common sense of mankind; and, as is usually the case, that to which men are prompted by a sense of their own interests, is far more nearly right than that which is taught by philosophers who look inward to their own minds for the laws which govern man and matter-refusing to study the movements of the people by whom they are surrounded.

The uninstructed savage finds in the waterspout and the earthquake the most conclusive proof of the wonderful power of nature. The man of science finds it in the magnificent, but unseen, machinery by means of which the waters of the ocean are daily raised, to descend again in refreshing dews and summer showers. He finds it, too, in that insensible perspiration which carries off so nearly the whole amount of food absorbed by men and animals. Again, he sees it in the workings of the little animals, invisible to the naked eye, to whom we are indebted for the creation of islands elaborated out of earth that has been carried from the mountains to the sea, and there deposited. Studying these facts, he is led to the conclusion, that it is in the minute and almost insensible operation of the physical laws he is to find the highest proof of the power of nature, and the largest amount of force. So, too, is it in the social world. To the uninstructed savage, the ship presents most forcibly the idea of commerce. mere trader finds it in the transport of large cargoes composed of cotton, wheat, or lumber; and in the making of bills of exchange for tens of thousands of dollars, or of pounds. The student of social science, on the contrary, sees it in the exercise of a power of association and combination resulting from development of the various human faculties, and enabling each and every member of society to exchange his days, his hours, and his minutes, for commodities and things to whose production have been applied the days, the hours, and the minutes of the various persons with whom he is associated. For that commerce pence, sixpences, and shillings are required; and in them he finds willing slaves, whose operation bears to those of the ship the same relation that is elsewhere borne by the little coral insect to the elephant.

The

It is by means of combination of effort that man advances in civilization. Association brings into activity all the various powers, mental and physical, of the beings of whom society is composed, and individuality thus grows with the growth of the power of combination. That power it is which enables the many who are poor and weak to triumph over

the few who are rich and strong; and therefore do men become more free with every advance in wealth and population. To enable them to associate there is required an instrument by help of which the process of composition, decomposition, and recomposition, of the various forces may readily be effected; so that while all unite to produce the effect desired, each may have his share of the benefits thence resulting. That instrument was furnished in those metals which stand almost alone in the fact, that, as Minerva sprang fully armed from the head of Jove, they, wherever found, come forth ready, requiring no elaboration, no alteration to fit them for the great work for which they were intended, that of enabling men to combine their efforts for fitting themselves worthily to fill the post at the head of creation for which they had been designed. Of all the instruments at the command of man, there are none that tend, in so large a degree, to promote individuality on the one hand, and association on the other, as do gold and silver-properly, therefore, denominated the PRECIOUS METALS.*

* Recent American experience furnishes, as we think, proof conclusive of the accuracy of Mr. Carey's views above presented. Notwithstanding the gigantic character of the existing civil war, the rate of interest is low, the societary circulation is great beyond all precedent, the people are, to an extent never before known, free from debt, and the reward of labor is large. Why is it so? Because, for the first time in its history the country has been supplied with machinery of circulation in quantity adequate to the performance of the work that needed to be done. The government has furnished this, and the people pay for the use of this machinery precisely as they would do were it composed of the precious metals; doing so for the reason that all have perfect confidence in the responsibility of the party by whom it has been supplied.

CHAPTER XXVI.

OF THE INSTRUMENT OF ASSOCIATION-CONTINUED.

IV. Of the Trade in Money.

1. The precious metals the only commodities of universal acceptance, being the indi pensable instruments of commerce.

2. Proportion borne by money to the amount of commerce increases in declining countries and decreases in advancing ones.

3. Centralization, retarding the societary motion, increases that proportion. Decentralization diminishes it. Man then becomes more valuable and more free.

4. Money being the one indispensable instrument of society, governments have always assumed to control its management, as supplying the most productive of all the machinery of taxation, Falsification of money by European sovereigns.

25. Banks established with a view to the emancipation of the currency from the control of governments. Deposit banks of Italy, Germany, and Holland. Institution of banks of discount.

26. Enlargement of the operations of discount banks.

7. Banks of circulation commence with the Bank of England.

28. How the expansions and contractions of banks affect the societary movement. 29. Great power of banks for good or evil. Banking monopolies, like those of France and England, give to a few individuals a power over the societary movement compared with which that exercised by the sovereigns of old sinks into insignificance.

