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• Translator's Preface
• Section I.: Preliminary Observations.
• Chapter I.: The Question Stated
• Chapter II.: Preliminary Observations On the Rise of Prices Which Has Characterised the Last Few Years.
• Section II.: An Appeal to Some of the Fundamental Notions Upon the Nature and Characteristics of Money.
• Chapter I.: What We Ought to Understand By Value and Price.—twofold Definition of Money.—the Standard Or Fineness of Money.
• Chapter II.: Of the Meaning of the Word Standard.— the Metal-standard Is That From Which Is Derived the Monetary Unit.—the Two Ideas Standard and Monetary Unit Imply Each the Other.
• Chapter III.: Of the Character of Exchanges As Affected By the Invention of Money —how the Rise and Fall of the Precious Metals Are Manifested In the Course of Trade.—phenomena of the Rise and Fall In Commodities.
• Chapter IV.: On the Possibility of Conferring the Quality of Standard Upon Two Metals At Once.
• Chapter V: Of the Meaning of Certain Words Specially Applicable to Money and the Precious Metals.—price, Value, Premium, Dearness, Cheapness
• Section III.: Of the Present Production of Gold and Its Outlet.
• Chapter I.: Of the Increase In the Present Production of Gold As Compared With the Past —the Extended Coinage of Gold Which Has Followed.
• Chapter II.: Diminished Coinage of Silver In France—gold Is Already At a Discount In Comparison With Silver.
• Chapter III.: Extraordinary Exportation of Silver From the Civilised Countries of the Western World Towards India and China —to What Extent It Is Likely to Continue.
• Chapter IV.: France Serves Temporarily As a Parachute to Retard the Fall of Gold.
• Chapter V.: Whether the Extraordinary Production of Gold Ought to Be Considered As an Ephemeral Accident.—the Crushing of the Quartz Veins —mines In Siberia and Elsewhere.
• Section IV.: On the New Outlet That May Be Expected For the Production of the New Gold Mines, and Whether It Will Be In Proportion to the Extent of This Production.
• Chapter I.: Of the Outlet Afforded By Those Countries Which At Present Have Evidently an Insufficient Proportion of Metal In Their Currencies.
• Chapter II.: Of the Increase of Gold Money Which May Arise From the Development of Business, and the Increase of Population.—of Wear and Tear.—of Hoarding.—of Shipwrecks.
• Chapter III.: On the Employment Which Habits of Luxury May Offer to the Gold of the New Mines.
• Chapter IV.: Conclusion of the Preceding Chapters.—the Fall of Gold Very Probable, If Not Inevitable, In Relation to All Other Commodities.
• Section V.
• Chapters I. to V.: On the Part Assigned to Gold In the Monetary Legislation of France.
• Section VI.: Consequences of the Fall In the Value of Gold.
• Chapter I.: A General Distinction Between Those Private Incomes Which Will, and Those Which Will Not Be Affected. of a Certain Collective Loss Which the People of France Will Suffer.
• Chapter II.: Of the Sufferings and Difficulties Which Will Accompany the Transition.
• Chapter III.: On the Gain Which Would Result to Certain Classes of Persons, and to Society, From the Fall In Gold. the Saving to the State From the Payment of the Dividends On the Public Debt.
• Section VII.: Of the Measures to Be Taken to Avert the Evil Effects of the Fall of Gold.
• Chapter I.: Case of a State Like England, Where Gold Is the Standard, and Where There Is No Other Money But Gold.
• Chapter II.: Case of a State Such As France, Where There Is a Silver Standard, But Also a Gold Currency.
• Chapter III.: The Measure Here Recommended Is a Necessary Complement of the Law of Germinal, Year XI.
• Chapter IV.: On Some Inconveniences Inherent In the Combination, Respecting a Gold Currency, Recommended In This Work.
• Chapter V.: Of a Plan Recommended For Maintaining the Parallel Circulation of Silver and Gold.
• Chapter VI.: Of the Resolutions of a Commission Appointed By the Minister of Finance In Mdccclvii.
• Chapter VII.: Of Various Acts Which the Legislation of the Ancient Regime Upon Money Treated As Crimes, and With Regard to Which Some Persons of Our Day Propose to Establish Penalties. —selecting, and Melting; Trade In Coins; Exportation.
• Chapter VIII.: Of a Different Solution Which Has Been Recommended, and Which Would Consist In the Adoption of a Gold Standard.
• Chapter IX.: Appreciation of the System Which Consists In Adjourning Indefinitely the Legislative Solution.

