten (sterling) millions per annum, from a short period of most exceptional production ; especially wben the falling off has been more than balanced by the increased economy in the use of gold !”–NATHANIEL CORE, “What is the True Measure of the Alleged Appreciation of Gold?London, 1883.

| Repeated investigations made in England in recent years prove that only about 0.6 per cent of coin is used in settling the transactions of banks and bankers of that country; and the results of an inquiry instituted by the United States Controller of the Currency in 1881 showed that of all the receipts by 1,966 national banks in one day in that year (June 30th), 95 per cent were made up of forms of credit, exclusive of even circulating notes; while for New York city the percentage was 98o7. At all the banks the proportion of gold coin to the whole receipts was only •65 of 1 per cent.

The answer of Mr. R. Inglis Palgrave, an English economist of repute, who has recently published extensive memoranda on prices, to a question put to him by the British Gold and Silver Commission (1886), as to “how far the drop in prices is attributable to the alteration in the use of the gold standard,” is also worthy of note, and was as follows : “In my opinion it is only a small part of the drop in prices which is attributable to the appreciation of the standard.” The present and rapidly increasing indifference of the business public, alike in Europe and the United States, whose interest in this subject is mainly practical, is also significant, as indicating that the importance formerly conceded to the gold-scarcity theory has not been confirmed by experience.

It will be further relevant to this discussion to call attention here to the manner in which certain admitted facts touching the recent fall in prices have been misunderstood, and, more especially, have been perverted, with a view of sustaining this same theory and of creating exaggerated ideas respecting impending disasters, and the power of legislation to provide remedies. Thus, in illustration of the assumption that the quantity of gold in the world, available for use as money, mainly regulates prices, and that, prices having fallen by reason of a scarcity of gold, the ratio of debts to assets, or the burdens upon debtors, has been increased, Mr. Moreton Frewen, of England, has frequently in recent years made the following statement : Premising that the national debt of the United States was £600,000,000 sterling ($3,000,000,000) in 1866, and £220,000,000 ($1,100,000,000) in 1887,

he says:

“Six hundred millions sterling owing in 1866 represent 18,000,000 bales of cotton, or 25,000,000 tons of bar-iron. But at the prices of to-day, only £220,000,000 sterling is represented by some 26,000,000 bales of cotton, or 29,000,000 tons of bar-iron."

Therefore, the burden of the national debt of the United States has been increased, as a greater effort of labor, or an increased amount of the products of labor, is now necessary to liquidate it than when the purchasing power of gold had not been appreciated through its scarcity; and, as with public debts, so also with private debts, especially those in the nature of mortgages on land, or other productive fixed capital.

Now, in reply to this it is to be said, first, that the basis assumed for this comparison of prices, in the case of cotton, is entirely unfair and unnatural—the gold price of this commodity in the year 1866, owing to a scarcity occasioned by war, having been more than 250 per cent higher than the average prices in 1860 before the war; while the price of iron for that same year in the American markets was also inflated on even a gold basis; and, secondly, that no consideration is given, or allowance made in the above comparisons for the results of labor at the two periods of 1866 and 1887; not more, and probably much less, actual labor in 1886–87 having produced 6,513,000 bales of cotton in the United States than was required in 1860 to produce 3,800,000 bales ; * while in the case of iron the same amount of labor will produce in 1887 more than double the quantity, in the more valuable form of steel, than it could have produced in 1886. In short, if the debtor has got more to pay, he has more to pay with.

Again, it is a popular idea that the steadily increasing supply to the markets of the world during recent years of wheat, the product of low-priced labor from India—seriously affecting, through its competition, the prices and profits alike of the agriculturists of the United States and of Europe-has been in some way occasioned by the change in the relative values or purchasing powers of gold and silver, consequent on the “demonetization ” of the latter metal—although no one as yet has been able to trace with any degree of clearness any connection between the two facts—and that an imperative necessity exists for some speedy and international remedial legislation. To all entertaining this idea, the following summary of evidence, brought out by the British Gold and Silver Commission in the course of their investigations prosecuted during the present year (1887), is especially worthy of attention :

There was practically no trade or movement in wheat between Europe and India until two or three years after the opening of the Suez Canal, or until about 1873; in which year exportations were further encouraged by the removal of an Indian export duty on wheat of about 6 per cent. In June, 1881, and June, 1886, the prices of Cawnpore wbeat at Calcutta were at the same level, namely, 2:9 rupees per maund. The cost of Indian wheat in London in 1881 was 428. a quarter, and 31s. 6d. in 1886, or 10s. 6d. difference. In 1881 the rate of freight on wheat from India to London was 60s. per ton, and in 1886 308., a difference of 308. per ton, or 6s. 6d. per quarter. The decline in freights, therefore, accounts for 68. 6d. out of the 108. 6d. per quarter

The increase in the cotton product of the United States since 1860 has been due mainly to the increased use of fertilizers, better tillage, better conditions for the employment of labor. In the Brazos alluvial region of Texas, which ranks among the first of cotton-producing regions, the relative increase in cotton product and population between 1870 and 1880, according to the United States census, was 1.8 to 1. In what is termed the "oak-upland” regions of North Carolina, the product of cotton in 1880 had increased over that of 1870 in the ratio of 4.5 to 1, or this region in 1880 produced more cotton than the product of the entire State in either 1870 or 1860. “This remarkable result,” according to the special United States census report on cotton for 1880, “was due mainly to the introduction and general use of commercial fertilizers, which not only increase the crop, but hasten its maturity from two to three weeks, and so bring into the cotton belt a strip of plateau country whose elevation, of from 800 to 1,200 feet, had placed it just beyond the climatic range of the cotton-plant. This change is in no respect due to altered relations of labor."

