April 21, 1888





Record   and   Guide.





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Vol. XLI.





APRIL 31, 1888.





No. 1,049





The death oi the Emperor of Germany would not make anyimme-
diate difference in international politics; nor is it likely to cause auy
marked depression on the borurses of Eiu-ope. The present Crown
Prince is known to be in sympathy witb Prince Bismarck, aud the
latter is knowTi to desire peace for the present. Em-ope has been
investing a great deal of money in American secm:jties and is ready
to take many more siiould any biiyiug movement be developed on
this side of the ocean; hence it may follow tbat notwithstandiug
some very imfavorable trade conditions we may have an active aud
advancing stock market, unless the unexpected should happeu.
It looks for the last few days as if there was new life in the stock
market due to the determination of tbe government to keep on
purchasing bonds and releasing the money in the treasury.





The resumption of bond buying by the government seems to have
given new life to speculation in "Wall street. President Cleveland
has given private assurances to capitalists in New York tliat tbe
administration wiU keeji on buying bonds until the surplus is so far
reduced as to cayse no uneasiness until Congi'ess meets again. The
Secretary of the Treasury will not be deterred from pursuing this
policy, even if the holders of tlie bonds should put theu- price up
considerably above wbat their value would be were the Treasury
not in the market bidding for them. This policy will make a better
feehng in Wall sti-eet and in general trade, but although we wiU be
almost alone we protest against it as unwise. There is no sense in
paying debts before they are due. It puts tbe nation at the mercy
of the great bondholders, for these purchasers make a corner in tbe
nation's securities. These being the standard it results in the lower¬
ing of tbe rate of interest, and feeds tbe fires of speculation by
enhancing the values of aU securities unnaturally.





In tbe six years extending from 1879 to 1885 the interest bearing
debt was reduced by $571,079,850. Tliis large amount was made
available for the pm-chase of new raUroad bonds and stocks, and it
accounts in great part for tbe years of speculative activity we have
gone through, the overbuilding of railroads and the lowering the
rate of interest from 7 to less tiian 4 per cent. The moment bond
purchasing stopped last July there was a crash in prices and an
increase in the rates for money in the open market. Renewed bond
buying will advantage Wall street and be a direct bonus to the rich
bondholders and corporations wbo own government securities.





of holding their power by the will of the sovereign. In other
words, the German Emperor would conform in a measure to the
Parliamentary system which obtains in Great Britain. Tbe federal
republic may come in the distant future, sliould the Emperor soon
die and hia son prove incompetent to govern tbat now mighty
power. Should he inherit, however, the ability of the HohenzoUems,
or have tbe wisdom or luck to secure another Bismarck as minister,
the repubhc would not come in his lifetime. But the Germans are
a very intelligent and educated people and fully competent to gov-
ei-n themselves. They will not be disposed to tolerate a weak or
unwise ruler after Bismarck bas passed away.





But the Boulanger furore is very significant. There is nothing In
the man or his antecedents to justify his apparent popularity. The
suppcrfc be is receiving merely means that the French are sick of
Parliamentary government. Tliey want a leader of some kind who
will govern them according to theii- own ideas. The vote just
taken does not mean that Fi-ance wants either a king or an emperor,
but a dictator, or a protector like OMver Cromwell, would be very
acceptable, Fi-ance was never of much account in the Councils of
Europe except when controlled by some great ruler or minister
such as Charlemagne, Louis XL, Louis XIV., Richelieu or Napoleon.
But when under legislative rule, as in tbe Revolution, and for the
last seventeen years, Fi-ance is torn by faction. Her finances fall
into disorder and her national prestige suffers. It seems to be im¬
possible for a republic to form a staple ministry, one that will com¬
mand respect at home or abroad. The absence of great controlling
parties is one vital defect in Fi-ench politics. Instead of two great
political organizations, hberal and conservative, the French Cham¬
ber is spht up into twenty or more warring groups, each ready to
foi'm new combinations every month or two, Tbe lesson of the
present crisis is that tbe French Constitution must be radically
reconstructed. Power must be taken from the legislative body and
lodged in a capable executive head.





