Loan Bill. SPEECH OF HON. JOHN LYNCH, or MAINE, March 16, 1866. The House having under considerationthe bill to amend an notentitled “An act to provide waysand means to support the Government, ”approvedMarch 3, 1865 Mr. LYNCH said: mr. Speaker: The bill under consideration extends the authority of the SecyTreasury so far as to allow him to retire the U.S. legal tender notes, which now constitute so large a part of the currency of the country, and which are the only “lawful money in circulation, and to substitute therefor the bonds of the Government bearing interest in coin. The bill also provides that the bonds which may be disposed of elsewhere than in the U.S. may be made payable in the currency or coin of the country where they are a made payable. These are briefl the powers which this bill proposes to con'er upon the Secretary. Before considering their nature or the question of their necessity, let us see what powers that officer already has under existing aivs. The act of June 30, 1864, authorizes the SecyTreasury“ To redeem and cause to booancelodanddestroyed anyTreasurynotesor U.S.notesherototoro issued under authority of previousactsof Congress and to substitutein lieu thereofon equal amount 0 Treasury notes or of other U.S.notes." Under this act the Secretary has the power to convert every dollar of the legal tender cir culation into 7 30 Treasury notes or into compound interest notes. Further, the act of March 8, 1865, provulcs that “any Treasury notes or other obligations bearing interest issued under any act of conss may, at the discretion of the SecyTreasury and with the consent of the older, be converted into any descrition of bonds authorized by this act.” This authority covers nearly half the entire indebtedness of the Government. The Secretary, under it, has the power to fund the entire issue of 7 30 Treasury notes, amounting to $830,000,000; the 3 year compound interest notes, amounting to $180,000,000; the certificates of indebtedness, amounting to $60,000,000; the one and 2 year 5%. notes, amounting to $8, 500,000, and the temporary loan, bearing four, 5 and 6%. interest, amounting to $116,000,000, making a total of $1, 103,000,000, which existing laws authorize the SecyTreasury to fund at his own discretion. It should be understood, however, and it is due to the able officer at the head of the Treasury Dept to have it well and fairly under stood, that the authority conferred by the act of March 3, 1865, is, after all, limited to an extent which seriously interferes with the process of funding thereby authorized. The necessity of funding a large portion of the floating debt of the Government rs, I think, universally admitted, and the SecyTreasury, therefore, should be clothed with explicit power to make this change in the character of the debt in the safest, least expensive, and most ructicable manner. In dorn this, however, would not have the distinction lost sight of which so clearly exists, and which is so universally recognized between the bonds, Treasury notes, and other interest bearing obligations of the Government on the one hand, and the U.S. legal tender notes on the other. These latter are the lawful currency of the country; they are not mere promises to pay money, but money itself “lawful money, ” capable of paying debts, and answering all the uses of money in making exchanges wrthia the country. The interest bearing portion of the public debt is ayable at certain dates, and must be provided2 for at maturity; The SecyTreasury is the guardian of the public credit. On him devolves the duty of providing for the payment of these inaturin obligations. He lhas the responsibility, an should have power commensurate therewith. The limitation with reference to funding, which I have alluded to as existing in the act of March 3, 1866, consists in the fact that the Secretary can only fund Government obligations in one way. In other words, he has no power to anticipate means by the sale of bonds and to appl the same to the unding of the floating debt. 'c can fund only so fast as an exchange of one class of indebtedness for another can be effected. He can hold out no inducement for a speedy conversion of such obligations, and he is thereby ham ered and embar rassed in his operations. Iphope, therefore, that the law which now gives this power under limitations may be so amended as to confer it upon the SecyTreasury without restriction. Whether'it is or is not best to continue, so far as it can be done, that portion of the debt bearing interest in currency in its present form, there y preventing it from leaving the country and hastening the day when the Government may be able to redeem its circulating notes in specie by reducing the amount of coin it will be obliged to pay out for interest, are questions to be settled y the head of the Treasury; and I am ready to vote for the bill reported by the committee, amended only so as to prevent the funding of non-interest bear in into interest bearing obligations. at I am, as I have already intimated, opposed to conferring any power upon the SecyTreasury to contract the volume of the national greenback legal “tender currency. The exercise