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rency, and the discredit e government arising from the uncertainty of a favorable issue to the contest; the derangement of the national industry, first by the outbreak of war, and then by the return of peace; the creation of an immense national debt, and the establishment of a system of taxation of corresponding magnitude, — all these, in their various and multiplied phenomena, have been exhibited upon a scale more stupendous than ever known before in this or any other country.

Scarcely a principle of Political Economy but has received a striking elucidation in our recent national experience. Many questions, once in dispute, have been settled beyond controversy. That prices depend, other things equal, on the quantity of currency in use; that the wages of labor neither rise as rapidly or as high as commodities, when that rise is occasioned by an expansion of the circulating medium; that gold, when demonetized, ceases to be the standard of value, these, and many analogous questions, have been illustrated by the financial operations of the government in such a manner that there is now no longer occasion for a difference of opinion.

But much is yet to be learned from the events of the future. The government and the banks must, sooner or later, resume specie payments. To accomplish this, contraction must be carried to such an extent as to bring the currency down to its natural volume. As a consequence, prices must fall to their normal rates. All this will cause as great changes, reversed in their effects, as followed the expansion of 1863-4, and while not a dollar of property will be destroyed, or the wealth of the nation be at all diminished, all commodities must be reduced to their actual worth in the commerce of the world. This will bring the industry of the country into a healthy condition, and give to the laboring classes a large addition to their incomes, when computed in those things upon which they subsist.

This restoration of the standard of value will terminate

all dispute as to the manner in which the bonds of the government shall be paid, since there will then be but one currency for the rich and the poor, the capitalist and the laborer, the bondholder and the taxpayer. The government will then be able to consolidate its debt at a low rate of interest, either with or without liability to State and municipal taxation, as it shall deem best. All financial controversies will thus be ended: the industry of the nation, having a sound standard by which to measure its products, will enter with full advantage into the universal competition of trade.

All this must follow from resumption, yet it cannot be accomplished without inconvenience and loss to those connected with the business affairs of the nation. That cannot be helped. It is the inevitable consequence of such a contravention of the laws of wealth as the passage of an act making the promises of the government a legal tender must necessarily occasion in the final result; yet every day's delay enhances the difficulty, and increases the demoralization inseparable from the existence of a false measure of value.

The labor movement, which scarcely attracted attention when this work was first issued, has grown to most formidable dimensions. Working-men have met in numerous conventions throughout Europe and this country, and discussed with great earnestness the various questions connected with their peculiar interests and relations. It is a matter of sincere congratulation that the tone of these conventions, at first violent and unreasonable, has gradually become more consonant with the true interests of both capital and labor. The utility of strikes is no longer advocated, and the use of coercive measures is condemned; while the expediency of co-operation for purposes of trade and industry is being more and more insisted upon and practically adopted.

The trade of the country, so sadly interrupted by the

events of the last seven years, demands the early attention of Congress. Seldom has the mercantile marine of any nation been more largely reduced, or its commerce more generally deranged than that of the United States by the devastations of war and the contemporaneous acts of the law-making power. Heavy and indiscreet taxation, joined with the paralyzing effects of a greatly depreciated currency, have nearly put an end to ship-building, once a thriving and important branch of industry; while the onerous, discriminating duties placed upon foreign merchandise has greatly diminished the trade and lessened the prosperity of the nation.

In view of the facts we have enumerated, it does not appear probable that the questions of Currency, Trade, Taxation, and Wages will lose any of their interest for many years to come. Indeed, if we judge aright, Political Economy is likely to be studied with greater interest by all classes of citizens in the future than it has been in the past.

NORTH BROOKFIELD, MASS., November, 1868.

A. W.

PREFACE.

In the preparation of the following work, it has been my hope, while furnishing a Manual of Political Economy, which should present clearly and intelligibly the leading principles of the science, to afford a full and thorough analysis and description of the different currencies used in the commerce of the world, especially to exhibit the nature and effects of the mixed-currency system of the United States.

Regarding the instruments of exchange as essential, not only to the largest production, but to an equitable distribution and advantageous consumption, of wealth, I have long felt that a work was needed which should give more prominence to the subject of money and currency than it has heretofore received. I have searched in vain for any work on Political Economy, domestic or foreign, which even attempted such a complete view of the monetary question, in all its bearings, as it appears to me to demand. Especially does such a work seem to be called for at the present time, when there are more conflicting views and wider differences

of opinion among professors of economic science on this subject, and more popular ignorance and misconception, than on any other. To pass lightly over a matter so important, so interwoven with all the great interests of society, has seemed to me a great wrong to those who, as scholars, are expected to prepare themselves for active duties and responsible positions, and, as citizens, are to decide by their votes the financial policy of the country.

In 1857, I endeavored, in a series of articles upon Political Economy, in the (New York) "Merchants' Magazine," to show the nature and effects of mixed currency, and its practical influence upon trade and industry. This, so far as I know, was the first attempt of the kind. These articles, in connection with other matter appertaining to the same subject, were published in pamphlet form in December of that year. In 1859, a small but excellent work on Political Economy appeared, from the pen of Professor Bascom, of Williams College, presenting the currency question with great correctness, but with such brevity as not, in my view,, fully to meet the wants of the public. Within the present year, and since this work has been mostly in manuscript, a manual has been published by Professor Perry, also of Williams College. It is a work of great merit; the chapter on Foreign Trade being the most able essay upon that subject which has fallen under my observation. The work contains sound views in regard to currency, and a more extended discussion than any that has preceded it; yet it does not give so full analysis as I had already prepared, such as it seems to me one work, at least, should contain.

* Walker on Money and Mixed Currency, 83 pp.

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