[PDF]drew money muss

POLITICAL ECONOMY FOR THE PEOPLE.


THE WORKS OF JOHN G. DREW.


OUR MONEY MUSS:


A History of the Greenbacks and Five-Twenty Bonds,
WITH FULL DIRECTIONS HOW


TO START AND RUN NATIONAL BANKS


And Obtain Interest on $50.00 to $100.00 on Each Dollar Invested.
COMPILED FROM OFFICIAL SOUROES, BY


20 a JA — a a Ge J SO =


Author of “Our Currency as it Is and as it Should Be; ** The Absorbing Power
oS Usury,” &c., &.


Svo., paper. Price, 2O cents.





TABBED OF CONTA s's.

Conspiracy Exposed. Talk with a Member of Con Why the Greenbacksand
Five-twenties were made. How the Greenbacks and Five-twenties were made. The
Conepirators O: nize. Survey of the battle-fleld. The Battie uarely ‘un in the
House. The Battle squarely Sy oe in the Senate. Suspicious Politeness of the Spider
tothe Fly. The International Imperialism of Gold. he People Victorious— Decline
of Gold and rise of Bonds. Repudiation No. 1, by the Bullionists, of the Nation's

romise to ite ple. Cush or redit—liscussed and defined. Out of the Frying-pan

ntu the Fire—Treason and Robbery. Kepudiation No. 2, by the Bullionists, of the
Nation's promises to its people. The President repulses the Bullionists. Judas Iscuriot
as the Model Statesman. tis itt—Not Barnum's but the National Banks. How
to Make National Banks aud Contract the Caereney. How to Bun National Banks
and Contract the Currency. How Engiand dilutes ber Goldand America inflates her
Greenbacks. Blunders of a Bullionist— analysis of Wells’ “Cremation” Theory.





“a NATIONS WEALTH FOR A NATION'S NEED.”


OUT, MUR EING YX:


WHAT IT 18, AND WHAT IT SHOULD BB.


By JOHN G. DREW.
Svo., paper. Price 20 cents.


CONTENTS.

Introduction. Analysis ofthe Greenback—Its Excellences, Analysis of the Green-
back—lIts Defects. Comparison with France and England—a Self-Regulating Plan.
Senator Buckingham'’s Bill and Comments. Science Applicable to Money as to
Mechanics. A Panic Portrayed—Birth—Existcnce—Death—Cause investigated, Gold
ax before a Grand Jury—Iindicted asa Nuisance with a Debtor People. Our Money
like our other Institutions—by the People and for the People. Horace Greeley on Con-
vertible Bonds and Currency. The Critic Criticised—a iponse to the New York
Times. Our Uncle was Well—took Physic to be Better— and isnow almoat Dead. How
England got out of Debt to the Foreigner and Resumed Specie Payments. England's
Position when a Debtor Nation and Ours now,Compared. Onur late National Repudia-
tion and the Cause of{t. Where 8 per cent. ep ad and 20 per cent. Cost of Moncy
mndsus. Farmers and Railroads—both Examined. The Two Oligarches—Slave and
Money—Does History Repeat Itselft Ship-Building—How to Make it Poasible. Morul
Aspects—Are we a Nation of Boxes ?t Commerceand Ban Contrasted. Indict-
ment of our National Financiers. It must be Redeemable. nvertibility of the
Greenback. Analysis of our Present Carreney.. Cash Money vs. Credit Money. French
and American Statesmanship Contrasted. volution or Revolution. Appéndix.


THE ABSORBING POWER OF USURY:


BR, EVERY MAN HIS OWN ACTUARY.
By JOHN G. DREW.
8Svo., paper. Price 10 cents.


Zhe above Pamphict contains a number of valuable and useful Compound Inter-
est Ta

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no one should write about greenbacks without mentioning that the "fathers" of the
scheme were:


Portland Chase who used to be attorney to the Bank of the United States while it
existed; Chase went to school with the children of leading bank-friendlies like Henry
Clay and William Wirt; as young attorney, Chase was mentored by William Wirt,
attorney general in J.Q. Adams' cabinet. Wirt was attorney to, and fervent supporter of,
the Bank of the United States and opponent of Andrew Jackson; in 1832 he was Anti-
Mason Party presidential candidate


Thaddeus Stevens used to be attorney to the Bank of the United States while it existed,
he was the one who pushed through the Pennsylvania House the bill that re-chartered
that bank as a State institution