of such a power is not necessary to facilitate the funding of the interest bearing debt; indeed, it is acknowledged that it would retard if not defeat that most desirable object. It is said that the Secretary “could not if he would and would not if he could” contract the currency, but that it is necessary to hold this power suspended in ierrorem over the business of the country in order to prevent speculation. In answer I have only to say that if the people of the country are not cometent to manage their business affairs they will not be benefited by any governmental guardianship which may be ilaced over them. It should be ornc in mind that $182,000,000 of the U.S. currency afloat, about 1/3rd of the total amount in circulation, is in the compound interest notes, which all agree should 1st be retired. The Secretary has not only the authority but the power, if he deems it prudent to exercise it, to call these in at any time. They never pass for the face value and interest, and the Government can at any time exchange its bonds for them. And yet the most determined advocate for contraction does not preterid that it would be prudent to withdraw them all from circulation in less than about 2 years. I have heard no one who favors contraction intimate that it would be prudent to contract more than $100,000,000 peryear. Why should we confer on we know not what SecyTreasury a power and authority which would extend beyond 2 years from this time? Congress meets twice within that period, and if it is found that the experiment rs a safe one, and that it is prudentto continue the contraction of the currency beyond the amount of the compound interest notes, the authority can be given. We can confer additional authority by subsequent legislation if it is found necessary, but are we quite sure that we can withdraw it when once conferred? May we not find it as hard to re I a had low as it is to enact a 0d one? how many men on this side of tchouse would consent to confer this vast power, which subjects the entire business interests of the country to the will or caprice of one man, providing it was known that the able and upright officer now at the head of the Treasury Dept would not hold his position for 60 days, but would give place to some unknown successor? Can any man say that such a contingency may not happen? It is said that it is necessary to contract this currency because it is inflated, and that we can only return to specie payments by contracting. I believe it is capable of being demonstrated that the currency is not inflated, not in excess of the requirements of the country, and therefore does not need contraction, and that the amount of currency afloat has very little influence either upon the price of gold or the price of merchandise; in other words, that in orderto reduce prices, either of gold or merchandise, and to return to specie payments it is not necessary to contract the currency. In support of this proposition I will present a few p arn statistics based upon the financial history of the past 4 years and upon the actual wealth and oulation of the country. The necessities o the Government which caused the issue of a large amount of aper money undoubtedly did to a considerable extent during the war advance the price of gold. But the increasing issue of paper money by the Government depended entire upon the success of our armies in the fie d, and as their final success seemed speedy or remote, so the necessity for the issue of more promises to pay diminished or increased, and the value set upon such obligations depended entirely upon the degree of confidence which the people felt in the stability of the Government. Now, however, confidence being entirely restored, the only question which can affect the currency is whether the quantity in circulation is equal to or in excess of the business wants of the country. If it be shown that it is not in excess, then certainly no reason exists for its contraction;. compoun if it can be shown that it is the safest and best paper currency ever put in circulation, that is another argument against its contraction; and if it be shown that e population and wealth of the nation is increasing so rapidly that in less than 15 years the hmount of currency pero ita will be only 1/2 what it now is, then t rat is another reason why we should hesi State before we agree upon a policy for annihilating a currency which every day’s exerience establishes more and more firm y in confidence of the people. 