Readings in Money and Banking: Selected and AdaptedPhillips, Chester Arthur
General
Readings in Money and Banking: Selected and Adapted
Phillips, Chester Arthur
Banks and banking; Banks and banking -- United States; Money
On the whole, then, the fall in prices, when considered in connection
with the other great changes which have accompanied it, does not afford
so much countenance to the bimetallist proposal as at first sight it
seems to. The rise in money incomes and the improvements in production
disprove any intolerable burden on debtors, and make it highly
improbable that the change has had any general depressing effect on
industry.
THE CASE OF THE FARMER
Nevertheless, there is something more to be said, in explanation and
justification of the discontent with falling prices, and of the silver
agitation which rests on that discontent. While the effects of the fall
in prices on debtors as a class and on producers as a whole have not
given real grounds for complaint, certain particular debtors and
producers have undoubtedly been injured. The case of these latter have
given plausibility to the general arguments of the bimetallists, and,
what is more important at the present juncture, has given strength to
the movement in the United States for more money and more silver.
The situation will be best understood if we contrast for a moment the
different modes in which the improvements in production have been
brought about in manufacturing industries on the one hand, in
agriculture on the other hand. In manufactures the improvements have
been better machinery, new processes, labor-saving inventions, the
conduct of business on a larger scale, and so the greater and more
effective division of labor. In agriculture the main cause of cheaper
production has been different: it has been the opening up of new lands
and new sources of supply. No doubt there are important exceptions to
these general statements. In agriculture there have been advances in the
arts--new plants, better fertilizers, improved implements, more
effective ways of cultivating the soil. In manufactures, on the other
hand, there have been important changes due to the discovery of new and
rich mines of materials, such as coal, iron, copper. But on the whole,
the difference holds good. In agriculture undoubtedly the opening of new
lands through the improvements in transportation has been the most
important single cause at work. The cheapening of agricultural products
has been due not so much to the more effective use of the soil already
under cultivation, as to the development of soil not formerly available
for the supply of the market.
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