CHAPTER III.

on the gain which would result to certain classes of persons, and to society, from the fall in gold. the saving to the state from the payment of the dividends on the public debt.

We have explained, rapidly and incompletely, the deplorable consequences which a fall in the value of gold would entail. It is right to examine whether this revolution would not also present some results of an advantageous character. There is one very easy to comprehend; supposing that the fall of gold be to the half of its value, a proportion that I enounce solely by way of example and for clearness of illustration, it will follow that, at the end of a given time, the raw material of certain articles of luxury, altogether made of gold, will have fallen one-half. Then we shall be able to strike our gold medals at a cheaper rate; the gold snuff-box will be a luxury within the reach of a greater number of purses; and our Cræsuses will be able on their fête-days to adorn their sideboards a little more easily with cups of gold. I say a little more, and that is all; for in these objects the art and design, which form a considerable part of the price, will not have fallen, but the contrary; the fall will be confined to the raw material. Still clearer is it that gilding will not experience a great reduction, for it is not the weight of gold employed in it that constitutes its chief expense. I see no other permanent advantages which a people, free from the burden of a heavy national debt, can hope to derive from this depreciation of gold, after the epoch when the crisis of the transition shall have passed. The advantage is not great, it must be confessed. There are few articles in which a fall to the same extent would not be a greater benefit. What a contrast, for example, with the service that would be rendered to all classes of society by a reduction of one-half in the value of coal or iron, or even of copper or lead! I do not speak of bread or meat, in which a reduction of price to the same extent would produce incalculable effects.

Independently of the facilities which the fall in the value of gold would afford for procuring plate and articles of luxury, into the composition of which this metal enters, a certain compensation must be noticed, which would not be unimportant. Having indicated the classes which would suffer from the fall of gold, it must be added that there would be gainers as well as losers. If the creditor be obliged to give a discharge, on receiving a value smaller than that for which he believed himself assured,—if, for example, the 100 pounds sterling paid to him represent only the enjoyments which he would have previously procured for fifty, he is assuredly a loser; but the debtor benefits to the same extent. The 100 pounds sterling which he will have repaid, will have been procured with one-half less labour or privations. Against the majority of the losses which we have enumerated, there will, then, be a set-off of gain of the same importance. On this point two questions arise, which deserve our attention: the one is whether for society, taken in its mass, there is compensation; and the other, whether equity sanctions the loss which the one suffers, and the gain which the other acquires.

On the first subject, I shall only add a word to the remarks I have already submitted to the reader. Changes which affect deeply, and suddenly, or in a brief interval, a very great mass of interests, are nearly always to be regretted, even when at the same time, and by the same act, a considerable number of persons find themselves deriving advantages. It is for society a perilous trial, especially when the working' population find themselves among the number of the suffering classes; it is, in fact, they to whom patience is most difficult, since they possess the fewest resources. Society would, under these circumstances, have to pass through an ordeal, which, I think, I have justly characterised as revolutionary. If the qualification be just, it enables us to appreciate all the dangers of the transition. With skilfulness, and in a season of tranquillity, a people may pass without disaster through such a trial; but it requires also good fortune. Now, can any one, without presumption, flatter himself that he will possess at any one moment, and enjoy during a succession of years, these three gifts of heaven—tranquillity, skill, and good fortune?

Let us rather insist on the second question, that of equity. It is not without its bearings on the first; for when events are in conformity with right, it is in human nature generally to resign itself to them. On the contrary, indignation and resentment easily take possession of a man when he feels that justice is violated in his person.