But it is a diversion of tbe money of the community into rich
men's and speculators' pockets to the permanent injury of our great
industries. The surplus in the Treasury ought to have been spent
productively—that is, for river and harbor improvements, for new^
public buildings, for sea coast defenses and for rehabilitating our
foreign commerce. In this way the money of tbe people would
have been turned into the clianuels of general trade and would bave
given employment to the hundreds of thousands of work people
who are now losing their situations. But no, all the fool editors of
the daily press are uttering idiotic outcries against the $20,000,000
river and harbor bill when the internal and extei-nal commerce of
the country calls for an outlay of over $100,000,000. It would repay
ua fiftyfold if our harbors were improved and our waterways
dredged and sti-aightened so as to facilitate cheap transportation.
For years om- own foreign commerce at this port has demanded an
expenditure of fully $3,000,000 to deepen the channel in oui- lower
bay, but the river and harbor bill appropriates a bttle over $300,000,
a ridiculously inadequate sum, because of the demagoguery about
jobbery by the editors of our city press.





'* Sir Oracle," some months ago, said the outlook in Europe pointed
to a dictatorsiiip in France and the formation of something like a
federal republic in Germany. The latter event does not seem very
likely, but it is very certain that if the German Emperor was in
good health the strongly centralized government of Prince B^-
marck would give place to a Parliamentary system in which the
ministers would be responsible to the chief legislative body, instead





What harm haa om* silver coinage done that an Eastern newspa¬
per should clamor agamst tbe Beck amendment to tbe Funding
Bill, directing the Ti-easury Department to coin dollars so as to
replace national bank bills as they are withdrawn? Since 1873
there has been a contraction of $180,000,000 of national bank notes,
and it is kuown tbat there is also a steady diminution of tha
volume of greenbacks, due to wear, waste and loss. Ti-ue the
silver coinage has probably made good the loss in paper cm'rency,
but the country keeps on gi-owing in population and business, and
requires large annual additions to its currency. We have only
about $96 per capita of gold, silver and paper money. France bas
$52 per capita. Indeed we have less active currency than any of
the leading nations of Europe. Tliis forces us to depend on bank
accommodations and credits which are a constant peril to business,
leading to violent fluctuations, constantly recurring panics and
semi-panics, France never has panics, because her abundant
currency of gold and silver enables her people to conduct business
on a cash basis. This silver coinage has for some years now
saved us from the panics in prices which we were subject to every
spring and fall when our sole reliance was national bank currency.
The managers of these institutions always managed to get up a
flurry in money, so as to get exorbitant rates for current funds
twice a year, if not oftener. They cannot of course control silver
certificates, as they used to do bank issues. Hence tbe propo¬
sition to issue silver certificates as bank notes are withdrawn
is in the interest of the general trade of the country. Our
Treasury might have rendered such action unnecessary had
it increased the silver coinage without waiting for this action
of Congi-ess, for the law fixes the minimum at $3,000,000 per
month, and the maximum at $4,000,000. The Treasury Department,
under the unwise influence of WaU. atreet, has nevei- exceeded the
$3,000,000 hmit.

It seems, wheu the new aqueduct is completed, that our water
supply will not be materiaUy increased. The existing reservon- wiU
hold only nine bilUon gallons. Any surplus water now escapes
over the dam and is carried away. A proper supply for the t-wo
aqueducts, the old aud the new one, will require reservoirs with the
storage capacity of tlm-ty-eight bUlion gaUona. This we cannot
have until the Quaker Bridge dam is constructed, and tbe plans for
that are not yet agreed upou. It would take f uUy four years to con¬
struct tliis reservoir, and it may be a year before we can decide to
go to the expense that would be requhed. Next year some time
the new aqueduct wiU be finished. It will cost a great deal of
money, and should we have a di-ought this summer or next we
would not be much better off than we were in the summer of 1881.
Indeed, it would be the part of prudence to prevent the waste of
water which is now reducing our supply. Water iu thia city ia
always scarce, and in a very dry season we wiU be forced to go

through the horrors of a water famine.

----------m------—

Sir Lyon Playfair has written an elaborate article, whicb baa been
widely copied, though not in thi.s counti-y, in which he tries to





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