+ See “First Report of the British Commission "-evidence of Henry Waterfield, C. B., Financial Secretary of the India Office, and representing the Government of India, pp. 125, 126.

difference between the prices of Indian wheat in London in 1881 and 1886, respectively, leaving 48. per quarter to be contributed by other agencies. Between 1879 and 1886 the charge for the railway transport of grain between Cawnpore and Calcutta (684 miles) was reduced to the extent of about 28. per quarter, which represented to the purchaser in Calcutta an equivalent reduction in the cost of Indian production, and in the absence of which the Calcutta and European prices would obviously have been correspondingly increased. A further reduction of 6d. per quarter" is probably owing to a decline, during the same period, in the price of the gunny-bags” in which the wheat is transported ; leaving 3s. 6d. per quarter, which may not unreasonably be referred to, and fully accounted for, by the extraordinary decline of more than 12s. per quarter, between the years 1880 and 1885, in the export price of American wheat ; which, as the largest factor in determining the world's surplus of this commodity, is also necessarily the largest factor in determining what shall be the price of this surplus in the world's market.

Evidence was also submitted to the British Trade Depression Commission in 1866, to the effect that the increase of the acreage under wheat in India “exactly agrees with the development of the Indian railways," and that “when more railways are made in India, a very much larger wheat production will immediately follow.”.

* On this subject, the following testimony was submitted to the British Commission on the Depression of Trade, 1886, by Mr. W.J. Harris, who is recognized as an authority in England on agricultural subjects :

“Our Indian Empire seems able to extend its corn-growing industry to almost any extent, and to produce more cheaply than any other country in the world. I am aware that Sir James Caird gave a somewhat different evidence on this question, but I think that neither Mr. Giffen nor Sir James Caird have taken sufficiently into account one or two things in their statistical computation. They both maintain that the population of India is too large, or is getting too large, for the means of production. They do not seem to remember that every unit of population in India consumes about a fifth part of what the unit of population in the United States does. It is a comparison between India and the United States. Both Sir James Caird and Mr. Giffen admit that the capabilities of the United States are very enormous, but they think that the capabilities of India are comparatively very small. I differ from them, and I will give my reasons. If we follow (on the maps of India) the course of the railways which have been made for some time, you will find that the acreage under wheat exactly agrees with the development of those railways; and it appears to me that when more railways are made in India, a very much larger wheat production will immediately follow. I have made several inquiries from the principal merchants who do business with India, and who have agents at many central points, and they all agree that the wheat production in India is not nearly developed yet. The population is not encroaching on the means of subsistence so much as the mere statistician would argue, because he does not take into account the habits of the people; and I believe that the United States population, in consequence of the habits of its people, is encroaching just as fast on their means of subsistence as are the people of India. There is a large acreage in India that is not fully cultivated with anything at the present time, and, where it is, it is very imperfectly cultivated, and the prices of produce are exceeding low in places remote from railway communication. Agriculture is very

The evidence, therefore, warrants the belief that the fall in recent years in the price of Indian wheat, and its consequent appearance as an important element of supply in European markets, is to be accounted for mainly, if not entirely, by changes in the conditions of its production and supply, and not by any changes in the relative values of gold and silver; and further, that if every measure for extending the monetary use of silver, which has been proposed, should be carried out to the fullest extent, it would produce no sensible influence in restraining the Indian ryot from competing with American and European agriculturists in the sale of wheat in the world's markets.



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give a brief history of the idea, and especially to explain the relation of Louis Agassiz to that theory. This is the more necessary, because there is a deep and wide-spread misunderstanding on this subject, and thus scant justice has been done our great naturalist, especially by the English and Germans; and also because this relation is an admirable illustration of an important principle in scientific philosophy.

Like all great ideas, we find the first germs of this in Greek philosophy, in the cosmic speculations of Thales and Pythagoras. Next (about 100 B. c.) we find it more clearly expressed by the Roman thinker, Lucretius, in his great philosopbic poem entitled “De Rerum Natura." After a dormancy of nearly eighteen centuries it next emerges with still more clearness in the theological speculations of Swedenborg and the philosophical speculations of Kant. All these we pass over with bare mention, because these thinkers approached the subject from the philosophic rather than the scientific side—in the metaphysical rather than the scientific spirit.

The first serious attempt at scientific presentation of the subject was by the celebrated naturalist, Lamarck, in a work entitled “Philosophie Zoologique," published in 1809. It is not necessary, in this rapid sketch, to give a full account of Lamarck's views. Suffice it to say that the essential idea of evolution, viz., the indefinite variability and the derivative origin of species, was insisted on with great learning and skill, and illustrated by many examples. With Lamarck, the factors of evolution or causes of change of organic forms were—1. Modification of organs in function and therefore in structure, by a rude; they have very little machinery. The system might be greatly improved, and the produce thereby increased.”—Third Report on the Depression of Trade, pp. 82, 83.

* From advance sheets of Professor Le Conte's work on “Evolution and its Relation to Religious Thought," in preparation by D. Appleton & Co.


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