THE CURRENCY QUESTION.
LETTERS
T0 THE
HON. SCHUYLER COLFAX,
Speaker. of the House of Representatives,
BY
H. C., CAREY.
CHICAGO, ILL.:
JO H N A. NORTON,
BOOKSELLER, PUBLISHER, AND IMPORTER,
No. 2 Cobb's Building, 126- Dearborn Street.
1865.








TIHE CUtRTENCY QUESTION.
LETTER FIRST.
DEAR SIR:Side by side with the question of protection, and equal with
it in its importance, stands that of the Currency, to which I propose now to ask your attention.
Ilad it been possible, on the 4th of March,,1861, to take a
bird's-eye view of the whole Union, the phenomena presenting
themselves for examination would have been as follows:Mlillions of men and women would have been seen who were
wholly or partially unemployed, because of inability to find persons
able and willing to pay for service.
Hundreds of thousands of workmen, farmers, and shopkeepers
would have been seen holding articles of various kinds for which
no purchasers could be found.
Tens of thousands of country traders would have been seen poring over their books seeking, but vainly seeking, to discover in
what direction they might look for obtaining the means with which
to discharge their city debts.
Thousands of city traders would have been seen endeavoring to
discover how they might obtain the means with which to pay their
notes.
Thousands of mills, factories, furnaces, and workshops large and
small, would have been seen standing idle while surrounded by
persons who desired to be employed; and
Tens of thousands of bank, factory, and railroad proprietors
would have been seen despairing of obtaining dividends by means
of which they might be enabled to go to market.
High above all these would have been seen a National Treasury
wholly empty, and to all appearance little likely ever again to be
filled.
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2
Why was all this?  The laborer needing food, and the farmer
clothing, why did they not exchange? Because of the absence
of power on the part of the former to give to'the latter anything
with which he could purchase either hats or coats.
The village shopkeeper desired to pay his city debts. Why did
he not? because the neighboring mill was standing idle while men
and women, indebted to him, were wholly unemployed.
The city trader could not meet his notes, because his village
correspondents could not comply with their engagements.  The
doctor could not collect his bills. The landlord could not collect
his rents; and all, from laborer to landlord, found themselves compelled to refrain from the purchase of those commodities to whose
consumption the National Treasury had been used to look for the
supplies upon which it thus far had depended.
With all, the difficulty resulted from the one great fact already
indicated in regard to the laborer. If he could have found any
one willing to give him something that the farmer would accept
from him in exchange for food-that the farmer could then pass
to his neighbor shopkeeper in exchange for cloth-that that
neighbor could then pass to the city trader in satisfaction of his
debt-and that this latter could then pass to the bank, to his
counsel, his physician, or his landlord-the societary circulation
would at once have been re-established and the public health restored.
That one thing, however, was scarcely anywhere to be found.
Its generic name was money, but the various species were known
as gold, silver, copper, and circulating notes. Some few persons
possessed them in larger or smaller quantities; but, the total
amount being very small when compared with that which was required, their owners would not part with the use of them except
on terms so onerous as to be ruinous to the borrowers. As a
consequence of this, the city trader paid ten, twelve, and fifteen
per cent. per annum for the use of what he needed, charging
twice that, to the village shopkeeper, in the prices of his goods.
The latter, of course, found it necessary to do the same by his
neighbors, charging nearly cent. per cent.; and thus was the whole
burthen resulting from deficiency in the supply of a medium of exchange thrown upon the class which least could bear it, the working people of the country-farmers, mechanics, and laborers. As
a consequence of this they shrunk in their proportions as the




3
societary circulation became more and more impeded, while with
those who held in their hands the regulation of the money supply
the effect exhibited itself in the erection of those great palaces
which now stand almost side by side with tenement houses whose
occupants, men, women, and children, count by hundreds. The
rich thus grew richer as the poor grew poorer.
Why was all this?  Why did they not use the gold of which
California had already sent us so many hundreds of millions?
Because we had most carefully followed in the train of British
free trade teachers who had assured our people that the safe, true,
and certain road towards wealth and power was to be found in the
direction of sending wheat, flour, corn, pork, and wool to England
in their rudest form, and then buying them back again, at quadruple
prices, paying the difference in the products of Californian mines!
Because we had in this manner, for a long period of years, been
selling whole skins for sixpence and buying back tails for a shilling!
Because we had thus compelled our people to remain idle while
consuming food and clothing, the gold meanwhile being sent to
purchase other food and clothing for the workmen of London and
Paris, Lyons, Manchester, and Birmingham!
Why, however, when circulating notes could so easily be made,
did not the banks supply them, when all around them would so
gladly have allowed interest for their use? Because those notes
were redeemable in a commodity of which, although California
gave us much, we could no longer retain even the slightest portion,
the quantity required abroad for payment of heavy interest, and
for the purchase of foreign food in the forms of cloth and iron,
having now become fully equal to the annual supply, and being at
times even in excess of it. That demand, too, was liable at any
moment to be increased by the sale in our markets of certificates
of debt then held abroad to the extent of hundreds of millions,
the proceeds being claimed in gold, and thus causing ruin to the
banks. To be out of debt is to be out of danger, but to be in
debt abroad to the extent of hundreds of millions is to be always
in danger of both public and private bankruptcy.  The control of
our whole domestic commerce was therefore entirely in the hands of
foreigners who were from hour to hour becoming richer by means of
compelling us to remain so dependent upon them that they could
always fix the prices at which they would buy the skins, and those
at which they would be willing to sell the tails. As a necessary con



4
sequence of this, the nation was not only paralyzed, but in danger
of almost immediate death.
Such having been the state of things on the day of Mr. Lincoln's
inauguration, let us now look at the remedy that was then required.
Let us, for a moment, suppose the existence of an individual with
wealth so great that all who knew him might have entire confidence in the performance of what he promised. Let us then suppose that he should have said to the laborers of the country, " Go
into the mills, and I will see that your wages are paid;" to the
millers, " Employ these people, and I will see that' your cloth is
sold;" to the farmers, " Give your food to the laborer and your
wool to the millers, and I will see that your bills are at once discharged;" to the shopkeepers, " Give your coffee and your sugar to
the farmer, and I will see that payment shall forthwith be made;"
to the city traders, " Fill the orders of the village shopkeeper and
send your bills to me for payment;" to the landlords, "Lease your
houses and look to me for the rents;" to all, " I have opened a
clearing house for the whole country, and have done so with a view
to enable every man to find on the instant a cash demand for his
labor and its products, and my whole fortune has been pledged for
the performance of my engagements;" and then let us examine
into the effects. At once the societary circulation would have been
restored. Labor would have come into demand, thus doubling at
once the productive power of the country. Food would have been
demanded, and the farmer would have been enabled to improve his
machinery of cultivation. Cloth would have been sold, and the
spinner would have added to the number of his spindles.  Coal
and iron would have found increased demand, and mines and
furnaces would have grown in numbers and in size. Houses becoming more productive, new ones would have been built. The
paralysis would have passed away, life, activity, and energy having
taken its place, all these wonderful effects having resulted from
the simple pledge of the one sufficient man that he would see the
contracts carried out. He had pledged his credit and nothing
more.
What is here supposed to have been done is almost precisely
what has been done by Mr. Lincoln and his Administration, the
only difference being, that while in the one case the farmers and
laborers had been required to report themselves to the single individual or his agents, the Government has, by the actual purchase




of labor and its products, and the grant of its pledges In a variety
of shapes and forms, enabled each and every man in the country
to arrange his business in the manner that to himself has seemed
most advantageous.  To the laborer it has said, We need your
services, and in return will give you that which will enable your
family to purchase food and clothing.  To the farmer it has said,
We need food, and will give you that by means of which you can
pay the shopkeeper.  To the manufacturer it has said, We need
cloth, and will give you that which will enable you to settle with
the workman and the farmer. To the naval constructor it has said,
We need your ships, and will give you that which will enable you
to purchase timber, iron, and engines.  In this manner it is that
domestic commerce has been stimulated into life, the result exhibiting itself in the facts, that while we have in the last three years
increased to an extent never known before the number of our
houses and ships, our mills, mines, and furnaces, our supplies of
food, cloth, and iron; and while we have diversified our industry
to an extent that is absolutely marvellous; we have been enabled
to lend, or pay, to the Government thousands of millions of dollars,
where before, under the system which made us wholly dependent on
the mercy of the "most wealthy capitalists" of England, we found
it difficult to furnish even tens of millions.  The whole history of
the world presents no case of a financial success so perfect.
In the physical body health is always the accompaniment of
rapid circulation, disease that of a languid one. Now, for the
first time since the settlement of these colonies, have we had experience of the first. Every man who has desired to work, has found
a purchaser for his labor. Every man who has had labor's products to sell, has found a ready market. Every man who has had
a house to rent, has found a tenant. And why? Because the
Government had done for the whole nation what Companies do for
localities when they give them railroads in place of wagon roads.
It had so facilitated exchange between consumers and producers,
that both parties had been enabled to pay on the instant for all
they had had need to purchase.
Important, however, as is all this, it is but a part of the great
work that has been accomplished. With every stage of progress
there has been a diminution in the general rate of interest, with
constant tendency towards equality in the rate paid by the farmers
of the East and the West, by the owner of the little workshop