4; Let us examine 1st the relation which thb amount of gold has held to the amount of carrency in circulation. The amount afloat on the 1st of July, 1864, when the price of gold was at its highest point 260 to 280 was, in clusive of State bank circulation and exclusive of compound interest notes, according to the books of the Treasury Dept, $577,579,800. On the 1st day of November, 1865,ono year and 4 months later, with the price of gold down to 145, the currency had increased to $704,218,038, or a net increase of $127,000,000; while at the present time, with gold in the vicinisly of 130, the currency, exclusive of interest notes, is equal to $725,000,000. Thus it is lain that if ilie price of gold depended upon t re inflation or contraction of the currency, then it ought, taking the price on the 1st ofJuly, 1864, as a basis, to be now over 300%; and if gold has declined from 180 to 30%. premium under an actual and considerable increae of the currency, what should prevent it from going to within the present year, thereby enabling thir Government itself to resume specie payments, and as a consequence carryrng with it in due time a similar resumption by the banks of the country 'I In addition to the many advan s and great superiority possessed by the lega tender currency as a circulating medium, there is another advantage accruing to the Government from its use, and to this point I wish to call the attention of the Gentfrom Ohio, [Mr. GARFIELD] who thinks the Government should withdraw its circulation and leave the entire currency of the country in the hands of the banks. So long as the Government issues a currency of this character it can control the matter of ecie payments, and the danger which atten s it when left entirely in the control of the banks is removed. If the banks control the entire circulation we can never rely upon the permanency of specia payments; they will inevitably consult their own interests, and they will suspend whenever dangers threaten them, no matter what laws may be passed regulating the subject, for the laws of the country must conform to the laws of trade. Give the banks the entire circulation and they might lau h at an attempt to close them up on account 0' a suspension; they are “masters of the situation; the country cannot get on without a currency., I But the permanency ofs cie payments may be greatly increased if the government stands ready, anchored in the confidence of the people, to pay its paper dollar for dollar in old, and this simple knowledge on the part of the people that the greenback passing through their hands day after da is the positive equiv alent of a dollar in gol in the Treasury will make that circulation one of the greatest blessings which could be conferred upon the people. This sentiment is even now rapid] growing. Let us once reach a specie stunard for the greenbacks of the country and the people will never consent to have withdrawn from circulation a currency so well adapted to all their wants and so well grounded in the 1st principles of security and confidence. The practicability of an earleiesumptron OE specie payments and the road reto involves many serious considerations. Ithaa been and is strongly urged that there isno way of reaching such a result except through the policy of contraction; that to make money scarce and dear you will approximate a specie tandard more certainly than in any other way. I question the correctness of this theory. As has already been shown, gold has declined from 280 to 130%. under an absolute increase of the currency. Will some one give me a sound reasoning why the decline should stop at this particular point? Will notthe same reasons which have torced it from its highest altitude to its present point operate to drive it still lower? lf we should double our imports tomorrow would not the price of gold advance, even though at the same time we withdraw 100 millions of greenbacks from cir culation? If, on the contrary, we should reduce our imports and double our exports, would not the price of gold decline Without contracting our currency a single dollar“! Is there any more certain way of aying our debt abroad or of keeping our goldiat home than by increasing our exorts? And is there any more certain way 0 increasing our exports than by stimulating productions? And is there any more certain way of stimulating production than by employing this very circulation, the capital of the country, in developing its vast resources of every c aracter, in cheap ening the price of food by increasing the production 0 food in inducin immigration by opening new and vast fields or development, and in adding to the production of the country so ra idl that a few years will give us a mo nopo yo the leading agricultural staples, bringing the whole world to our doors to buy what we have to sell, and keeping the balance oftrade as constantly in our favor in the future as it has so uniformly been in favor of England in the past? Instead of disturbing the entire business interests of the country by an attempt to compress the currency into channels in which it was employed prior to its increase, would it not be more natural, much easier, and far safer to enlarge those channels to suit its present volume? The business interests of the country are fast accommodating themselves to its new financial condition; already are matters so settled that contraction can scarcely be talked of without advancing the rate of interest one or 2%, and I ask gentlemen which is the true policy for the development of this country, to make money dear orto cheapen it? Which most stimulates the employment of labor and the development of capital, and thus adds most to the wealth of the country, money plenty or money scarce?Mr. Speaker, in r rd to our finances, we have received and believed in the old and long established