§ 1. THE single commodity that is of universal demand is money. Go where we may, we find hosts of people seeking commodities required for the satisfaction of their wants, yet widely differing in the nature of their demands. One needs food; a second, clothing; a third, books, newspapers, silks, houses, cattle, horses, or ships. Many desire food, yet while. one would have fish, another rejects the fish and seeks for meat. Offer clothing to him who sought for ships, and he would prove to have been supplied. Place before the secker after silks the finest lot of cattle, and he could not be induced to purchase. Among all of these, nevertheless, there would not be found even a single one unwilling to give labor, skill, bonds, lands, horses, or whatsoever other commodity might be within his reach, in exchange for money-provided, only, that the quantity offered in exchange were deemed sufficient.

So, again, if we look throughout the world. The poor African searches anxiously in the sands for gold, while the yet poorer Lapp and the wretched Patagonian-almost the antipodes of each other-are alike in the fact, that they are ready, at any moment, to exchange their labor and its products for either of the precious metals. So, too, has it been in every age. The Midianite merchants paid for Joseph with

so many pieces of silver. Rome was sold to Brennus for gold. That of Macedon bought the services of Demosthenes; and it was thirty pieces of silver that paid for the treason of Judas. Sovereigns in the East heap up gold as provision against future accidents, and finance ministers in the West rejoice when their accounts enable them to exhibit a full sup'ply of the precious metals. When it is otherwise-when, because of war, or of other circumstances, the revenue proves deficient the highest dignitaries are seen paying obsequious court to the controllers of the supply of money. So, too, when roads are to be made, or steamers built. Farmers, contractors, and stock-holders, then go, cap in hand, to the Croesuses of the great cities, anxious to obtain a favorable hearing, and desiring to propitiate the men of power by making whatsoever sacrifice may seem to be required.

Of all the materials of which the earth is composed, there are none so universally acceptable as gold and silver. Why should it be so? Because of their having distinctive qualities that bring them into direct connection with the distinctive qualities of man-facilitating the growth of association, and promoting the development of individuality. They are the indispensable instruments of society, or commerce. Therefore it is, that we see them to have been seized upon by the class that lives by virtue of the exercise of their powers of appropriation, as furnishing the most efficient of all the machinery of taxation.

§ 2. In the infancy of society, when poor and scattered men are compelled to limit themselves to the cultivation of the least fruitful soils, the quantity of money in use, trivial as it is, bears a large proportion to the commerce that is maintained. Among the Altai mountains, an ounce of silver purchases 250 pounds of beef, while on the Pampas of Buenos Ayres a pound of gold exchanges for horses that count by thousands. The recipients of these precious metals wrap them up with care, hoping never to have occasion to cause them again to see the light. In such cases, the utility of money is very small, but its value is very great. With increase in the power of association the former rises, but the latter falls; and with every stage of progress the quantity of money bears a diminishing proportion to the exchanges performed, as is proved by comparing the amount used in the great centres of trade for effecting operations that count by almost hundreds of millions daily, with that required in

India or Peru, where, society being torpid, each exchange must be accompanied by delivery of the coin needed for its accomplishment. Here, as everywhere throughout nature, increase in the rapidity of motion is attended by decline in the proportion borne by the material that is used to the effect that is produced.

§ 3. Centralization, whether political or trading, tends to retard motion and thus to increase the quantity of money required for carrying on any given amount of commerce. The heavier the taxation the larger will be the quantity of coin always on the road to the treasury, and the longer the time that must elapse before, if ever, it returns to the place whence it had been sent. The greater the distance between the farmer and the artisan the heavier are the charges, the slower are the exchanges, and the greater the need of the banker's services. Every increase of taxation, and every increase in the necessity for transportation, tends, therefore, to diminish the power to cultivate the richer soils, while increasing the proportion borne by money to the amount of

commerce.

Decentralization, or the establishment of local centres of action, tends, on the contrary, to increase the amount of commerce while diminishing the quantity of money required, and to diminish its value while increasing its utility. With every step in this direction there is an increasing tendency to steadiness in the value of the precious metals. The fluctuations of new settlements are, as is well known, exceedingly great. At one moment, money may be hired at 8 or 10 per cent.; at the next it commands 40, 50, or 60 per cent. the one, produce is high in price; at the other, it falls so low that the farmer and planter find themselves reduced to bankruptcy.

At

§ 4. The tendency of gold and silver towards steadiness in value constitutes their principal recommendation for use as standards with which other commodities may be compared; and were the trade in money free from interference, they would be almost as perfect in that respect as are the yardstick and the bushel as measures of length and of capacity. The corn and sugar in market in any year being consumed within the year, a failure of crop may make a change of even a hundred per cent. in the price; whereas, the quantity of gold and silver always in market being hundreds of times