6
and by him who owns the gigantic mill. For the first time in our
history the real workingmen-the laborer, the mechanic, and the
little village shopkeeper-have been enabled to command the use
of the machinery of circulation at a moderate rate of interest.
For the first time have nearly all been enabled to make their purchases cash in hand, and to select from among all the dealers those
who would supply them cheapest. For the first time has this class
known anything approaching to real independence; and therefore
has it been that, notwithstanding the demands of the war, capital
has so rapidly accumulated. The gain to the working people of
the Union thus effected, has been more than the whole money cost
of the war, and therefore has it been that all have been able to
pay taxes, while so many have been enabled to purchase the
securities offered by the Government.
Further than all this, we have for the first time acquired something approaching to'a national independence. In all time past,
the price of money having been wholly dependent on the price in
England, the most important intelligence from beyond the Atlantic
was that which was to be found in the price of British securities
on the Exchange of London. With each arrival, therefore, we
were, to our great enlightenment, and that too by means of flaming
capitals, informed that Consols had risen or had fallen, our railroad
shares then going up or down because the Bank of England had
seen fit to purchase a few Exchequer bills, or had found it necessary to part with some of those it previously had held. In all
this there has been a change so complete that the price of British
Consols has ceased entirely to enter into American calculations.
The stride, in this respect alone, that has been made in the direction of independence, is worth to the country more than the whole
money cost of the great war in which we are now engaged.
The time had come to make it, the course of Britain having
recently been in a direction that limits the circulation and insures
a rise in the rate of interest. The Bank of England is limited to
~14,000,000 as the amount of notes that may be issued in excess
of the gold actually in its vaults. All other banks being limited
to the amount that existed on a certain day in 1844, and some of
them having since that time gone out of existence, the result
exhibits itself in the fact that the total machinery of circulation
supplied by the banks is less now than it was twenty years since.
As a consequence of this, and in despite of the extraordinary




influx of gold from California and Australia, the rate of interest
charged for the use of such machinery has been for some years
past higher than that paid in any of our Atlantic cities, the fluctuations in regard to paper of the highest character having been
between six and ten per cent. By the last accounts it had fallen
to 5-, and that is now, as English journalists advise us, as much
to be regarded as the normal price of money as was 4 per cent.
before the discovery of California mines. The danger of dependence upon the British money market, always great, has now been
much increased; and it must become greater with every year, so
long as British banking operations shall continue to be governed
by that wonderfully absurd system for which the British people
stand to-day indebted to the financial ignorance of Sir Robert Peel.
Great and obvious as have been the benefits derived by the
country from the system inaugurated under the administration of
Mr. Lincoln, they are, as we are assured, counterbalanced by their
tendency to produce inflation, and thus to increase the price of
gold. How little truth there is in this, I propose to show in
another letter, and meanwhile remain, my dear sir,
Very truly and respectfully yours,
HENRY C. CAREY.
Hon. SCHUYLER COLFAX.
PHILADELPHIA, Feb. 13, 1865.




THE CURRENCY QUESTION.
LETTER SECOND.
DEAR SIR:That the currency has been, and is, inflated, is beyond a
question. Whence, however, has come the inflation? What has
caused the existence of disease? Such are the questions to which
an answer must be obtained before we undertake to prescribe the
remedy to be adopted. Failing to do this, we shall certainly kill
the patient.
By all the currency doctors, both here and abroad, the cause of
financial crises is found in the circulation; and hence it has been
that both here and elsewhere the world has been furnished with so
many laws in regard to it, none of which would ever have existed
had the matter been properly understood. To that question it
was that Sir Robert Peel addressed himself when he framed a law
that has already twice broken down, and that must continue to
break down on each successive recurrence of the state of things it
was intended to prevent. The statute-books of nearly all of our
States present to view similar laws, all of which have proved as
utterly worthless, and some of them almost as injurious, as that
British one above referred to.
The circulation needs no regulation, and for the simple reason
that the people regulate it for themselves.  For proof of this,
look, I pray you, to the fact that the Treasury has been for
several years past engaged in trying to obtain for small notes a
circulation amounting to fifty millions, and yet has not, at this
hour, one of even the half of that amount. Why has it not?
Because the people need no more than twenty or twenty-five millions. If they did need more, they would gladly take it. When
Congress had before it a bill authorizing the emission of that




9
description of currency, it would have been deemed rank heresy
to say that no limitation was needed, yet has experience proved
that such was certainly the case. Had they omitted all restriction
on the " greenbacks," they might perhaps have found, as in the
case of the smaller notes, that the people understood better what
they needed than did their legislators. That they would have done
so, I regard as beyond a question.
It is constantly assumed that it is the banks that determine how
many notes shall be in use, and yet the experience of each and
every individual in the community proves that exactly the reverse
of this is true.  That you, my dear sir, may satisfy yourself of
this, I pray you to look for a moment to your own constant action
in regard to the question now before us. On a given day you
receive a quantity of bank-notes, which are then in circulation.
What do you then do with them? You place them in a bank,
and thus put them out of circulation. On the following day you
perhaps take them from the bank and pay them out, thus putting
them again in circulation. What control did the bank exercise
over these several operations? None whatsoever. It is you, your
friends, neighbors, and fellow-citizens generally, that regulate the
circulation, and it is just as wise to pass laws limiting its amount
as it would be to pass other laws determining the quantity of coal,
iron, sugar, or coffee to be provided for their use.
To this it is due that in communities that are really independent
the circulation is so very nearly a constant quantity.  That of the
Bank of England, in the eventful period from 1832 to 1841,
averaged ~18,000,000, and although it embraced the time of one
of the greatest excitements and one of the most fearful reverses
ever known in that country, the circulation never went beyond
that average to the extent of five per cent., nor fell below it to
that of eight per cent.  The differences exhibited are less even
than might be reasonably looked for by any one familiar with the
fact that during several of the years every workingman had been
fully employed, while in several others a large portion of the
manufacturing population was either idle or but half employed.
Take now the following figures representing, in millions, the
circulation of the New York banks, and see how uniform was its
amount until the withdrawal in 1857, by the banks, of many millions of loans that had been based upon deposits, had almost anni



10
hilated the commerce of the country, and thus deprived our people
of the power to make use of notes.
1855... 41     1859... 36       1862... 42
1856... 41      1860... 38     1863... 42
1057... 41     1861... 36      1864...40
1858... 35
In every case, as here presented, reduction had been a consequence of stoppage of the societary circulation, and not a cause
of it.
We are told, however, of the depreciation of Continental money,
French assignats, and Confederate notes, and are threatened that
we shall here experience the same result; but those who present
such views can scarcely properly appreciate the difference between
the conditions under which such paper was emitted and those in
which we stand. The first was issued by a Confederation that was
little better than a rope of sand, and that had no certain power to
provide for the ultimate payment of either principal or interest of
any debt it might contract. The second were at first receivable
only in payment for confiscated property, and were of no value for
any other purpose. As the country became more and more "a
scene of rude commotion," and as employment for the people
passed away, their quantity was more and more increased, and
they then were made a legal tender, but there existed then no organized government capable of giving protection to either property
or life-none capable of. making secure provision for any ultimate
assumption of payment by the State. The last has been issued by
an authority the permanent maintenance of which has been so much
doubted that few have held its securities longer than was required
for enabling them to pass them off to some one else. They have
been received by a community that has been cut off from the outer
world, and whose single source of wealth has wholly disappeared.
They are now used by one whose numbers are constantly diminishing, and over a surface that is becoming daily more and more circumscribed. When the notes were few in number the Southern
people were still rich, and, with the exception of Maryland, the
notes circulated in every State south of Mason and Dixon's Line,
the Ohio and the Missouri. Now, when they so much abound, the
rich have become poor, the poor have become poorer, rich and
poor to a great extent have passed out of existence, and the theatre of circulation has become limited to portions of half a dozen




11
States.  No one desires to convert Confederate paper into a
permanent security, it being clearly obvious that of security for
future payment there can be none.  The notes will still at some
price help to pay for a negro or a horse, but the bonds will not do
so at any price whatsoever.
Contrast here, my dear sir, the circumstances above described
with those under which our " greenbacks" have been issued. They
have gone out in payment for property purchased of, or services
rendered by, persons who have freely sold the one or rendered the
other. The authority by which they have been issued is one quite
as capable of binding posterity as was the Government of Washington and Adams. They are used by a people whose numbers
are constantly growing, and whose productive powers are steadily
increasing in the ratio which they bear to population. The man
who receives them finds himself surrounded by other men who
gladly give him houses and lands at prices little greater than those
he would have paid ten years since, and before the great free trade
crisis of 1857. In all this the Government co-operates by authorizing him to deposit with its officers, for periods long or short, any
amount for which he may not have present use, receiving in return
certificates by means of which he can withdraw the amount on
giving certain notice; or at his pleasure receive bonds payable in
three, four, ten, twenty, or forty years, receiving interest in gold
or paper, according to the terms agreed upon; and here we
have a security against depreciation the like of which the world
had never seen before. It is a safety valve such as could not
have been provided by any of the authorities to which the world
has been indebted for those chapters of financial history which
are connected with the Continental paper, the Assignat, or the
Confederate notes.
Having thus shown what had been the circumstances under
which the "greenbacks" have been offered for acceptance by the
world, I propose now to show what is the extent to which they
have been issued, and what have been the gold phenomena by
which that issue has been attended.
The first batch of notes amounted to $60,000,000, and were
issued under laws passed in July and August, 1861. Nearly the
whole of these have since been withdrawn and cancelled.
The second emission was under a law of February, and the third
under one of July, 1862, giving us at the close of that year a total