Gerry Spaulding, a banker before and after his tour of duty in the House
Erastus Corning, a "robber baron" before the term became popular, fervent Bank of U.S.
supporter, William Seward (present secretary of State) used to be his attorney


Samuel Hooper, a rich merchant who entered into politics; in 1852 he was instrumental
in enacting the Free Banking law in Massachusetts, and introducing a public debt-based,
private bank-currency there, in 1863 he and his friends applied this banking system and
bank currency to the whole union


John Sherman ---whom Drew completely leaves out of his story--- as young man was
mentored by Thomas Ewing, fervent supporter of the Bank of the United States


and, of course, the advisors of Abraham Lincoln and Portland Chase on financial
matters, August Belmont and Joseph Seligman, the real motivators behind the national
currency bank scheme


none of these people were good-intentioned, victims of scheming bankers; as
Spaulding and Sherman told us later, the greenbacks were a means to an end, not an
intended blessing to the people


noticeable:

John Drew writes in 1874, he is a friend of government-issued paper money, but in his
writings there is no mention of Lincoln, especially no mention of a Lincoln who was a
hero and caused the greenbacks to be issued (no story about Lincoln's talking to his
dear colonel Dick)


Even the Bankers' Magazine --vocal advocate of the central bank concept, gold
standard and bank-paper currency-- writing in 1896, recognized that Portland Chase
was upto something, that he had a plan, and to carry out this plan he turned from State
banks and from readily available banking practices. Where did Portland & Spaulding
acquire this novel idea of establishing a nation-wide network of currency banks (which
won't be able to go into operation until the conclusion of the war) ?

2


“Mr. George S. Coe, president of American Exchange National Bank, writing to
E.G. Spaulding, in October, 1875, recounts in a long letter the opening financial opera-
tions of the war. He said:

‘The problem to be solved by the banks was this: How can the available capital
be best drawn from the people, and devoted to the support of the Government, with the
least disturbance to the country ? These were simple questions of domestic exchange
and most naturally suggested the use of the ordinary methods of bank checks, deposits
and transfers, that the experience of all civilized nations had found most efficient for the
purpose, and that this should be accomplished by the associated banks in a manner best
calculated to prolong their useful agency and to preserve the specie standard, it was
indispensable that their coin reserves remain with the least possible change. Accord-
ingly, it was proposed to the Secretary that he should at once suspend the operations of
the Sub-Treasury Act in respect to these transactions, and following the course of
commercial business that he should draw checks upon some one bank in each city,
representing the association, in small sums as required in disbursing the amounts
loaned.’

“Congress had, on August 5, 1861, passed an Act authorizing the Secretary to
pursue this course. But, for reasons never yet accounted for, he refused to do so. Mr.
Chase insisted upon drawing the specie received for the loans from the banks and
depositing it in the Treasury and from thence disbursing the coin itself for actual
expenses. ‘This first great error,’ writes Mr. Coe, ‘if it did not create a necessity for the
legal-tender notes, certainly precipitated the adoption of that most unhappy expedient.’

“Notwithstanding this course taken by the Secretary and the disbursements of
the coin by the Government, the coin itself, while the paper currency was restricted,
came back to the banks in one week. When the first loan of $50,000,000 was made,
the banks held $49,733,999 in coin; the coin came back so rapidly to the banks that on
December 7, after the three loans had been made, the banks still held $42,318,610. If
there had been no other unwise measures, this operation of borrowing from the banks
might have been continued for some time longer, if not indefinitely, at least until the new
customs duties payable in coin had begun to arrive, and until the proceeds of the
internal revenue laws became available. The customs duties would have gradually
increased the stock of specie, and the operations with the banks would probably have
assumed larger and larger proportions.

“Tt would have been a simple operation to have obtained legislation requiring
the existing State banks to take the bonds of the United States as a basis for circulating
notes. But by elaborating an entirely new and distinct system, antagonistic to the State
banks, Mr. Chase insured the very delay that rendered his bank scheme impracticable.
Mr. Spaulding drafted the National bank currency Act, but could not as a banker avoid
being impressed by the difficulty of putting it into immediate operation. Nevertheless in
the light of the experience of the last thirty years it can be plausibly urged that if the
Secretary had suspended the sub-Treasury Act, and had dealt with the banks according
to banking methods, that coin money could have been borrowed for several months
until the bank scheme, even the ill-advised one recommended in his report, could have
been put in operation. The banks, as was subsequently shown, could easily have
issued, on a specie basis, all the currency required to carry on the war. At the same time
they could have placed all the bond issues.”


www.yamaguchy.com 3


The same Bankers’ Magazine, in July 1861, wrote that “all possible source of
revenue” are: Government loans, Treasury notes, Tariff, Taxes ---no bank-note
currency on that list, and issuing Treasury notes as a form of borrowing from the people
is on the list as a perfectly natural thing. They also wrote in 1861 that bank-note
currency based on government bonds is insecure, harmful and should not be allowed.

