It may be worth mentioning that neither the retirement of existing gold coins nor the cessation of their coinage in future need be insisted upon. By a slight modification of the plan, we could permit gold coins and coinage to continue. In fact in the formulations of the plan which I usually made before the war, gold coins and coinage were retained. I then thought that the custom of handling gold coins was so firmly intrenched in some places, notably Great Britain, that the plan would be more welcome if gold coins were retained even if only as token coins.
Since then, the war itself has brought about the very retirement which we are discussing and has conquered most of the popular prejudice which stood in its way; and, from motives of economy, all nations, including Great Britain, will probably now prefer not to return to the general use of gold coins. It has therefore seemed best not to cumber the present text with the description[1] of what now proves, apparently, to be an unnecessary complication.
There is, however, a third plan possible, intermediate between the plan of the present text (in which gold coins are retired and their coinage ceases) and the plan formerly put forward (in which both coins and coinage are retained).
This intermediate plan is to authorize the retention of the existing gold coins but to stop the coinage of new coins — though retaining, of course, the unrestricted deposit of gold bullion in return for the issue of gold dollar certificates.
This third plan would seem to me to be preferable in practice to either of the other two as it would dispense with the need of recalling the few gold coins now outside of government vaults and would not involve any
- ↑ This will be found in the Quarterly Journal of Economics, February, 1913, pp. 213-235. It is interesting to observe that Simon Newcomb, one of the earliest writers who anticipated me in formulating the plan, also suggested this feature by which gold coin could be retained. See North American Review, September, 1879.