12
Government circulation of little less than $300,000,000. The price
of gold as yet had changed but slightly. In June, 1862, it still
stood at 104. In July and August it fluctuated between 109 and
119.  In October it rose to 124, and for the rest of the year it
varied between 130 and 137.  Compared with what we since have
seen, the advance thus far seems as very trifling; and yet the
amount of legal tender notes then existing bore a very much larger
proportion to the number of persons to whom a currency was to
be supplied-to the business that was to be transacted-and to
the surface that was to be covered than is at this moment borne
by the notes now in circulation.  Such being the case, as I propose to show it is, we must certainly look elsewhere for the cause
of the present price of gold.
In February, 1863, that price rose to 171. Why was this?
Not certainly because of any increase in the "greenback" circulation, the further emission of these having been accompanied by
the withdrawal of the original $60,000,000 of treasury notes of
which but $3,351,000 remained out in the following June. The
amount of circulation must, therefore, have been but little more
at this time, when gold was at 171, than it had been in the previous autumn when its price ranged between 115 and 124.
In the following month a further issue to the extent of
$150,000,000 was authorized, and, according to the generally received theory, gold should now have risen. Did it so? On the
contrary it fell, and in July, although the greenbacks then outstanding amounted to $400,000,000, was as low as 124. As it
seems to me, we cannot in this direction find the cause of changes
such as these.
In September the greenbacks issued had risen to $415,000,000,
and the price of gold to 143. The two, however, could have had
no necessary connection with each other, gold being now much
lower than it had been in the previous February, while the circulation was higher by little less than $100,000,000.
By the act of March, 1863, the Secretary had been empowered
to issue interest-bearing notes, legal tender for their face, to the
extent of $400,000,000.  Of this power no use appears to have
been made prior to the first of October of that year.  In that and
the following month there were issued of greenbacks $15,000,000,
and of interest-bearing legal tenders $35,000,000; and it is fair
to assume a further issue for December of $30,000,000, bringing




13
up the total amount to nearly $500,000,000. What was the effect
of this upon gold? Did it carry it up to, or beyond, the price at
which it had stood in the previous February? On the contrary,
although in the meantime $200,000,000 had been added to the
legal tenders issued, it remained 20 per cent. lower, the price on
the first of January being only 151.  How the opponents of what
is called " the paper money system " can reconcile these facts, I do
not clearly see.
Since then the price has been nearly as follows: —
January... 157 May..... 192 September.. 220
February... 159 June.... 240 October... 220
March.... 165 July.... 276 November... 230
April.... 178 August..... 257 December... 220
Throughout the whole of these latter months there had been the
most violent fluctuations, but these figures will, I think, suffice to
give you, my dear sir, a general idea of the whole movement.
What, in the meantime, had been the course of the Treasury in
regard to the issue of legal tender notes? For a reply to this
question I must refer you to the following figures exhibiting the
state of that portion of the public debt on the first of November
last: —
I. Of greenbacks the amount then outstanding was. $433,000,000
II. Of one year notes.......   43,000,000
III. Of two year notes.......   16,000,000
IV. Of two year coupon notes....        61,000,000
V. Of three year notes....    102,000,000
$655,000,000
The amount is here shown to have been greater by about one
hundred and fifty millions than it had been a year before, but of
this how much was there that really remained in circulation?  At
the present moment, as I am. assured, two-thirds of Nos. II.,
III., and IV. have been absorbed by individuals and institutions,
and have ceased to constitute any portion of the circulation. Such,
likewise, is the case with a portion of No. V. Admitting, now,
the quantity since issued of this last to be equal to the amount of
the others so absorbed in the last three months, we obtain, as a
deduction from the above apparent circulation, the large sum of
$80,000,000, and thus reduce the real amount to $575,000,000.




14
Is this, however, all the deduction needed to be made? By no
means I Throughout this period banks have been parting with
their gold, and substituting for it United States notes, both demand and interest-bearing, and individuals, to a vast extent, have
followed their example.  The farmer pays for what he needs in
local notes, but he puts aside his " greenbacks." The miner and
the mechanic-the laborer and the village shopkeeper-the soldier
and the sailor-the immigrant who is seeking to invest his little
capital, and the sempstress who is trying to accumulate the means
with which to purchase a sewing-machine-all of these have become
hoarders of "greenbacks," which have thus been withdrawn from
circulation, and have, for the time being, no more influence upon
either the gold or produce markets than they would have had they
been altogether blotted out of existence. Adding now together
all these quantities, we shall, as I think, readily obtain the sum of
$75,000,000, and thus reduce the actual Treasury circulation to
the precise point at which it stood at the close of 1863, when the
price of gold was 151.
There is, however, another portion of the circulation which now
demands attention. At the dAe of which I have spoken there
were in existence 631 national banks, with an authorized capital
of $428,000,000, to which there had been issued notes amounting
to $72,000,000. To what extent those notes had then been circulated we cannot tell, but we know, from the Report of the Commissioner of the Currency, that on the first Monday of the previous
October their actual circulation amounted to only $45,260,000, to
meet which, and to.provide for payment of their depositors, they
held, in "specie and other lawful money," $44,801,000. Of the
first, the quantity held is likely to have been very small indeed, but
admitting it to have been even as much as $10,000,000, and that
another sum of equal amount had been in the form of interestbearing legal tenders, the quantity of " greenbacks" held by them
must have been $25,000,000. This would reduce their apparent
addition to the quantity of "paper money" to but $20,000,000;
but when we take into view the fact that in the year embraced in
the Report 168 State banks had become national institutions, and
that, to the extent of their issues, the new notes had been mere
substitutes for those previously in existence, we see that the real
addition thus made to the circulation had been a quantity too
small to be worthy of any serious attention.




15
At the date of the battle of Gettysburg, say July 3, 1863, the
legal tender circulation was, as has been shown, $400,000,000, with
gold at 124. With a present circulation of only $500,000,000,
gold is above. 200; and yet, as I propose now to show, its amount
is very far less, in proportion to the space over which it is cir&lated, to the population to be supplied, and to the work to be
done, than it was at the date to which I have referred.
At that time we had secure possession of scarcely any portion
of the country south of Mason and Dixon's Line, the Ohio and
the Missouri. We did, it is true, still hold Washington, but a
rebel army was then in Maryland. South of that, in the Atlantic
States, we held Fortress Monroe, Norfolk, Newbern, Hilton Head
and its immediate neighborhood.  Kentucky was then exceedingly
disturbed, while Tennessee was mainly occupied by rebel armies.
Missouri was, in almost its whole extent, a "debateable land,"
while rebel forces occupied nearly the whole of Arkansas and by far
the larger portion of Louisiana. On the Mississippi we held
Memphis at the north and New Orleans at the South. Throughout the border and Southern States, therefore, there was little
work being done, and little use for circulation of any description
whatsoever; and of what was used nearly the whole consisted of
Confederate notes.
To-day, the Federal circulation is needed throughout Maryland,
the larger portion of old Virginia, Kentucky, Tennessee, Missouri,
Arkansas, much of Mississippi and Louisiana, parts of Georgia,
Alabama, and North Carolina, and throughout the whole region
bordering on the Mississippi. It is needed, too, by every emigrant to Minnesota, Nebraska, Colorado, and Nevada; and thus,
while we have, in the last eighteen months, added largely to the
population to be supplied, we have almost doubled the territory
within which that population may be found.
Simultaneously with all this we have added little less than onehalf to the productive powers of our people, and to the transactions
for facilitating which a general medium of circulation is required.
Having studied these things you will, my dear sir, as I think,
be disposed to agree with me in the conclusions at which I have
arrived, as follows:That the circulation bears now a much smaller proportion to
the need for it than it did at the time when gold stood at 124.




16
That to this is to be attributed that the " greenback" is frequently so scarce as to interfere, and that seriously, with the
operations of the Government; and
That, if we desire to find the cause of the present high price of
gold, it is in quite another direction we must look for it.
What that-direction is I propose to show in another letter, and
meanwhile remain,
Yours, very truly,
HENRY C. CAREY.
Hon. SCHUYLER COLFAX.
PHILADELPHIA, February 13, 1865.




THE CURRENCY QUESTION.
LETTER THIRD.
DEAR SIR:
The power of a bank to make loans is derived from the use
of its capital; from its power to furnish circulation; and from its
further power to apply to the purchase of securities the moneys
standing to the credit of those with whom it deals, and known by
the name of deposits.
That it is not to the use of the first we are indebted for the inflation now complained of is very certain.  That variations in
the second have been only those consequent upon changes otherwise produced has been already shown.  There remains, then, only
the third, and to that it is that I now propose to call your attention, first, however, asking you to accompany me for a moment in
an examination of the effect which necessarily results from the loan
by banks of moneys for which they themselves are indebted to others,
and which they may, at any moment, be called upon to refund.
Let us suppose you, yourself, to have received on any given day
notes, or specie, amounting to ten, fifteen, twenty, or fifty thousand
dollars, and that while waiting to re-invest them you have placed
them in your safe. Going now on change, you find that sum to
be there represented by yourself alone.
Let us next suppose that instead of so placing them you had
had them put to your credit in a neighboring bank, and that
the bank bad forthwith lent them to a dealer in money, or in stocks.
Going on change under these circumstances you find your money
twice represented; first by yourself who have it, as you suppose, in
the bank; and next, by the man who had borrowed it and had had it
put to his credit precisely as it had previously been placed to yours.
Here is a very simple operation by means of which the amount of
deposits has been doubled by the action of the bank itseyf; and
here it is that we find the cause of all the inflation of which we
2




18
so often have had reason to complain, and to which, as I propose
to show, we chiefly owe the numerous and extraordinary changes
in the price of gold.
By the last report of the Superintendent of the New York banks
the amount for which they then stood indebted to individuals,
called depositors, was nearly $250,000,000. The owners of this
vast sum might be seen passing up and down Wall Street, as fully
ready to purchase stocks or notes as they could have been had it
been in their private safes. Side by side with them, however,
might be seen other individuals to whom that same amount had
been lent, and who were equally ready to bid for any securities
that might be offered.  The $250,000,000 of capital had thus
become $500,000,000 of currency, so to remain until the owners
might claim to be repaid. The bank then making the same demand upon its debtors the $500,000,000 of currency would forthwith shrink into its original dimensions, and become once again
but $250,000,000.
No such general demand would, of course, ever be made, and
that none such has been needed for producing the crises of the past,
or the gold excitements of the present, will be seen on an examination of the following figures, presenting, in millions, the
movements of the New York banks before and after the great,crisis of 1857:
June'56.  Sept.'56.    June'57.  Sept.'57.  Dec.'57.,Capital... 92       96       104      107      107
Circulation.. 31      34        32       27       24
Leaving the circulation now wholly unprovided for, we will take
the amount of the so-called deposits, and set against these latter
the whole amount of specie with a view to ascertain what had been:the amount of currency created by the ballooning system:-:Deposits.   103      104      109        85       83
Specie...    14        15       14       14        29
Lent out.....  89      89       95        71       54
In the first two of these periods 89 millions of real capital had
become 178 of currency.  In the third that currency had risen to
190.  In the last it had, by the simple process of calling in loans,
been carried down to 108.
The facts here exhibited in regard to the circulation are —
First, that up to the moment just preceding the explosion there




