130.0





The Record and Guide.





December 37, 1884





car to rival the speed of a locomotive. As a nation we are in
danger of committing a similar folly and go ahead with this
preposterous Nicaraguan scheme.





Oui* Prophetic Department.

Mr. Hopeful—It seems to rae that the prevailing view of things
is altogether too gloomy. Everybody one meets is in the dumps.
Inquire of anyone in any business and you will find that the com¬
ing year is set down as promising more distress than any year we
have had since the panic of 1873. Even your forecasts. Sir Oracle,
are tinged witli melancholy.

SiB Oracle—Well, I confess to being something of a pessimist so
far as the near future is concerned ; not because matters are really
so desperate, but on account of the general lack of comprehension
of the cause of the trouble and the obliviousness of the government
and financial authorities as to the proper means of bringing about
a better state of affairs.

Mr. Hopeful—It is not natural for the average man with health¬
ful blood in his veins to be without hope. Americans, especially,
are natural bulls. Now, whatever the natural advantages there
may be in the situation will be dwelt upon by everyone in busi¬
ness. "Hope springs eternal in the human breast," On looking
:iround us what do we see? To begin with, the most abundant
crops ever grown on this planet. Wheat goes begging, corn is
within a few cents of the lowest price ever known. Oats and the
other small grain were never so plentiful. Cheap corn is going to
give us by and by more hogs and lard than we can consume.
Meat, for the first time in many years, is actually being reduced ip
price. Then the machinery for supplying all human wants in the
way of raiment was never so efficient. Now, with these general
conditions I cannot believe that the world is going to Buffer.
Surely, it is not scarcity and high prices, which in the long run are
a benefit to mankind.

Sir 0.—You are quite right in supposing that good crops and
cheap production are in the long run a good thing, but certainly
the course of prices for the last four years on the downward track
has impoverished the rich and brought suffering to the poor. Pro¬
ducing on a falling market necessarily causes lOris to all who grow,
manufacture or sell. With you I am inclined to believe that early
next year there will certainly be a better feeling in the stock mar¬
ket. But I see no hopeful sign in the general trade of the country ;
the shrinkage iu prices must go on. A good summary of the sit¬
uation is contained in the following extract from a recent circular
of John A. Davis & Co., every word of which is true :

The purchasing power of money, as applied to breadstuffs, bas increased
to sucb an extent as co throw the ordinary relations of trade out of geir.
The farmer gets but httle more than half as much for a bushel of wheat
as he got a year ago. It is clear tbat be cannot pay as much for labor, for
freights, for groceries, (or luxuries as he paid a year ago. He can bring
down tbe price of what be buys most effectually by going without it.
Going without on a large scale reduces the demand; supply presses and
prices fall. This Is tbe nature of the great readjustment in progress,
Tbe purchasing power of money has risen rapidly on breadstuffs. It is
rising slowly on everything else, and the movement will continue until
equilibrium has been restored. The price of anthracite coal must fall;
the wages of labor must be lowered in the mill, at the workshop and on
the farm. Rents must be reduced to meet lessened incomes; lower rents
will bring a fall in real estate. Railroad freights must be lowered; divi¬
dends must be cub down and capital must be satisfied with smaller returns
on investments. Just wbenand where tbe balance will be restored is not
clear, but we fear tbe year 1885 will not see the eud.

The significance of the above is the admission that the prime
cause of the depression is the increased purchasing power of
money. The financial and commercial worlds have agreed that sil¬
ver must be discarded as a money metal and that gold, which is
diminishing in quantity, shall bejthe aole measure of value. This
augments the purchasing power of this one metal and hence the
distress in trade over the whole surface of the planet. This is a
splendid thing for those who control the gold or are in possession
of all forms of debt, government, corporate and individual, for they
must be paid in a metal which has immensely increased in value
since the debts were contracted. Yet nearly every daily and finan¬
cial paper in the East practically upholds this gold mono-metallism,
which is the cause of nearly all our woes, and never tire of ringing
the changes upon the wickedness of coining or using silver. Nearly
all these papers have been half ruined by the shrinkage in prices,
which extends to their own issues and their advertising columns,
yet the howl against silver is kept up unceasingly. What dis¬
heartens me is the utter incapacity to appreciate the prima cause
of our troubles by the classes most injuriously affected by it, which
includes every business man, producer, debtor and laborer.

Mr. Hopeful—But surely low prices are not bad things in them¬
selves? Does it not teach every one the lesson of economy and
prepare business for a new departure because of the decreased cost
of production?