“The recent course of events in the States of Illinois, Wisconsin and Missouri
has demonstrated, more strongly than ever, the insecurity of the bank note currency of
those States and of other States where bank notes are issued upon the basis of State
bonds.

“We shall never have, in this country, a sound and convertible bank circulation
until the government takes the control of the currency, deprives it of all source of indi-
vidual profit, and stamps upon it the seal of government guarantee.”

“No one, conversant with the practical details of that department, entertains a
doubt of the ability of the United States Treasury to manage a government currency. It
should be based upon the prospective resources of the country, and at all times convert-
ible into coin.”

Giving the impression that in 1861, the Bankers’ Magazine considered it a
perfectly good idea that the federal government alone should issue the national
currency, in the form of non-legal-tender Treasury notes, based on the assets of the
United States, promising to pay coin. Also, that banks should not be allowed to issue
notes based on government bonds, and should not be allowed to conduct banking busi-
ness using bonds as capital. They developed their views based on the experience of the
previous sixty years. Could the 1861 Bankers' Magazine remain in business if its readers
did not subscribe to such views ?

So, whence came the idea of legal-tender U.S. Notes, a brand-new national
currency bank system, bank-notes as national currency ? Not from George Coe, not
from James Gallatin.


Po.iticAL ECONOMY FOR THE PEOPLE
Our Money Muss
A Hisrory OF THE GREENBACKS AND FIVE-IWENTY Bonps.
BY JOHN G Drew
1874


Widener Harvard Depository Econ 4618.74.11
HOLLIS Number: 005241145


General Review of the Subject.


The diverse theories now obtaining as to the characteristics of the
above-named forms of certificates of our national indebtedness, would seem
to indicate that they ante-dated Herodotus, instead of being but twelve years
old and matters of full public record.

They are both creatures of one and the same enabling act, twins, in
fact; but the greenback just about as much the elder as Esau was the senior
of Jacob. In a very large sense the comparison of twins will not hold, unless
we liken them to those of Siam. So intricately was the vital machinery of
each interwoven with the other that it would seem as if disintegration would
by destruction to each.

But, like the humane master, whose nerves shrunk from cutting off
the dog's entire tail at one blow to spare his feelings, but did it an inch at a
time, so have our legislators hacked at the unity of the creation, until now we
have a mutilated legal-tender, the laughing-stock of all civilized nations, and
the 5/20 bond, as yet undefined and indefinable, a political and financial
curiosity, compared with which Barnum's "What is it ?", or the traditional
Kentucky "half horse and half alligator" were common place.

To exhibit the utter ignorance which prevails as to the history and rela-
tionship of these forms of national indebtedness, not only among the "great
unwashed," but among those who are so distinguished by their intellectual
ability, culture and moral worth, as to be selected as the law makers of the
nation, and whose function it is especially to "see that the Republic receives
no harm," the writer of this will detail an interview with a prominent
member of Congress and president of a national bank.

The interview was caused by a visit of a constituent of the Member of
Congress to the city of the residence of the latter, and as the writings of the
said constituent on political economy had been largely quoted in Congress
and by the press, the said M.C. was desirous of making his acquaintance.

The M.C. remarked that there seemed to be a growing hostility to the
national banks, and claimed that they formed the best monetary system the
nation had ever known, to which the visitor responded that the fact of their
investment in government bonds, at a high rate of interest in gold, which,
with the premium on gold, and exemption from taxation, aggregating about


www.yamaguchy.com 5


ten per cent., being three times what the investment in productive industry
would produce, should be considered satisfactory to them. That the addi-
tional advantages of curtailment of supply of currency, their legalized
monopoly of the same, and the free gift of the use of one-half the currency
of the nation, caused people to criticise the system as class legislation, for the
benefit of the few and the detriment of the many.

The M.C. then remarked that the tendency of the west and south was
towards repudiation; to which the writer of these pages responded, that all
he had seen claimed was that the payment of the bonds should be in exact
accordance with the terms on which they were issued, and taking up
"McPherson's Hand-book of Politics for 1874," read to the M.C., from pages
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