19
had not only been no increase, but an actual reduction in its
amount; second, that that reduction had been consequent upon
a closing of workshops and suspension of business otherwise
produced; and third, that, notwithstanding the almost entire suspension of business, the apparent reduction was but $8,000,000.
That the real one must have been very far less than this will be
obvious to all who know how large is the amount of notes of
other banks remaining unexchanged, and for the time being out
of circulation, at a time of financial ease, compared with that which
is so retained in a period of crisis as severe as that now under examination.
Those exhibited in regard to the process of duplication to which
your attention has been called, are as follows:First. The very small increase that had been required for producing the largest excitement throughout the country at large.
The total amount from June, 1856, to June, 1857, was, as here is
shown, but six millions; and yet there had been thus produced an
inflation of the value of property throughout the country to the
extent of many hundreds of millions:
Second. The very small reduction required for precipitating a
whole community into a state of absolute and entire ruin, such as
existed at the date of the last returns here given.  The whole
reduction had been but forty-one millions, and yet the changes in
the value of property thereby produced counted certainly by thousands of millions.
What caused the rise?  The use by banks of the property of
others.  What caused the fall?  The demand of the banks for
payment by their debtors.  Who suffered?  Every man who was
in debt. Who profited? Every one who had the command of
money.  The rich were thus made richer and the poor made
poorer by means of an inflation caused by the action of those
very bank managers who, in all times past, had largely profited of
such changes..With all this, as has been shown, the circulation had nothing
whatsoever to do, nor could it have, for the reason that that portion
of the currency is governed by the people themselves, and not in
any manner controlled by bank directors.  Nevertheless, all our
laws are framed as if the circulation were really the portion which
needed regulation.
Following out the view thus presented I give you now, in




20
the following figures, the movement of the same institutions in the
past four years:June June Dec. June Sept. Mar. June Sept'61.'62.'62.'63.'63.'64.'64.'64.
Capital.... 110  109  109  108  109  109  108  107
Circulation.               26  39  39  32   33  31  32   33
In the first of these periods the circulation was small because
our people were almost wholly unemployed.  This was a consequence of error elsewhere, and not itself a cause of error.
Deposits and bank balances. 139  206  258  272  288  354  298  297
Specie and bank balances.  60  55  65  63  53  46  43  40
Lent out....  79  151  193 209  235  308  255  257
The duplication of these vast sums, consequent upon the very
simple process of placing money to the credit of A, as a depositor
of his own property, and to that of B as a borrower of the same
money, gives the following very remarkable figures:158  302  386 418 470  616 510  514
Price of gold at same dates   par 103  131  147  128  161  195  255
to  to        to  to  to  to
109  133       142  165  245  191
The seventh column gives the precise period of the agitation
caused by the passage of the gold bill; and from that to the eighth
we have in the price of gold the effect of the extreme depression
of the public mind of July and August last. It is by no means
to be assumed that the gold variations have been altogether caused
by the inflation above exhibited; but, that they have to nearly
their whole extent been so, the figures above most clearly prove.
Were bank loans reduced to the point at which they stood three
years since, gold would be now as cheap as it was then.
The addition to the currency that had thus been made by
the banks of the single State of New York, in comparing March,'64, with June,'61, appears to have been precisely $229,000,000.
In all such movements the rest of the country, although at a long
distance, follows suit to New  York city.  Three years since,
when gold was still at par, the debts, called deposits, of the Pennsylvania banks, stood at $25,000,000. A year since, with gold at
165, they had already doubled; and since that time the movement
in the direction of expansion has been at a greatly accelerated




21
pace. In the last twelve months the deposit line of the Philadelphia banks alone has increased $14,500,000, most of their gold
meanwhile having been converted into interest-bearing legal tender
notes. As a consequence of all this, the interest-bearing securities
held by them are little less than quadruple the amount of their
capital.  The inflation of this city alone is greater than was that
of New York city prior to the great crisis of 1857.
The addition thus made to the currency of Pennsylvania can
scarcely be estimated at less than $40,000,000. Allowing now
for all the rest of the loyal States only twice that sum, we obtain
$120,000,000, which, added to that of New York, gives us a total
of $349,000,000.
Of what does this addition consist? Of precisely the same
material that is used for inflating all other balloons-gas, and
nothing else.  The slightest pinhole causes it to disappear, and
therefore is it that we meet with changes in the dimensions of the
machine violent as are those here exhibited in figures representing,
in millions, the loans, throughout the past year, of New York city
banks:
January..   174 to 162     July...   198 to 185
February..   163 to 174     August..   185 to 188
March..   182 to 199       September..   189 to 185
April...   203 to 194      October..   185 to 186
May...   198 to 195       November..   187 to 192
June...   196 to 197       December..   196 to 204
At one moment, as we see, gas is injected, and prices of gold,
stocks, and commodities generally throughout the country, riseand then the initiated sell. At another, it is compelled to escape,
prices then falling, to the great advantage of those who had so
lately sold. Such is the movement that is allowed to remain unregulated, the aid of Congress being meanwhile invoked in favor
of establishing control over a circulation already regulated by
means of that "higher law" which subjects to the popular will that
portion of the financial movement.
Most widely different from all this is the action of that portion
of the currency furnished by the Treasury, and known by the
popular name of "greenbacks." In the one case, the addition
represents nothing but the will of certain persons whose interests are to be promoted by expansion, to be followed, on the
succeeding day probably, by contraction.  In the other, it repre



22
sents property delivered or service rendered to the Government.
In the one, it is local, and the effect upon prices is great in
proportion to the limitation of the space.  In the other, it is paid
out to the soldier, wherever found, whether in the hospitals of
New England, the camps of the Centre, or the armies of the South
and Southwest. It goes into the pocket of each individual, there
to remain until he can find an opportunity to send it. home, or in
some other manner to use it for his private benefit.  It goes
into the pockets of farmers, miners, mechanics, laborers, sailors,
traders large and small, enabling each and every one to buy for
cash, and cheaply, what before he could obtain only at the single
shop at which he could have credit. It helps to build ships on
the Atlantic and the Pacific, on the lakes, and on the Mississippi;
and it pays the men who sail or work those ships.  It enters into
every home of the Union, and into every old stocking by help of
which the sewing-woman is preparing for the purchase of a machine, or the laborer for that of a house.  The field of its
operation is coextensive with the Union, and its power to affect
injuriously the prices of gold, labor, or commodities generally, is
in the inverse ratio of the extent of that field.  Nevertheless, to
prevent the possibility of injury from that source, the Treasury has
created an acceptable investment, coextensive with the "greenbacks" in amount, by means of which every holder is enabled
to convert into an interest-bearing security whatsoever surplus
may be in his hands. Having thus provided a perfect escape-valve,
neither the captain nor the crew need fear explosion.
The banker, on the contrary, desires that there may be no valve
whatsoever but that which he himself controls. When it suits
him, he injects the gas, and continues so to do until he has arrived
as near as he dares to go to the point at which explosion may be
looked for. Next he withdraws the gas with equal rapidity, and
thus produces crises like that of 1857, the following brief account
of which, taken from Gibbons's Banks of New York, may now,
my dear sir, have some interest for you:"The most sagacious of our city bank officers saw no indications
of an unusual storm in the commercial skies. When the loans
reached the unprecedented height of one hundred and twenty-two
millions of dollars, on the eighth of August, they pointed to the
annual reduction of ten or twelve millions in the autumn months,
as one of the regular ebbs to which the market is subject; but




23
they had no foresight of extraordinary pressure, and no dreams of
panic. Credit was extended, but'the country never was so rich.'
" The banks began to contract their loans about the eighth of
August.  Securities immediately fell in price at the Stock Board.
The failure of a heavy produce house was explained by the depression of that particular interest in the market.  A report of
dishonest jobbing, and of the misuse of funds in a leading railway
company, caused partial excitement, without seriously disturbing
confidence in mercantile credit.
" On the twenty-fourth of August, the suspension of the Ohio
Life Insurance and Trust Company was announced. It struck on
the public mind like a cannon shot.  An intense excitement was
manifested in all financial circles, in which bank officers participated with unusual sensitiveness and want of self-possession. Flying rumors were exaggerated at every corner.  The holders of
stock and of commercial paper hurried to the broker, and were
eager to make what a week before they would have shunned as a
ruinous sacrifice.
" Several stock and money dealers failed, and the daily meetings
of the Board of Brokers were characterized by intense excitement.
"Every individual misfortune was announced on the news bulletins in large letters, and attracted a curious crowd, which was
constantly fed from the passing throng.
" The Clearing House report for the twenty-ninth of Augustthe first after the suspension of the Ohio Life Insurance and Trust
Company-showed a reduction of four millions of dollars in the
bank loans during the previous week.
"The most substantial securities of the market fell rapidly in
price at public sale.
"' The safety of bank-notes in circulation was suspected or denied.
The publishers of counterfeit detectors spread alarm among the
shopkeepers and laborers, by selling handbills with lists of broken
banks, which were cried about the streets by boys, at'a penny
a-piece.'
"One of the Associated Banks fell into default at the end of
August, and a fraud of seventy thousand dollars by the paying
teller roused suspicion of similar misconduct in other institutions.
"The regular discount of bills by the banks had mostly been
suspended, and the street rates for money, even on unquestionable
securities, rose to three, four, and five per cent. a month. On the
ordinary securities of merchants, such as promissory notes and bills
of exchange, money was not to be had at any rate.  House after
house of high commercial repute succumbed to the panic, and
several heavy banking firms were added to the list of failures.
" The settlements of the Clearing House were watched with the
expectation of new defaults; and their successful accomplishment,
each day, was a subject of mutual congratulation among bank
officers.




