Schoeck_2010_EnvyATheoryOfSocialBehaviour.pdf

GOLD-THE BOGEYMAN
In order to understand why the silver question was so hotly disputed in
the United States of 1896, we must take a brief retrospective look at the
currency question. Until approximately the middle of the last century,
silver was the chief currency. England, however, had already introduced
the gold standard in 1816, and the champions of bimetallism in America
were only too ready to play up nationalist, anti-British sentiment. Since
the discovery of America silver production had usually been thirty or
forty times that of gold. The United States had become the principal
silver producer. When, with the founding of the Union, Americans had
to institute a mint and their own currency, they decided on double-standard
currency. That is to say, by Federal law, gold and silver were
established as legal and unrestricted currency, at a fixed ratio of 15 or
16 to 1. Anyone possessing gold or silver could take it to the mint and
have it coined as legal tender. The system obtained from 1792 to 1873.
During that time, the only point of dispute was the fixed ratio between
the two metals.
But in 1873 there occurred the 'crime of 1873,' as it soon came to be
called. The United States went over to the gold standard, which allotted a
restricted role to silver coin. The decision had been brought about by the
1867 Paris Currency Conference, where the majority of the twenty
nations taking part declared in favour of the gold standard. By 1874 not
only the United States, but Germany, Norway, Sweden, Japan and
Holland had also gone over to it. Increased gold output and the discovery
of considerable gold deposits about the middle of the century had made
the move seem even more expedient.
Now the United States, after the Civil War, was already in a state of
monetary transition. Different kinds of bank notes and currency were in
circulation whose value was uncertain and varied according to locality.
Only eight years after the end of the Civil War, the United States, the
world's biggest silver producer, suddenly went over to the gold standard.
The white metal thus lost its status. To the layman it was a very
disturbing event and one which could easily be made to look like the
cause of the already perilous economic position of the farmers. The
producers of silver naturally did everything they could to strengthen that
impression. To the debt-ridden farmers and small businessmen it seemed
as though the suspension of double-standard currency was compelling
them to meet existing commitments with money that was steadily
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