precedents of the nations of Europe. Because it took GreatBritain many years to return to specie payments after an exhausting war, the theor has been acce ted almost without iluestion that we cannot ootherwise. Sir, the ox eriences of the country for the last 5 years have exploded many false theories and falsified many sangine predictions. It was ggsitively asserted y our forei fees that the nth could not be conquere; that it never yet had been that a free people of the numbers, resources, and territory of the southern people were defeated and compelled to submit to the will of a conqueror; that we could not raise armies sufficient for the work; that we had no money of our own and could borrow none in Europe; that the armies. even if raised, would, upon a return to civil life, so disorganize society that Government would he upheaved and civil order destroyed. Well, sir, we have seen the result of all these predictions; we have astonished the civilized world by setting at naught the most profound theories of these modern sages; we have over turned the accepted notions and ideas of past centuries, and in their stead we have hewn out our own destiny in our own way, until we stand on ground where we maysafely bid defiance to the assaults of the combined physical and moral powers of Euro e. In view of allpthese facts, so grandly and imperishably carved in our history, why should we ollow the ideas of Europe in regard to our financial any more than we did in re. rd to our militaryadministration? Because the London Times raises the cry and our own croakers echo it, that “we must have a financial crisis" in assing from a paper to a specie circulation, is it necessary for us to precipitate one upon the country in order to verify the predictions of these rophets of evil? Eu and said, on cannot carry on a war without a nropean oan, and that you cannot get. We spurned her prediction and appealed to our own people; the re house was so mighty that even England and all other enlightened nations of Europe made haste to join the throng that ured their money into our coffers eager to uy our bonds and take our loans upon our own terms. Shall we now say that we cannot return to specie pay ments because England under circumstances 0 an entirely different character did not do so for many years after a return of peace? such a reason it seems to me is not worthy the name of an argument. The laws of trade and the restoration of confidence are bringing us steadily and surely to a resumption of specie payments; any attempt to force a resumption y legislation will defeat the object; that confidence upon which a permanent resumption of specie payments must rest will neither be engendered uor strengthened by legislative tinkering. The last Congress tried an experiment in this direction by passing a law to force down the price of gel; the result was a rapid advance and the immediate repeal of the aw. It is almost universally admitted that the return to specie payments must he gradual. Suppose, then, that the Government of the U.S. takes the initiative; not by a contraction of the currency, but by announ cing, at as early 11d.ay as is practicable that its legal tender currency will be redeemed in gold on presentation at the Treasury, and then, to aid the banks in following its lead, let the national banks be allowed to redeem in the legal tender notes thus put on par with gold by the Government. With thesis of redemption thus broadened it could not belong before the business and the money of the country rested as firmly upon a specie basis as ever. I do not assert either the necessity or prac ticability of doing this immediately. The bar vests of the present year are necessary to as sure us that the production of the country has been resumed with greater vigor than over; with the volume of our exports daily increasing, they must be greatly augmented a year hence; with the flow of specie from the Pacific steadily gaining i with the national debt securely at rest in its (present position, under 0 it? no increase, on with a material reduction 0 taxation already rendered possible by the condition of the country’s finances, I can see no good reason wh, under the present able management of the 1‘ Treasury, the Government may not before all the Treasury notes now out standing inature if not within a year from this time stand readyto redeem its own cir culation in gold. It may be said, in objection to this, that neither the Government nor the banks can resume specie payments because of the insufli ciency of gold in the country. I answer that specie payments do not and never have, except to a comparatively limited degree, rested upon the amount of specie in the country; in other words, specie payments have been only a pleasant illusion which was immediately dispe led whenever a crisis occurred which disturbed public confidence; people then has tened to demand specie for their bank notes, and just then when it was wanted, and because it was wanted, it could not be had; the banks suspended, fear took the place of confidence, and the gold dollar was sold at a premium. The great underl ng principle ofspecie payments is public confionce; upon