24
"The statement of the city banks for the week ending September 5th showed a further reduction in the loans of more than four
millions of dollars.
" Commercial embarrassments and suspension became the chief
staple of news in all the papers of town and country. The purchase and transportation of produce almost entirely ceased.
" From this period, there was nothing wanting to aggravate the
common distress for money. The failure of the Bank of Pennsylvania, in Philadelphia, was followed by that of the other banks of
that city, and by those of Baltimore, and of the Southern Atlantic
States generally. Commercial business was everywhere suspended.
The avalanche of discredit swept down merchants, bankers, moneyed
corporations, and manufacturing companies, without distinction.
Old houses, of accumulated capital, which had withstood the violence of all former panics, were prostrated in a day, and when they
believed themselves to be perfectly safe against misfortune.
" The bank suspension of New York and New England, in the
middle of October, was the climax of this commercial hurricane.
" Such is the outline of the most extraordinary, violent, and destructive financial panic ever experienced in this country. What
caused it? To what source or sources can it be traced? Where
lies the responsibility of it? What lessons does it teach? What
preventives are indicated against the recurrence of similar disaster? These are questions which agitate the public mind, and which
ought to be answered, if possible, for our instruction and future
guidance. "
Seeking an answer to these questions, the author furnishes a
full statement of the movement, its result being that of showing,
as he says, " beyond cavil, that the banks, not the depositors, took
the lead in forcing liquidation.  In the twenty days prior to the
26th of September," as he adds, "the deposits fell off but $341,746,
while the resources of the banks were increased $6,694,179."
The men who had taken "the lead" in measures which had
prepared for the explosion proved now to be those most active in
"forcing liquidation," and thus enabling themselves to purchase,
at low prices, stocks, bonds, and real estate which they had sold
at high ones. Aided by the large fortunes thus acquired men of
the same stamp are this day exercising a power thrice greater than
was then exhibited, the tendency of all their measures being in the
direction of making the poor poorer and the rich richer than ever
before; those of the Treasury, meanwhile, looking in a precisely
opposite direction, and tending to lower the rate of interest, while
increasing the power over his own actions exercised by the laborer,
the miner, the mechanic, and the farmer.




25
The "greenback" has fallen on the country as the dew falls,
bringing with it good to all and doing injury to none. The gasformed currency, on the contrary, is in the financial world what
the water-spout is in the natural one. Whirled about by the wind,
and wholly uncertain in its movements, none can predict of this
latter when or where its effects will most be felt, and all around are
therefore kept in a state of fever closely resembling that which distinguishes the financial action of the present hour.  The deluge
comes at last, destroying both property and life, and making a
desert where all before had been happiness and peace.
It is to restrictions upon the formation of the dew that we are
now invited, leaving wholly unchecked the action of those who profit of the desolation caused by the water-spout.  What are the
results that seem to me likely to be obtained as a consequence of
acceptance of-the invitation, I propose to show in another letter,
and meanwhile remain, my dear sir,
Yours, very truly,
HENRY C. CAREY.
Hon. SCHUYLER COLFAX.
PHILADELPHIA, Feb. 15, 1865.




THE CURRENCY QUESTION.
LETTER FOURTH.
DEAR SIR:
The lugubrious predictions of the London Times have, thus
far, not been verified. The war is now, to all appearance, coming
rapidly to a close, and not only are we not yet ruined, but theres
prevails throughout the country a prosperity such as, until recently,
had never before been known. To what causes may this properly
be attributed? How has it been possible that a community should
have furnished so many hundreds of thousands of men, and so
many thousands of millions of the material of war, without becoming even poorer than before? Let us see.
The act of secession by the South was an act of emancipation
for the North. Up to that date the latter had been mere colonies, governed by those " wealthy British capitalists" whose mode
of action is so well described in the Parliamentary Report, an
extract from which has already more than once been given, but
here repeated because of its powerful bearing on the question now
before us:" The laboring classes generally, in the manufacturing districts
of this country, and especially in the iron and coal districts, are
very little aware of the extent to which they are often indebted for
their being employed at all to the immense losses which their emrployers voluntarily incur, in bad times, in order to destroy foreign
competition, and to gain and keep possession of foreign markets.
Authentic instances are well known of employers having in such
times carried on their works at a loss amounting in the aggregate
to three or four hundred thousand pounds in the course of three or
four years. If the efforts of those who encourage the combinations
to restrict the amount of labor and to produce strikes were to be
successful for any length of time, the great accumulations of capital
could no longer be made which enable a few qf the most wealthy
capitalists to overwhelm all foreign competition in times of great
depression, and thus to clear the way for the whole trade to step in
when prices revive, and to carry on a great business before foreign




27
capital can again accumulate to such an extent as to be able to
establish a competition in prices with any chance of success. The
large capitals of this country are the great instruments of warfare
against the competing capital of foreign countries, and are the most
essential instruments now remaining by which our manufacturing
supremacy can be maintained; the other elements-cheap labor,
abundance of raw material, means of communication, and skilled
labor-being rapidly in process of being equalized."
Profiting of its liberty, the North at once determined on the
adoption of measures of protection to the farmer in his efforts for
bringing the consumer of his products to take his place in the
immediate neighborhood of the place of production, and thus to
relieve him from the oppressive tax of transportation imposed upon
him by the system above so well described. The effect of this now
exhibits itself in the factsThat the development of our mineral resources has been great
beyond all former example:
That diversification in the pursuits of our people now exhibits
itself in the naturalization of many of the minor branches of industry in regard to which we had before been wholly dependent
upon Europe:
That the demand for labor has been so great as to cause large
increase of wages:
That the high price of labor has caused great increase of immigration:
That demand for the farmer's products has so largely increased
as to have almost altogether freed him from dependence on the
uncertain markets of Europe:
That the internal commerce has so largely grown as to have
doubled in its money value the many hundreds of millions of railroad stock:
That the prosperity of existing railroads has caused large increase in the number and the extent of roads:
That here, for the first time in the history of the world, has been
exhibited a community in which every man who had labor to sell
could sell it if he would, while every man who had coal, iron, food,
or cloth to sell could find at once a person able and willing to buy
and pay for it:
That, for the first time, too, in the history of the world, there
has been presented a community in which nearly all business was
done for cash, and in which debt had scarcely an existence:




28
That, as a necessary consequence of this, there has been a large
and general diminution of the rate of interest:
That farmers, laborers, miners, and traders have therefore become
more independent of the capitalist, while the country at large has
become more independent of the "wealthy capitalists" of Europe:
That, so great have been the economies of labor and its products, resulting from great rapidity of the societary circulation,
that, while building more houses and mills, constructing more
roads, erecting more machinery, and living better than ever before,
our people have been enabled to contribute, in the form of taxes
and loans, no less a sum than three thousand millions of dollars
to the support of government.
These are wonderful results, and for them we have been largely,
yet not wholly, indebted to the re-adoption of the protective system.
That alone was capable of doing much, but we should have failed
in the prosecution of the war had not the Treasury, by the establishment of a general medium of circulation, given us what has
proved to be a great clearing house, to which were brought labor
and all of labor's products to be exchanged. Increased rapidity
of circulation was a necessary consequence of this, and to that
increase the greatly improved health of the societary body has
been wholly due.
Such having been the results of the two great measures by which
the first period of Mr. Lincoln's administration had been distinguished, it might have been believed that neither one of.them
would be abandoned without at least a full and fair inquiry into
the probable consequences of any changes that might be suggested.
Those who might have so thought could scarcely, however, have
reflected upon the general character of our legislation.  " No
people," as it has been said, " so soon forget yesterday."  None
take so little thought of to-morrow.  No one looks back to study
the cause of the good or evil that exists, and it is as a consequence
of this that we have so constantly relapsed into British free trade
almost at the first moment that protection had brought about a
cure of the evils of which it had been the cause.  Hitherto, since
1861, our course has been onward, and in the direction that
above is indicated. Now, as I propose to show, we are steadily
retracing our steps; and if the forward movement has led us to
our present prosperous state, it can scarcely well be doubted that
the backward one will lead us once again to that calamitous one
from which we so recently have emerged.




29
The most serious move in the retrograde direction is that one
we find in the determination to prohibit the further issue of that
circulation to which we have been so much indebted. Why is it
made?  Because journalists fancy that it is to "paper money" they
must attribute the, to them, great fact that paper is so high I Because men who depend on fixed incomes fancy that they should
live better were the gold standard once again adopted I Because
every free-trader in the land charges the high price of gold to the
use of "greenbacks," and sees therein the causes why he cannot,
with profit to himself, fill our markets with British cloth and British
iron I
What is the present effect of the hesitation of the Treasury to
use the power that yet remains at its command? It is paralyzing
the societary movement, to the great loss of both the people and
the Government. Labor is less in demand. Cloth, iron, and a
thousand other commodities move more slowly. Why all these
things? Because the Treasury does not fulfil its contracts.  The
unpaid requisitions amount to $125,000,000, and the Treasury is
empty.  The contractor who obtains a certificate sells it at heavy
loss; while many, as I am told, find difficulties interposed in the
way of obtaining certificates, most of which have their origin in
the indisposition to acknowledge debt when there exist no means
with which to pay it. How it is with the men who are now serving
in the field was well shown, a few days since, by Senator Wilson,
when he told his brother Senators that "they needed more money
than they could obtain to pay their just debts-what they had
agreed to pay." " Tens of millions of dollars," he continued, " are
now due to our armies, many of whose officers have been unpaid
for months; the Generals, meanwhile, holding by handfuls resignations tendered by men who find themselves forced to retire, as the
only means now left to them of providing for their families."
Turning now to a letter in this day's Tribune, I find a statement
of the facts of the case, and their effects, to which you may perhaps
excuse me for asking your attention.  It is as follows: —
" It is useless to deny the fact that men once ardent in the cause
are becoming lukewarm in their attachment to a Government which
so sadly fails to discharge, in this respect, its self-imposed obligations, and seems so careless of those over whom specially the aegis
of its protection should be thrown.  No wonder that the soldier
should grow weary when he reflects that his arduous hardships,
undergone on long marches, in the trenches, on the picket line,
scorching then under the rays of a midsummer's sun, and shivering




