Page:Speeches, correspondence and political papers of Carl Schurz, Volume 3.djvu/471

Rh so, like the poor, it stays all and always with us; and inasmuch as it costs almost nothing to make fiat money and we can make any quantity of it to suit ourselves, we shall get richer and richer, and there will be no end to our wealth and happiness. That is what the fiat money doctors promise us.

It will strike you that this is exceedingly simple and very fine; but you may have some misgivings, and say: “Well, this bit of paper may call itself a dollar, but it is, after all, only a bit of paper. Is there nothing of value behind it?” Whereupon the fiat money man gravely answers: “This is a great country. It has some forty or fifty thousand millions of dollars' worth of property in it. When the Government of this great country puts its stamp upon a piece of paper and thus makes it money, then that money is based upon the whole wealth of the country.” That sounds magnificently, and you may think, well, if this country has forty or fifty thousand millions' worth of property, and all that property is mortgaged as security for the value of this fiat money, why should not this security be good enough for a couple of thousand millions of fiat money? Now let us see how it will work. Such promises to pay as greenbacks and national-bank notes are withdrawn to make room for fiat money. It will not be necessary to make any provision for the withdrawal of gold and silver, for the precious metals, finding no further employment, will take leave of themselves, and go abroad, where they are wanted. Now the fiat money is master of the field. It goes into circulation, and for some time it will indeed circulate, for, it being the only tool of exchange left to you, you will have to take it and use it; it will circulate just as wampum-beads and clamshells and leaden bullets circulated for awhile as currency in early colonial times. It will also maintain a certain current value, as long as its volume is kept within