that rests the question far more than n on an ability to pay specie on demand. An where does a greater degree of confidence exist than among our own people that the Government has the power, the means, and the determination to protect the public credit, and to redeem and pay off its liabilities? Does anyone suppose that if the greenbacks were daily redeemed by the Government in gold that there would be a run upon the Treasur? To say nothing of the impossibility of Withdrawin an considerable amount from the circulation or such a purpose, the very fact that the paper dollar of the Government was worth a dial ar in gold at the Treasury would, by the laws of trade, keep them moving as the circulating medium, undiverted from their proper channels. In support of this theory of specie payments, and the foundation upon which it has really rested in times past, I will compare the amount of currency alloat and the amount of specie in the count at 5 different periods since 1830. We had in Specie. (Emulation. Thus it will be seen that at no time during this period, except in 1843, did the banks have specieenough to redeem but little over 1/3rd of their circulation. It should also be borne in mind that the banks having the least specie had the largest circulation, while the banks which held the largest amount of specie had little cir culation. it would undoubtedly be within the truth to say that $150,000,000 of the circulation of 1860 rested upon a specie basis of less than $30,000,000. this proves conclusively that the paper circulation of the country never rested upon an actual “ specie basis, ” but on the confidence of the community; and whenever this was shaken, the whole paper fabric fell. The currency of the country never rested on so solid a foundation and was never so strong in the confidence of the country, as today. It is assumed that because we have more than 3 times tin amount of aper in circulation that we had in 1860, ( 207,000,000,) therefore all over that amount is in excess of the business wants of the country, and tendsto unsettle values and inflate prices. I think the fallacy of this theory is in assuming that we had in 1860 all the currency in circuation that could be profitably used in the business of the country. We had, undoubtedly, all that the banking capital of the country at that time warranted, and much more, as has been shown, than could be redeemed in the promised specie. But the fact that we are now usin 4 times the amount in the legitimate business of the country, and with less speculation in merchan disethan at times when our circulation was one quarter the amount, is conclusive that we did not then have all we required and could profitably use. The fact is, the business of the country is only limited by the amount of capital available to transact it. The banks, with their $300,000,000 of circulation, have supplied the old business, while the disbursements of the Government have gone into 100s of new channels, have reached new classes, and have placed the means of doing business within the reach of more men than possessed them before. It is assumed that the redundant currency is the cause of the high prices of merchandise, and thata reduction of the currency will bring down prices and also enable us to return to specie payments. But the fact is that gold has fallen from 280 to 130 while the currency has been increased, and merchandise which, accordin to this theory, should have both advan with the increase of the currency and fallen with the decline in old, has upset both theories by following gold down for a time, and almost immediately returning to the point at which it stood when old was at its big est, then falling again untiT it approximates old values. Is it strange that merchandise, the product of labor, should command high prices in view of the enormous decrease in the productive industry of the country for the last 4 years. In nearly 1/2 of the country, the entire South the population was during the war almost wholly changed from producers to consumers and destro ers; and in the North more than 2 and hnl million men, or more than 12% of its population were absolutely with rawn from the work of production and added to the army of consumers; and in addition there has been to an extent very great, though incalculable, a diminution of the productive industry of those who have not been taken from their plows, their looms, and their anvils, caused by the suspense, anxiety, and excitement of the civilWar. In these 4 years the surplus production of the country has been exhauste, and the current production has not supplied the current demand. It is neither a redundant eur rency nor excessive speculation that has kept prices at so high a standard. Look at the present condition of trade in the great markets of the country, merchandise and the premium on gold both ra idly declining, not only without contraction, lint with a positive increase of the currency. What is the true cause of this decline which all unite in saying is not the result of a sudden fluctuation, but romises to be permanent? Is it not simpl the fact that the supply is increasing and the emand is talling 