Almost every nation has at some time issued political money. During the Franco-Prussian War in 1870, France, through the medium of its great state bank, made forced issues of notes of a political nature, which only slightly depreciated. Many countries--Russia, Austria, Portugal, Italy, and most of the South and Central American republics--have had or still have depreciated paper currencies. At once, at the outbreak of the great war in 1914, the governments of the warring nations began to exercise a strict control over the issue of paper money, sought to gather into the public treasury all the specie, and to give paper (either governmental notes or bank notes) practically a forced circulation, making it almost the sole circulating medium. The values of the paper moneys have fallen in all the countries, especially in Germany and Russia. In such cases the money partakes somewhat of the characters both of bank notes and of political money. Resorted to in desperate extremities, political money has usually proved to be a costly experiment. A result usually unintended is the derangement of business and of the existing distribution of incomes. The rapid and unpredictable changes in prices gives opportunity for speculative profits, but injure legitimate business. This incidental effect on debts and industry offers the main motive to some citizens for advocating the issue of paper money. It is peculiarly liable to be the subject of political intrigue and of popular misunderstanding. It is this danger, more than anything else, which makes political money in general a poor kind of money. § 11. #Theories of political money.# There are two extreme views regarding the nature of paper money, and a third which endeavors to find the truth between these two. First is that of the cost-of-production theorists, who declare that government is powerless to influence value, or to impart value to paper by law. They deny that there is any other basis for the value of money than the cost of the material that is in it. Money made of paper, on a printing press, has a cost almost negligibly small, and, therefore, they say it can have no value. The facts that it does circulate and that it is treated as if it had value are explained by the cost-of-production theorists as follows: while the paper note is a mere promise to pay, with no value in itself, it is accepted because of the hope of its redemption, just as any private note. Depreciation, according to this view, is due to loss of confidence; the rise toward par measures the hope of repayment.