IMPORTS AND EXPORTS OF GOLD AND SILVER, UNITED STATES Prior to 1821 the commercial movement of precious metals was not separately reported; nor were the exports and imports of silver correctly given separate from gold, until 1864. Further efforts to adjust the double standard. Ingham's report. CHAPTER III 1830 TO 1860 THE ratio existing during the period from 1820 to 1830, by consensus of opinion, undervalued gold. The only differences of opinion related to the proper ratio to be adopted and the correlated question whether gold or silver should be the standard. On May 4, 1830, Secretary Ingham, of the Treasury, in response to a resolution of the Senate of December 20, 1828, requiring him to "ascertain, with as much accuracy as possible, the proportional value of gold and silver in relation to each other; and to state such alterations in the gold coins of the United States as may be necessary to conform those coins to the silver coins, in their true relative value," presented a report upon the subject containing the most thorough and exhaustive treatment it had received up to that date. He insisted that the loss of gold by the country was by no means entirely due to the undervaluation in ratio. He adduced the fact that prior to 1821 the market value in the United States had not varied materially from the mint value, and contended that the introduction of bank paper had been the chief cause of the exportation of gold. He argued that the exportation of gold alone did not cause serious trouble, but that actual distress ensued when silver also went abroad, leaving the country inadequately supplied. He set forth with great force the futility of endeavoring to maintain a bimetallic standard, and urged the adoption of a single standard, and that silver. He favored silver because contracts in the country had been for many years based upon the silver dollar, and also because no exact adjustment of the relation of the two metals could be maintained with any degree of permanence, and silver could be retained at home by reducing the mint value of gold. The country could not possibly get along without silver, whereas it could without gold by the use of sound bank currency. As to the ratio, he suggested that, since the market ratio appeared to be about 15.8 to 1, and it was desirable under his plan to have gold at a slight premium, the coinage ratio should be 15.625 to 1. Secretary Ingham addressed many persons familiar with the subject, for information, and he thus obtained much valuable material which was published with his report.1 views. Gallatin, who had been Secretary of the Treasury Gallatin's under Jefferson, contributed a lengthy letter and statistical information. He favored the adoption of the French bimetallic system, ratio 15 to 1, with coins .900 fine. He criticised the English single gold standard, with its "adulterated silver currency," but not with his usual perspicacity. His general conclusion was that the bimetallic standard should be adopted for the reason that the fluctuations of gold and silver would be less than that of one metal only. If a single standard were selected, silver was preferable to gold because it was then the existing standard metal, was more abundant, requiring a greater premium before it could be exported, and was the only means of suppressing small notes, the worst form of paper currency. Very valuable statistical and other data relative to exchange, premium on gold, coins, etc., covering many years, were furnished by Samuel Moore, Director of the 1 Printed in full in International Monetary Conference, 1878, p. 558. ་ and White reports. Mint, and by John White, Cashier of the Bank of the The views of Alexander Baring, the famous banker Ingham's report unquestionably influenced many of the leading men in Congress. To counteract the tendency toward the single standard Senator Sanford of New York, in December, 1830, reported a bill for the continuation of the double standard at the ratio of 15.9 to 1, altering the weight of the gold coins only. The The Sanford bill was ably supported in the committee's report1 which formed the basis of two reports to the House of Representatives in 1831,2 one on silver and the other on gold, by Representative C. P. White, also of New York. The latter made two further reports in March and June, 1832.3 Together, these five reports constitute an encyclopedia of the then existing information on the subject. The House Committee opposed the double standard because of "the impossibility of maintaining both metals in concurrent, simultaneous, or promiscuous circulation," urged that the single standard is the nearest approach to stability precluding the need of further legislation with each change in relative commercial value, and asserted that if a metallic circulation was desired, notes of ten dollars and under must be prohibited. White would not admit, as Sanford claimed, that injurious consequences would ensue if one of the metals 1 Senate Reports, 21st Congress, 2d Sess., No. 3. 2 House Reports, 21st Congress, 2d Sess. 8 House Reports, 22d Congress, 1st Sess., Nos. 278, 496. silver standard. were rejected. He recommended the adoption of the White for ratio of 15.625 to 1 and .900 as the standard of fineness. As to this ratio, he regarded it the utmost limit to which the value of gold could be raised if silver was to be retained, and finally he stated that "the standard ought to be legally and exclusively, as it is practically, regulated by silver." The influence which the large volume of small notes exercised in driving out coins was fully appreciated in the House Committee reports. The discussion proceeded without action for two years longer. In February, 1834, White again reported upon the subject, repeating his former bill and recommendations.1 In May the banks of New York, under the lead of Gallatin, then president of one of them, sent a memorial to Congress asking for the enactment of a law to coin gold at the rate of 23.76 grains of pure and 25.92 grains standard metal to the dollar.2 This would have continued the fineness of the coin at .916 (or eleventwelfths) and, since the silver dollar remained unchanged, would have resulted in a ratio of 15.625 to 1. They also asked that the silver dollars of the Latin-American states and the five-franc pieces of France be made legal tender as well as the Spanish dollars, at their proper mint values. These coins had in fact become the chief elements in the country's specie circulation, and some action was necessary to provide a sufficient volume of legal tender money. standard. Later in the session, when the desire for action be- White for came pressing (and only one week before the act of gold 1834 actually passed), White completely changed his position and reported a bill which practically favored the gold instead of the silver standard, fixing a ratio of 1 House Reports, 23d Congress. 2 International Monetary Conference, 1878, p. 679. |