011'? The great army of consumers is being added to the class of producers, and prices of merchandise and food must always be pri marily and chiefly subject to the great law of supply and demand. It can scarcely be doubted that prices would have been still lower and that domestic manufacture would have supplied much of the merchandise imported from abroad had not the fear of a “tight money market” withheld and diverted mifiions from the channels of productive indust to swell the bank deposits in the great financial centers of the country, to be loaned on call, and kept within reach against the day when contraction should give it more power and value. Men would not convert their money into cloth and iron and ships and railroads when all these products of labor were to be cheapened, while the money had only to be kept on hand to realize an advance in price. Another fact which goes to show that high prices have not been caused mainly by the increase of the currenc is that lands have advanced no more in the ast. 5 years than in the 5 'ears precedin, showing that the advance o irices have c ieliy affected the prod ucts of la Mr. In connection with this matter of contraction I wish to press another point, and it is this: that whenever you reduce the currency or tighten the money market you 1st strike at the price of labor. Labor is the 1st element in productive industry that is affected by it. If money becomes scarce and dear the for the products of industry falls off. The manufacturer not only reduces the wages of his operatives, but he reduces the amount of his productions by putting his employees upon half time. In this way the production is checked until the surplus is exhausted and the demand is again equal to the supply. Instead of being diffused over the country, seeking new channels of employment, and adding to the vigor of' the development of the resources of the country, our capital will remain locked up in the vaults of the commercial centers, sensitive to the slightest influence, and in constant fear, and he uncertainty as to the policy which may iron time to time be adopted by the head of emand, the Treasury. Is it not for safer and much more legitimate to absorb the excess of.pro duction by the development of new resources; to absorb also the excess of currency, if there be any, in new channels of employment; to give the currency the freest scope of circulation by creating and increasing the demand for labor? Wealth creates wealth, and it is the strongest evidence of financial statesmanship and business talent if that wealth is so applies as to add to the pros crity of the country. Our currency then fin s its proper use in developing our vast resources; in buildin new railroads, canals, and factories; in refacing our lost shiping, and in opening up the vast mineral wea th of the nation; and in rebuilding and furnishing the sinews of trade to the whole southern country. Let us now see how the present circulation of the country will be affected by its natural increase in population. The total amount of currency in circulation October 31, 1865, was, according to the report of the SecyTreasury, (exclusive of compound interest notes,) $704, 218 038 or about $19 32 percapita for the people o the U.S. This amount won (1be reduced by our increasing population in the following ratio: in percapita. The ratio of circulation to the property of the country, estimating the increase at the same ratio as from 1850 to 1860, would be as follows: in%. 1865.:ibou.t.. 1870, “. pg. 1;. 1900::3. The national bank circulation of the country October 1, 1865, was $171, 321, 903, distributed among the several sections of the country, as follows: SecTTona. Population. piggy '1'“ NewEngland. NewYorklt. Pennsylvania, and NewJersey. 7, Illiln onisri.saInsd, iaMnaic.hIipgwaan., Minnesota, Ohio an Wisconsin.7.881.0m 37,028, 888 DeMlaawrya laren.d. Missouri., and DistCol. 3, 212,041 Louisiana, Tennessee, Virginia and WestVirginia Thus it is seen that the circulation of the country is ver unequally distributed. It is chicficentere in NewEngland and on the sea boar, while the western and southern States are almost bare. Assuming the same ratio of distribution for the whole circulation of the country, the amount percapita for the U.S. averaing but $10 32, yet NewEngland would have the very great disproportion of $84 percapita. And what is strikingly significant on this point is, that her business is in a most healthy condition; her capital is legitimately employed, and not for speculative purposes. France has a circulating medium of about $30 and Great Gritain of $25 percapita, and yet we are told that $19 32 will ruin the people of a country which has the broadest field under the sun for the employment of capital. We want the use of the currency now in circulation, than which there never was better or safer, to create new wealth; we want every 100,000 dollars of greenbacks to be the implement and agent for extracting a million of the precious minerals from ourine untains: we want this currency, the representative of the capital of the nation, to construct and equip 3 great lines of railroad to the Pacific; we want it to