But now, sir, I maintain, first, that although there is an excess of currency in the country over and above the real requirements of legitimate business, a feeling of scarcity may, nay, I say, it will, ensue as speculation expands; and, secondly, that this evil will not be remedied, but will be aggravated by inflation.
And here I will call the attention of Senators on the opposite side to the fundamental error which lies at the bottom of all their arguments. From the fact that a scarcity of currency is sometimes felt by legitimate business, they draw the conclusion that the aggregate volume of currency in the country is insufficient for the real requirements of that business. This conclusion is utterly and glaringly fallacious. Gentlemen confound two things which are essentially different from one another. One is an insufficiency of the aggregate amount of currency in the country, and the other is a vicious diffusion of that currency really sufficient and more than sufficient for all legitimate purposes. The difficulty is not that there is not enough currency on the whole; but, first, that one part of the country is not as rich as the other; and, secondly, that legitimate business is apt not to control enough of currency, because illegitimate business, speculation and gambling control too much. This is one of the evils inherent to an irredeemable and fluctuating paper money; and, I repeat, that evil not only cannot be remedied by an inflation of the same paper money, but it will be seriously aggravated by it, for the simple reason that inflation always stimulates speculation and gambling.
The Senator from North Carolina [Mr. Merrimon] having been quite prominent in this debate, I take his State as an illustration. He complains that in North Carolina the people are impoverished, that business is cramped, that banking capital is scarce, that rates of