Sir 0.—Well, we may console ourselves in that way perhaps, but
you have read the history of prices in vain if you have not found out
that the _bulk of the race ia always happier when prigee are ad¬





vancing than when they are declining. In the one case the wheels
of commerce are kept in motion, in the other they aie checked or
stopped. Show me a nation where wages are low and prices cheap
and it will prove to he a backward one, lagging in the rear of civil¬
ization, but a well-paid laboring class and high prices is an assur¬
ance of prosperity and a superior civilizatiou.

Mr, Hopeful—What other discouragements do you experience ?

Sir 0.—Well, look at this matter of our commercial treaties.
Their object is to extend our commerce and open new markets for
our surplus goods. A few selfish interests object and the negotia¬
tions come to a standstill. The very representatives of our com¬
merce in New York are the most bitterly opposed to anything that
will give us foreign'markets or create a demand for new ships.
We are without a navy, and the|Senate justly thinks that new
cruisers should be built and that some guns should be constructed
for the defence of our seaports ; but a Democratic House objects,
and, so far as the press is concerned, it seems to endorse the do-
nothing policy of the Representatives. Yet any tenth-rate naval
power could inflict damage upon us of flfty times the pecuniary
value of the cniisers proposed. Public works of all kinds are needed
for the defence of the nation and the improvement of its harbors
and waterways and incidentally to employ labor now in distress.
Yet where is the popular demand to put a stop to our preposterous
debt-paying policy and the using of Lhe money so wasted in pro¬
ductive outlays for needed improvements ?   YeS, I confess to being

discouraged.

—-------•----------

The House of Representatives has passed a bill making the
head of the Agricultural Bureau a cabinet officer. This is in
response to a demand from the South-and West. Ths Eastern
press object, but it is hard to see upon what ground. Indeed
there is very little reason iu their arguments, the proposed new
department being rather an object of ridicule. But there does
seem mauy substantial reasons why the greater interests of the
country should be represented in what is really the chief exec¬
utive council of the nation. The trade and prosperity of the
United States depends primarily upon its agricultural produc¬
tions. We give a seat in the cabinet to a Secretary of the
Navy ; but we have no navy, nor shall we have anything worthy
of ^the name for ten years to come. Then our trivial military
force is the merest apology for an army, aud yet we give this
smallest of interests a seat in the cabinet, with the title of
Secretary of War. Now in times of civil strife or foreign war
it is quite right that the President shouM have advisors and
helps in managing the army and uavy. But we have not made
a business in this country of war, nor are we likely to do so.
With us everything depends on agriculture. A really ideal cab¬
inet would include a Secretary of Labor, one of transportation,
another of commerce, one of manufactures and mining, as well
as a minister of education. But the War and Navy Departments
could with advantage be consolidated into a Department of Pub¬
lic Defence, with two bureaus.





In other words, as this is an industrial age, the chief execu¬
tive council of the nation should represent all its larger interests.
This is in the line of the development of modern communities.
There was a time when kings endeavored to perform all the
functions of modern cabinet ministers, but in the evolution of
nations ministers of State, financial ministers, ministers of jus¬
tice, of war and the like made their appearance, thus following
the well known law of differentiation. Compare the cabinet of
Queeu Victoria for instance with that of Harold or Canute, and
it will be seen how much more representative of the powers and
industries of the nation is a modern cabinet compared with
ancient kingly rule.





Some time since we ventured an estimate that the depressed
times would.lower the means of the consuming classes by some
$60,000,000 per week—that is over $3,000,000,000 per annum. We
argued that there are at least 12,000,000 persons whose incomes
would be lessened in the aggregate one-third by the shrinkage in
prices, the smaller demand for labor and the reduction of compen¬
sation. We made this estimate to show what might be expected
by the wholesale trade of the country until business revived.
Bradstreet's has been collecting statistics showing how many people
have been deprived of all employment throughout the manufactur¬
ing district of the country. Its figures are to the effect that some
350,000 of the wage-receiving class in the manufacturing regions
are entirely out of work. Of course this cannot be half the real
number, for this estimate does not take into account the workmen
in smaller establishments. Catling these 150,000, we have 500,000
entirely out of work in manufacturing alone, Estimating their
wages at $10 a week, and the average must be higher, we have a
total of $5,000,000 which these unemployed workmen no longer
spend in the retail trade establishments. This would be at least
$250,000,000 per annum, without taking into account the lack of
employment in other than   manufacturing   businesses  and   th^