Among the results which may be expected to arise from the fall of gold in those countries where this metal forms the sole or the dominant currency, I will recur to one of the most important for the purpose of examining it from an equitable point of view; I return to the case of a proprietor of government stock. Let us suppose the case of an inhabitant of London, living on an income of £1,000 a year from Consols. During and after the depreciation of gold, as well as before, he will receive his 1,000 discs of metal, containing, altogether, 7 kilogrammes and 318 grammes of fine gold; but with this sum he will have only the half of the enjoyments which he possessed previously. Is there or is there not in such a diminution of subsistence anything which can be taxed with spoliation? I do not think there is, in the case of England. For what is the engagement into which that State has entered? By the very fact that England has a gold standard, the creditor to whom the British government owes a pound sterling can claim no more than the quantity of gold, to which the law, once for all, has attached the denomination of a pound, that is to say, 7 grammes, 318 milligrammes. The State is bound to furnish to the creditor for a pound this quantity of metal; it has, strictly, no other obligation. If in paying the British creditor in former times, when the value of gold rose in proportion to other commodities, the government had attempted to deduct from the dividend 2 or 3 per cent, or more, it would have been denounced as an act of spoliation. In the possible case that the mines of Australia, California, and Northern Russia had remained undiscovered till half a century later, and that the productiveness of the old mines had diminished, the English government would not have been justified in reducing the amount of interest, and paying only three-fourths or two-thirds of a sovereign instead of a whole one, under pretext that gold had risen in proportion. The law is the same for the debtors as the creditors. The latter have no claim beyond the quantity of gold which has been agreed upon as forming the pound sterling, if gold, instead of rising, should fall in value. The two parties have run the risk of a variation in the value of gold; and to whichever side the chance turns there is a legitimate profit. Thus, for England, which has the gold standard, strict equity is not violated by the change, unlucky though he be who may prove to be the creditor of the State. There remains, however, a question of social and political propriety on which we shall afterwards offer some observations.

Would the case of France be similar to that of England? Would the former State, by the letter of the law, or in equity, be warranted in profiting by the fall of gold, and paying its debts in a cheapened currency? Can it take advantage of the circumstance, that the 29 centigrammes of gold which in the year 11 were equal to 4½ grammes of fine silver, constituting the franc, appear now for the moment to be of much less value, to pay its creditors in gold? This is a question of good faith, the solution of which, after the statements already submitted, ought not to be very difficult. It would be a violation of justice, because France has a silver standard. In the French currency, silver, according to the preamble to the law of the year 11, is the fixed point, and this fixed point is the guarantee of the equity and honesty of transactions, the security for the preservation of property. Nor is it possible to swerve from this fixed point, without wanting in probity, the rules of which States are bound, even more than individuals, to observe.

If silver had fallen in value, the French government would have been justified in paying its creditors in silver as before. It is in silver that the agreement has been made. The law has declared, once for all, that 4½ grammes of fine silver shall make a franc, neither more nor less. Thus, as was declared by Gaudin, in a passage which I have already quoted more than once:—” He who shall lend 200 francs can at no future time be repaid with less than a kilogramme of silver,* which shall always be worth 200 francs, and never be worth more or less,”

Nobody can say that some day silver may not also undergo a great fall, brought about by a production which should be distinguished by the two following characteristics: of being much greater in comparison with the employments to which it had hitherto been applied, and of being produced under more favourable circumstances, that is, at less cost per kilogramme for the metal obtained. There are strong reasons for thinking that if the United States annexed Mexico, and penetrated further into the regions of Central America, this event would not be of tardy accomplishment, under the auspices of a race so industrious and so enterprising as the Anglo-Saxons,†

It may be doubted, however, whether, unless under circumstances of a most extraordinary character, the change in the case of silver could be so sudden as it has been in that of gold. The nature of the argentiferous deposits, the obstacles they offer to the miners, and the complicated processes by which the metal is abstracted from the ore, combine to reject the hypothesis of a rapid change in the value of silver. Nevertheless, a fall in silver is an event to be anticipated, an event even probable at no very distant date, and it offers to the French government a chance, and the only one, of profiting legally at the expense of its creditors.

Owing to the discovery of the new gold mines, (if those mines should continue to be what they have been up to the present day,) a time will come when a change will come over the British treasury, as If some genii, an enemy of its creditors, had spirited away their dividend warrants, and substituted others of only half their value. Not that the number of pounds sterling due to them as principal, and of which the interest is counted to them every six months, will be diminished; not that the quantity of gold contained in the pound sterling will be lessened; but the British treasury will henceforth draw from the taxpayers' each pound sterling, with as little difficulty to them, as it previously took to pay a half sovereign; and the unlucky fundowners will obtain for the pound only half of the enjoyments which it now procures for them; and yet, in strict right, they will have no reason to complain. As for the French treasury, it will have no right, unless by a flagrant iniquity, to expect any similar profit from the discovery of the new gold mines.

SECTION VII.

of the measures to be taken to avert the evil effects of the fall of gold.

[*]Of the standard of nine-tenths fineness.

[†]I have alluded to this subject in the third volume of my Political Economy, Section III., Chapters I. and II.