30
now in the merciless blasts of winter, exposed to all the inclemencies of a variable climate, are suffered to go so long unrecognized
by his Government; no wonder that when every mail brings him
the old story of his family's destitution, and when he remembers
his inability to aid them, he should grow lukewarm in the cause
which years ago he espoused with all the ardor of a man and a
patriot.  It is in vain that he tries to place country above homeabove the wife whom he has solemnly sworn to cherish and protect,
the offspring whom Heaven has given him to support, or the aged
parents whose infirmities demand his filial consideration; the
thought of his domestic responsibilities will absorb all others, and
will embitter every hour of his soldier-life.
"Every day resignations are forwarded by officers whom stern
necessity has compelled to ask for their discharge from the military
service, in order that they may return home to relieve the pressing
wants of their families, and shall we say, too, that desertions to
the enemy frequently occur whenever men are impelled by the same
motives.  Officers and men, in making application for leaves and
furloughs, are often forced to make the humiliating confession that
they desire to go home to restore order to their households, upon
which, during their absence, shame and dishonor have fallen, and
the plea of their families' extreme destitution is still more frequent.
In the name of humanity, then, let the troops be paid with as little
delay as possible; the best interests of the service demand it."
Entirely in keeping with this are statements coming from the
West, of the great distress of Government contractors compelled
to forced sales of the vouchers in their hands-of the great rise in
the general rate of interest-and of the extremely sluggish state of
the societary circulation. The Government has made itself responsible for the financial movement of the country, and when it stops
payment there is stoppage everywhere.
Why has it stopped? Because those in the control of public
journals fail to see that the cause of the high price of paper and
of gold cannot be found in the circulation I Because the Government itself fails to see that the circulation now furnished bears a
smaller proportion to the needs of the people, and to the extent of
country requiring to be supplied, than did that which was furnished
when gold could be bought at an advance of 10, 12, or 15 per
cent.! Because all who write or speak on this subject fail to see
that, with the extension of the power of the Union over the Cotton
States, there must arise an absolute necessity for furnishing to the
people of those States machinery of circulation adequate to the
performance of the same work that has so well been done in these




31
Northern States!  So far from diminishing the supply of that
machinery, there is a pressing necessity for its increase.
Anxious for a reduction in the price of gold, journalists are
almost everywhere calling upon Congress to increase the taxes, to
give up selling machinery of circulation that costs it nothing, and
to take to buying such machinery at the market price. Obedient to
their orders the treasury is buying it, and the price at which it buys
is shown in the following extract from an advertisement of the
loan that is now on sale:" By authority of the Secretary of the Treasury, the undersigned
has assumed the general subscription agency for the sale of United
States treasury notes bearing seven and three-tenths per cent.
interest per annum, known as the SEVEN-THIRTY LOAN. These
notes are issued under date of August 15, 1864, and are payable
three years fromn that time, in currency, or are convertible at the
option of the holder into U. S. 5-20 SIX PER CENT. GOLD-BEARING
BONDS. These bonds are now worth a premium of nine per cent.,
including gold interest from November, which makes the actual
profit on the 7-30 loan, at current rates, including interest, about
ten per cent. per annum, besides its exemption from State and
municipal taxation, which adds from  one to three per cent. more,
according to the rates levied on other property."
This is certainly a high price to pay for the use of a little money,
and the reason why it is so high is that the supply of the commodity needed is diminishing in the proportion borne by it to
public and private needs.
We have here, however, only $200,000,000, interest upon which
is to be paid in gold three years hence.  Six hundred millions
more are now asked for, and the demand is, we are told, to be
accompanied by a withdrawal of even the existing power to
furnish legal tenders bearing interest.  As those now existing become more and more withdrawn from circulation, the societary
machinery must gradually diminish in its quantity, and that, too,
just at the time when the theatre on which it is to be employed is
likely to be almost doubled.  The necessary consequence of this
must be such a rise in the rate of interest as will compel the export of Government bonds, and the rapid increase of dependence
on the money markets of Europe-each step backward being thus
but the precursor of another and greater one.  So long as they
shall continue to be sold abroad money will continue to be obtainable; but when the foreign market shall have become fully glutted




32
it will, as in. the period from 1837 to 1842, become unobtainable
at any price.
The gold interest now payable requires $60,000,000. Adding
these new loans, and making their interest payable.in gold, we
shall, three years hence, need $108,000,000, most of which is likely
to have to go to Europe. Add now to this, first, the $30,000,000
required for payment of interest on the old foreign free trade debt;
second, only an equal amount for absentees, temporary and permanent; and we obtain a demand amounting to $168,000,000, that
must be met before we can purchase a piece of cloth or a ton of
iron. Where is all this gold to come from?
Tax the people I is the answer.. Give us an income tax of 25
per cent.l Tax sales! Tax manufactures! All this is being done,
and so thoroughly that important branches of manufacture are
likely to be taxed entirely out of existence. Paying his taxes in
paper, and obtaining cash for his products, the ironmaster can
scarcely even to-day make head against those " wealthy capitalists"
of England who have already placed themselves on such a footing,
as regards freight and duty, that it is they who, under a gold system,
will be protected, and not their American competitors.  So, too,
with paper, the domestic taxes on which are ten per cent., while
foreign paper is likely to be admitted at three. So, too, as I understand, is it with leather.  Mr. Sherman tells us that $40,000,000
in gold will be required to purchase paper abroad that if made at
home would yield $10,000,000 to the treasury.  Add to this
$100,000,000 to pay for the iron needed for taking the place
of that now made in furnaces that will then be out of blast,
and we shall have quite enough to pay to those European nations
whose markets are now glutted with food, and who -have taken
from us, in the past five months, of flour, wheat, and corn, just as
much, and no more, as would command in gold somewhat less
than two millions of dollars.*
The contributions to the internal revenue made by paper, iron,
and leather, appear, under the retrograde system now inaugurated,
likely to be very small indeed. How will it be with other manufactures, paying as they must, at a gold value, duties that had been
laid when two dollars in paper had been but the equivalent of one
* The precise quantities of these commodities shipped to Belgium, France,
and Britain, has been: Of flour, 59,998 barrels; of wheat, 1,305,313 bushels;
and of corn, 56,933 bushels.




33
in gold? How will it be with the farmer, obliged to look to Europe
for a market for his products? How will it be with the miner and
the laborer when rolling-mills are closed and mines have ceased to
be worked? The answer to all these questions will be found in
the simple propositions, that the power of accumulation increases
almost geometrically a~ the rapidity of the societary circulation
increases arithmetically; and that it declines in the same proportion as the circulation becomes more languid.  In the few years
through which we just have passed it has been increasing rapidly,
but, under the change of policy that has been now inaugurated, it is
already slowly moving in the opposite direction. Admitting the
truth of those propositions, then must it be also admitted that,
prompted by an anxious desire once again to handle gold, we are
killing the goose that has already laid the many golden eggs so well
described in the following paragraph, from this day's Tribune:" The internal revenue for the month of January just past
amounted to the enormous sum of $31,076,902 89-over a million
of dollars a day, including Sunday I  And yet confessedly the
machinery for collecting this branch of the nation's income is imperfect and undergoing change. Vast as is that sum of internal
revenue, daily and monthly, how light a burden is it to the business
of this rich and vigorous nation I And with what patriotic cheerfulness and acquiescence the people pay this tax to preserve their
nation and to maintain democracy."
To what do we owe these wonderful results of a state of civil
war?  To rapidity of the societary circulation, and to nothing
else! To what have we been indebted for that rapidity? To protection and the " greenbacks"! What is it that we are now laboring to destroy? Protection and the Greenback I
Let us continue on in the direction in which we now are moving,
and we shall ere long see, not resumption but repudiation; not a
contradiction but a confirmation of the predictions of the Times;
not a re-establishment of the Union, but a complete and final disruption of it.
What are the means by which these calamities may be avoided,
I propose to show in another and final letter, and meanwhile
remain, my dear sir,
Yours, very truly,
HENRY C. CAREY.
Hon. SCHUYLER COLFAX.
PHILADELPHIA, February 17, 1865.
3




THE CURRENCY QUESTION.
LETTER FIFTH.
DEAR SIR:The measures now in preparation, as regards both the customs
and internal revenues, tend, as it appears to me, in the direction of
stoppage of the societary circulation, of rise in the rate of interest,
of increase in the power of men engaged in the creation of financial
water-spouts, and of permanent maintenance of a premium on the
precious metals. If so, then, if we are ever again to witness here
the regular redemption of promises to furnish gold and silver, it
must occur as a consequence of the adoption of a course of policy
directly the reverse of all that recently has been done, and all that,
if we are to credit the public journals, is in the contemplation of
those who are charged with the direction of our financial movements.
The existing derangement of the currency is wholly due to the
action of those who manage the windbag system described in a
former letter, and while their operations shall continue to be, as
now they are, wholly unrestrained, financial crises must continue
to reappear, and the price of gold must continue to be as uncertain
as is their course of action. Such being the case, it is of high
importance that proper checks be forthwith instituted, and now,
for the first time in our history, is it in the power of Congress to
let us have them. To that end, Jet us have a law declaringFirst, that no bank shall hereafter so extend its investments as
to hold in any form other than those of gold, silver, U. S. notes,
or notes of national banks, more than twice its capital:
Second, that in the case of already existing banks whose investments are outside of the limits above described, any extension
thereof beyond the amount at which they stood on the first of the
present month shall be followed by instant forfeiture of its charter.
Having thus established a check upon further extension, the