enable the fertile States and Terri 469 5.962.850 I 85 tories of the West to develop their power in the productive industry of the country; we want it to construct new lines of communication whereby we may cheapen transportation from the distant States and give our producers greater benefits in foreign markets; in a word, we want it because the present and future interests and the rapid development of the country demand and need it. I will refer to but one more point on this branch of the subject. It is assumed by many that we must have a financial revulsion because such has always been the case after an unusual abundance of currency. People who assume this lose sight of the fact that an abun dant supply of paper money usually indicates a large indebtedness of the people, and that the crash comes when they are obliged to return their borrowed capital. The present abun dance of aper money results from the indebt edness o the Government to the ice le; the people being comparatively out oflde t, there will be no crash. Comparisons of our present condition with the financial revulsions of 1837 and 1857 fail entirely, because there is no similarity of circumstances; the currency at those periods was more vitiated than inflated' there was no security for it; the people were largely in debt. In addition to tecurrency afloat, which was then the representative of the in debtedness of the people, there was also afloat an enormous amount of notes debt which the people owed to one another and to the banks. The crash came when people found that no one had any money to pay 'jifih; the currency was not based upon the a.y of a united people represented by its Government to ay, but upon the ability of individuals to re eem the promises they had made to each other. Now, the Government, representin the entire people, tpledges the faith of that whole people to poly is national indebtedness. very dol at of paper money now in circulation, excepttheinsi nificant amount represented by State bank circuation, is secured by a mort gage on the whole property of the country. It is a secured circulation, and really rests upon a specie basis, although not immediately convert i le into specie except ata discount. If the specie is wanted it can be had and no man suffrage, for no holder ever received it as the equiv alent of specie, but at a larger discount than he now makes in converting it into the required coin. The Gentfrom Pennsylvania, [Mr. SCOFELD, ]who was troubled because he could not obtain. specie for his greenbacks at the Treasury, would have found no difficulty in doing so without applying to the Treasury, if he were content to accept the amount which they costhim. The greenbacks rest ona specie basis, because they can be converted into onds, the principal and interest of which are payable in com., The terrible evils, present and prospective, of this “ irredeemable, ” inconvertible paper currency are purely imaginary. The people neither see, feel, nor believe in them and they  will never consent to an increase of their taxes to the amount of $27,000,000 perannum for the purpose of allowing the bankers of the country a monopoly of the circulation. There is another reason why I am opposed to retiring any of this currency, which is, that we want it for suppl in the southern States. That matter was allu ed to by the Gentfrom Ohio, [Mr. GAui ‘iizi.n, ] in answer to the inquiry of the Gentfrom Iowa, [Mr. PRlCE, ] whether currency had not been increasing while gold had been decreasing in value. The Gentfrom Ohio answered “that 600 millions of confederate currency had collapsed in a (lay, and the vacuum had to be filled; so that while our currency had actually increased it had di minislied relatively, that is, in proportion to the business of the country.” Now, unless the vacuum has been filled, which no one would pretend, this simple statement of the gentleman retty effectually disposes of his argument in favor of contraction. his whole southern country is to be rebuilt, and with capital drawn from the North, unless a contraction of our money market drives her people to Europe to borrow. The money will be oaned upon mortgages, and repaid by the annual crops of the country and by its developed wealth. Whether this capital shall be British gold or U.S. greeti backs, depends upon the state of our money market. If we give them the paper money of the country we make every man who has a dollar of it in his pocket interested to that extent in the Government, and in sustaining its credit. Ifwe drive them to Europe by our inability to supply them, we alienate them from us, and allow them to identify their interests with those of our euemies. Every day’s experience goes to prove that our true financial policy is to go on and provide for the maturing obligations of the Government, without contracting or disturbing the currency of the country, which is the life blood of its commerce. Let it alone and it will flow where it is wanted, and find ample field for employment. Let us confer no authority upon the Secretary to contract this currency; its contraction should neither be threatened by the Government nor apprehended by the people.