35
next step should be in the direction of bringing the operations of
existing banks within proper limits. To that end, let us have a
provision imposing on all investments outside of the limits above
described a tax which, when added to that already existing, shall
amount for the present year to one per cent.  In the second year
let it be made 14 per cent. on all over 90 per cent. in excess of the
actual capital upon which dividends are paid. In the third, 1,
per cent. over 80 per cent.; and in the fourth, 13 over 70 per cent.
Thenceforth let the tax grow at the rate of a quarter per cent. per
annum until, by degrees, all banks shall have so enlarged their
capitals, or so reduced their loans, as to free themselves from its
further payment.
Holding interest-paying securities 70 per cent. in excess of its
capital, a bank would be always in a condition of perfect safety,
and could give to its stockholders dividends of at least 8 per cent.
Such stock would be preferable to almost any other securities in
the market, and there would be no difficulty in so enlarging the
foundation as to give to the whole structure the form of a true
pyramid, instead of the inverted one which now presents itself to
the eye of all observers.
Let us have a law embracing these provisions, and we shall then
be fairly on the way towards the establishment of a financial system the most perfect the world has ever seen. Let us have it, and,
as you will clearly see, the need for restrictions on the circulation
will wholly have passed away. The day, indeed, will then be near
at hand when banks will have ceased to be competitors with the
Treasury for furnishing circulating notes of any kind, and when
the nation may profit to the extent of 50, if not even 60 millions
a year of the power to furnish the machinery of circulation.
Simultaneously with the passage of such a law, let the Government determine honestly to pay its debts.  The soldier in the field,
and the officer who is placing his life in daily hazard, have a right
to demand of the Treasury that it shall give them such certificates
of its indebtedness as will enable their wives and children to go to
the neighboring shop and purchase food and clothing.* The contractor and the shipbuilder have a right to claim that when certificates are issued they shall be in such a form as will enable them to
* The amount now due to the army alone is stated by Senator Wilson
at the enormous sum of one hundred and thirty-eight millions of dollars.




36
avoid the further payment of the usurious interest to which they
have so long been subjected. Paying promptly, the Government
will buy cheaply; and should such payment have the effect of
causing the supply of "greenbacks" to be in excess of the demand,
the Treasury will thence derive a double benefit: first, in being
thus enabled to borrow what it needs at reasonable rates; and
second, in having its need for borrowing diminished by reason of
the increased stimulus thereby given to that societary circulation
upon the rapidity of which it is dependent for both the maintenance and the growth of the Internal Revenue.
The whole South now requires reorganization, and one of the
first steps in that direction should be found in furnishing machinery
of circulation. As much in need of this stands the whole of that
great West for the development of whose wonderful powers we are
now exporting in that direction so many hundreds of thousands of
our people. If the Government does not supply that machinery,
who is there that can or will do so? Look carefully, I pray you,
my dear sir, at the vast field that is to be occupied, and at the
great work that is to be done, and then wonder with me that the
Government should permit its soldiers to perish in the field, while
it is debating the terms of a loan to be made to it by men all of
whose interests are to be promoted by a diminution of the circulation and an increase of the rate of interest. Let our soldiers be
paid, let the credit of the Government be once again re-established,
let the rate of interest be kept down, and let the Treasury reassert
its independence, and all will yet go well.
Having thus, as paymaster, re-established its credit, let it next
place itself in a creditable position as regards those who had been
led to see in the Morrill Tariff a pledge of protection against those
" wealthy capitalists" whose fortunes count by millions, and who
use those millions as "instruments of warfare" by means of which
they are enabled to "overwhelm all foreign competition, and to
gain and keep possession of foreign markets." Let it restore
those great fundamental branches of industry which constitute the
pillars of our national temple to the position in which they stood
in 1861, increasing the duties on foreign products by just so much
as the taxes since imposed on domestic ones, and the result will
then exhibit itself in the fact that sugar, tea, coffee, soda ash, and
other raw materials of food and manufacture, will twice over make
amends for any loss that may be experienced by the revenue be



37
cause of the substitution of domestic cloth or iron for that now
made in foreign furnaces or on foreign looms.
Let these things be done, and we shall then cease to look abroad
for purchasers of our bonds. Let this be done, and we shall soon
find ourselves on the road towards becoming purchasers of those
now held abroad, every one of which should be redeemed before we
ever again place ourselves in a position to be required to furnish
gold and silver in payment of our notes.
To many it might seem that this would be a postponement of
resumption to a date so distant that none of them would live to
see it. Let, however, all such persons study what was done in
this respect in the brief period of the existence of the tariffs of
1828 and 1842; let them next look to what has been done in the
past four years; and they will see that all that I have indicated as
what is needed to be done, is only what, under a sound and permanent system, may be done before the lapse of the next decade.
As a rule, reformers desire to move too rapidly, and therefore
fail to attain their objects.  They omit to see that when Nature
has important purposes to accomplish, she works slowly and with
almost invisible machinery, as when she sends the daily morning
dew. When she desires merely to destroy a ship or to root up a
forest, she sends the tornado or the water-spout. Let us follow
her example. We have a great work to accomplish, and we should
now profit of the lesson read to the world in'that period which
followed the close of the great war of the French Revolution, and
exhibited a scene of destruction that had never before, in time of
peace, been witnessed. Believing it to be one that should be carefully studied, I now invite you, my dear sir, to accompany me in a
brief review of the facts in the order of their occurrence.
For twenty years the Bank of England had been injecting gas
into the currency, but with the return of peace it became necessary
that it should be steadily withdrawn. In the two years from 1815
to 1817, the bank directors had, by means of the very simple operation of calling in its claims on one hand, and reducing its liabilities
on the other, reduced the apparent quantity of money at the command of the community to the extent of ~12,000,000, or little
short of $60,000,000. So far as regarded the operations of society,
this had been equivalent to a total annihilation of that large sum,
and to that extent a contraction of the standard by which the community was required to measure the value of all other commodities




38
and things. Had the yardstick been doubled in length, or the
pound in weight, for the benefit of all persons who had contracted
to purchase cloth or corn, the injury inflicted would have been
trivial by comparison with the change that was thus effected. As
compared with the property of the people of Great Britain, that
sum was utterly insignificant, yet did its abstraction cause an arrest
of the circulation almost as complete as would be that produced
in the physical body by stoppage of the supply of food. Farmers
and merchants were everywhere ruined. Of the country banks, no
less than two hundred and forty-being one in four of their whole
number-stopped payment; while one in ten and a half became
actually bankrupt.  " Thousands upon thousands," says Mr. McCulloch, " who had in 1812 considered themselves affluent, found
they were destitute of all real property, and sunk, as if lby enchantment, and without any fault of their own, into the abyss of
poverty." Throughout the country, there was, to use the words of
Mr. Francis Horner, "an universality of wretchedness and misery
which had never been equalled, except perhaps by the breaking
up of the Mississippi Scheme in France." In the midst of all this
ruin, however, the bank, which had supplied the gas, prospered more
than ever, for the destruction of private credit rendered its vaults
and its notes more necessary to the community.
The groundwork having thus been laid by the bank, Parliament
passed, in 1819, an act providing for the resumption of specie
payments, and thus re-established, as the law of the land, the
standard that had existed in 1797-among the most remarkable
measures of confiscation to be found in the annals of legislation.
For more than twenty years all the transactions of the United
Kingdom had been based upon a currency less in value than that
which had existed in 1796. In the course of that long period,
land had been sold, mortgages given, settlements made, and other
contracts of a permanent nature entered into, to the extent of thousands of millions of pounds, the terms of all of which were now to
be changed for the benefit of the receivers of fixed incomes, and to
the loss of those who had land, labor, or the produce of either, to
sell. As a necessary consequence, land fell exceedingly in price,
and mortgagees everywhere entered into possession. Labor became superabundant, and the laborer suffered for want of food.
Machinery of every kind was thrown out of use, and manufacturers
were ruined. Manufactures, being in excess of the demand, were




forced upon foreign markets, to the ruin of the capitalists and workmen, miners and machinists, of the other countries of the world.
Peace had brought with it widespread ruin, but it everywhere
enriched the money-lender —his commodity rising, while land became so cheap that he could purchase at less than half its previous
price.  The annuitant and office-holder profited-their dividends
and salaries having become payable in coin, that would purchase
double the quantity of food and clothing for which they had at
first contracted. Farmers and laborers, mechanics and merchants,
were impoverished-their taxes remaining unchanged, while their
labor, and its products, commanded less than half the money for
which they would before have sold.
Bad as is this, it will be infinitely worse with us if we shall attempt to follow the example here placed before us. Let us put our
house in order; let us adopt the measures needed for making the
Declaration of Independence something more than a mere word
of small significance; let us do all this slowly and quietly, and we
shall set to the world an example in peace even more remarkable
than that which has been set in the course of the present extraordinary war-returning to the old standard, and without the occurrence of the slightest crisis.
That this may be done, it is needed only that those who direct
our fiscal operations shall recollect that the National Treasury
has now become a partner in, and entitled to the lion's share of,
the profits of every mine, every furnace, every mill, every workshop, and every farm in the land, and that every increase in the
prosperity of such works must be to it a source of double profit:
first, that arising out of the direct contributions of the work itself;
and second, that resulting from the increased consumption of sugar,
tea, coffee, and other commodities consumed by those who mine
the coal, roll the iron, and make the engines and the cloth. The
day for a clear perception of the existence of this harmony of all
real interests may or may not be near at hand. For the promotion
of its arrival, we need to see extended throughout the Union the
same principle of association that has proved to be so effective
throughout the present war. We need to see A GREAT NATIONAL
LEAGUE, embracing men who grow wool, and others who convert
it into cloth; men who make iron, and others who need railroad
bars; men who raise food, and others who combine food and ore
into iron; men who build ships, and others who consume the




40
sugar and the tea that ships transport; and finally, men who pay
taxes, and others who make the laws under which those taxes are
collected. In the words of Jackson, we need to be Americanized.
Whenever the day shall arrive when we shall have so become,
then, and not till then, shall we have placed ourselves in a position
successfully to contend for the control of the commerce of the
world, and thus to
OUTDO ENGLAND WITHOUT FIGHTING HER.
That control will find its place among the hands and heads of
the community that makes and uses the largest quantity of iron.
A single decade of the system above described would suffice for
placing us, in this respect, side by side with England. At the
close of another, she would be left far behind, and we should then
have vindicated our claim to that position in the world of which
our people so often talk, and of the true means of obtaining which
they so little think.
Hoping that the event may prove that the time for serious
thought has now really arrived, and begging you to excuse my
numerous trespasses on your attention, I remain, my dear sir, with
great regard and respect,
Yours, faithfully,
HENRY C. CAREY.
Hon. SCHUYLER COLFAX.
PHILADELPHIA, February 18, 1865.




CAREY'S SOCIAL, SCIENCE.
Introduced as a Text-book into the University of Pennsylvania, Jan. 1865.
BEING NOW TRANSLATED INTO GDERMAN, AND TO BE USED AS A TEXT-BOOK AT TEE UNIVERSITY OF BERLIN,
PRUSSIA, SESSION 186-6.
JTTJST PUJBLISHEsD
MANUAL OF SOCIAL SCIENCE,
BEING A CONDENSATION OF THE
"PRINCIPLES OF SOCIAL SCIENCE" OF H. C. CAREY, LL. D.
BY KATE McKEAN.
"The universe is a —harmonious whole, the soul of which is God. Himself the perfection of harmony,
He has impressed upon every soul, as His image, its own especial harmony. Numbers, figures, the stars,
all nature indeed, harmonize with the mysteries of religion."-KEPLER.
In one volume, 12mo.  Price $2 25.  By mail free of postage to any address,
CONT'ENTS -Of Science; Of Man the shbject of Social Science; Of Increase in the numbers of Mankind;
Of tle Occupation of the Earth; Of Value; Of the Forlnation of Society; Of Appropriation; Of Changes
of Matter in Place; Of Changes of Matter in Form-Chemical and Mechanical Changes; Vital Changes;
Of the Instrument of Association —Monr and Price, The Supply of Money, The Charge for the Use of
Money, The Trade in Money; Banking in England, France, and the United States; Hume, Smith, and
other writers on Money; Of Production and Consumption; Of Accumulation; Of Circulation; Of Distribution —Wages, Profits, and Interest; The Rent of Land; The People and the State; Of Competition;
Of Population; Of Food and Population; Of Colonization; Of the Malthusian Theory; Of CommerceThe Relations of the Sexes, The Relations of the Family, The Commerce of the State, The Commerce of
the World; Of Society Organization; Of Social Science.
" The author drew me more and more towards him, as much indeed by his moral and humane character as by his far-seeing mind. I gradually learned what I possessed in the writings of the man whom
I had previously knlown only as the expounder of apparently strange views in relation to the Rent of Land;,or, as I mIny truly saly, I had kllown him only by name. I thought it but reasonable, then, to make myself
Ilaster of the subject before laying my opinions before you. What really had to be done was nothing
less than to exchange the well nigh Ptolomecan point of view of scieince for the Copernican. What the
heliocentric point of view is to astronomers, what the improved theories in regard to space and time are
to mietaphysicians, that the new axiom of the course of development in the cultivation of the soil is to
the students of Social Science.   *        *          *        *        *             *        *
"I can to-day, with a good conscience, and without a fear that I shall ever be forced to recall my judgment, declare that that Carey, the mention of whom was once so strange to you, is not only the annihilator of a goodly portion of the fancies hitherto held, but also the founder of a positive and harmonized
system of Social Science, a system fruitful in every direction. The reform of traditional political economy,
which he has not only pioneered but completed, is of so vast a nature that I almost hesitate to call it
solely a reform, We have in fact to do with an entirely original creation. The work of Carey is to me
as an oasis in the desert of every-day monotony." —" Carey's Umwjilzung den' Volkswirthschaftslehre
foied Socialwissenschatft;" von Eugen Diiiring, Docelt der Philosophie und Nationaliekonomie an der
Berliner UniversitAt. Munich, 186.3.




"It is under the impression that the most certain mode of spreading a knowledge of truths which lie
at the root of all national progress, is by making them a part of the instruction of the young, that the
editor has ventured, encouraged by the approbation of the author, to undertake a work more suited to
a masculine than to a feminine intellect. This'Manual of Social Science,' it will be perceived, is little
more than a selection from the great work above referred to, the words of which have been as far as
possible preserved, although the vast variety of facts and illustrations which give to it such a living
interest have necessarily been sacrificed to brevity."-Extract.from the Editor's Preface.
" Mr. Carey is unquestionably the greatest American economist, one who would occupy a distinguished
place in any of the States of Europe   *  *  *  An economist first, he is also a philosopher and a
naturalist. *    *   * * His'Principles of Social ScienCe' is one of those books whose careful study is
rewarded by the largest profit." —MoarN, Les Idles dae Temps Pr.'sent, Paris, 1861.
"To any student of Carey's work I can promise the most elevating hours of intellectual enjoyment,
followed by the richest harvest; and to the economist and the statesman, a powerful incentive to further
investigation." —WIRTH, Introduction to Die Gratdlagen der Socialwissenschaft.
"We shall be content if we shall have succeeded in giving such a preliminary conception of the work
(' Principles of Social Science') as shall lead our readers to the careful study of a thinker who merits
their highest respect. Carey is a writer who, as we know from our own experience, steadily grows upon
us, and even performs more than his reader had, by the fascinating first impression he had received, been
led to hope for."-Grenzboten, Berlin, Sept. 1864.
"This o e truth (the theory of rent) would suffice for placing Carey in the first rank of philosophers,
yet it is only because of deficiency of space that we lhave selected it from among the new and profound
thoughts with which his work abounds." —Augsburg Abendzeitung.
"The services of Carey have been immense. * * He has disproved the fatal necessity of poverty
and crime, those pretended companions of civilization, destructive as they are of economical harmony."
-Bunge, Hatrmony of Economical Relations according to the System of Carey. St. Petersburg, 1860.
The translator of the German edition of Carey's "Principles of Social Science" (Munich, 1S64) writes
to the author, under date of Munich, Dec. 18, 1864, as follows: "Since my last letter I sent you a number
of the' Grenzboten,' containing a very able article from Dr. D[iiing, Professor at Berlin,;f end of mine.
This gentleman has written also an essay about your Social Science, which is already in t*he hands of Mr.
Rohsold, and will be printed in a few weeks. * * * The sale of the German edition is going on rapidly,
and the publisher calculates that all the copies will be sold befolthe end of *axt year. The work is
qluoted in almost every article that treats of economical questions, and even the opponents feel obliged
to take notice of it, which they hitherto avoided. In general the German edition may be called a complete
success of your ideas. For your kind permission to translate the neZ condensed edition of your work,
I thank you very much, and hope that I can soon begin with that wo'rk."
FINANCIAL CRISES, their Causes and Effects.  8vo., paper,.....    25
FRENCH AND AMERICAN TARIFFS Compared, in a Series of L~rs addressed
to Mons. M. Chevalier. 8vo., paper,.                                                  25
HARMONY OF INTERESTS; Agricultural, Manufacturqig, and Conmticial.  8vo.,
paper,......75
Do.             do.             do.              cloth,..                         1 50
LETTERS TO THE PRESIDENT OF THE UNITED  STATES.  Pa*tr,..    50
LETTERS TO THE HON. SCHUYLER COLFAX, Speaker of the House of Representatives United States, on "The Paper Question," "The FarmeFrs Question,"
"The Iron Question," "The Railroad Question," and "The Currency Question."'
8vo., paper,.... 75
MISCELLANEOUS  WORKS: comprising  "Harmony  of Interests,"  "Money,"
"Letters to the President," "French and American Tariffs," "Finaeial Crises,"
"Letters to Colfax," etc. etc.  1 vol. 8vo., cloth,.                    3 50
MONEY: A LECTURE before the N. Y. Geographical and Statistical Society.  8vo.,
paper,......                                                                        25
PAST, PRESENT, AND FUTURE. 8vo.,....   2 50
Do.             do.                12mo.,..           1 50
PRINCIPLES OF SOCIAL SCIENCE, 3 vols. 8vo., cloth,..10 00
THE SLAVE TRADE, DOMESTIC  AND  FOREIGNb Why it Exists, and How it
may be Extinguished. 12mno., cloth,...                                               ] 50
CoNaErNTs.-The Wide Extent of Slavery-Of Slavery in the British Colonies-Of Slavery in the United
States-Of Emancipation in the British Colonies-How Man passes from Poyerty and Slavery toward
Wealth and Freedom-How Wealth tends to Increase-How Labor acquires Value and Man becomes Free
-How Man passes from Wealth and Freedom toward Poverty and Slavery-How Slavery Grew, and
How it is now Maintained in the West Indies-How Slavery Grew, and is Maintained in the United States
-How Slavery Grows in Portugal and Turkey-How Slavery Grows in India-How Slavery Grows in
Ireland and Scotland-How Slavery Grows in England-How can Slavery be Extinguished?-How Freedomn Grows in Northern Germany-How Freedom Grows in Russia-How Freedom Grows in DenmarkHow Freedom Grows in Spain and Belgium-Of the Duty of the People of the United States-Of the Duty
of the People of England.
Any of the above Books will be sent by mail free of postage.
E13  Baird's Catalogue of PRACTICAL AND SCIENTIFIC BOOKS, including all of CAREY'S
WORKS, just issued, will be sent free of postage to any one who will fevor me with his address.
JOHN A. NORTON,
Bookseller, Publisher, and I mporte~,
No. 2 Cobb's Building, 1262' Dearborn St., Chicago, Ill.