this paper, and in some of the others contained in this volume, which is entirely reliable and impartial, will contribute to dispel the many mistakes that prevailed in the presidential canvass of 1896.

Mr. Kennedy's Misstatement.-To show my impartiality in this matter I will state that when my attention was called, during the last political canvass, to an affidavit signed by J. H. Kennedy,' who called himself a resident of the town of Sinaloa, Mexico, to the effect that the United States silver dollar could not be exchanged for two Mexican dollars in Mexico; that the national debt of Mexico was not paid in gold, and that Mexico could redeem her debt at once without any difficulty, I had no hesitation in correcting those misstatements, as appears from the following letter that I addressed on September 27, 1896, to Mr. Arthur E. Fletcher, of Milwaukee, in answer to an inquiry from him on the subject. My letter was

1 Mr. Kennedy's affidavit is the following, taken from the Times of Minneapolis, Minn., of October 12, 1896:

'Silver Dollars in Mexico.-J. H. Kennedy, a former resident of Iowa, has attacked the statement so generally made regarding Mexico and silver by making the following affidavit before E. H. English, a notary public at Valley Junction:

"I, James H. Kennedy, now a resident of the town of Sinaloa, Mexico, do solemnly swear that I am an American by birth; that I served three years in the Seventh Iowa during the late Civil War; that I have always been a republican; that I have resided in Mexico for twenty-five years; that I speak the Spanish language as well or better than I now do the English. I have travelled through twenty-four of the twenty-seven states in Mexico in an official capacity and as an interpreter for numerous syndicates. I have had access to almost all the archives of that country. I am better acquainted with the customs and usages of that country than I am of my mother country. I left Mexico on the 2d day of March, 1896, coming to this country to visit my friends, relatives, and old comrades. During the last month in Iowa I have heard more absurd and utterly false statements made in regard to Mexico than I ever thought could be conjured up by mortal man, all to deceive the voter.

"One most heard is that you can take one American silver dollar into Mexico and get two Mexican silver dollars for it, or that you can get a 50-cent meal and throw down an American dollar and they will give you back in change a Mexican dollar. I brand this as utterly false in every respect, a lie manufactured out of whole cloth. I assert that a Mexican will not accept an American dollar, either gold, silver, or paper, for any amount, but will refer you to a broker, where you can sell your silver dollars as bullion for Mexican money; then they will trade with you. The largest hotel in the City of Mexico will not accept American money under any circumstances, but will invariably refer you to a broker.

"By paying the mintage any one can take silver bullion to either of the mints in Mexico and get Mexican silver dollars for it, and for two hundred and fifty years silver bullion has never fluctuated to exceed two cents.

"I hear it asserted that the national debt is payable in gold. I brand this as utterly false. Every dollar of the debt, $46,000,000, is, and always has been, payable in the lawful money of that country, and we are now paying our debt in Mexican silver dollars, the money of the contract.

"I assert that Mexico in the present decade is making strides in advancement

published by the Milwaukee Sentinel on the 4th of the following October, adding to my name the prefix of "Minister of the Mexican Republic" in Washington, an official designation which I never use and which is not correct, because the official name of Mexico is the "United States of Mexico," not "Mexican Republic."

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The following is a copy of my answer to Mr. Fletcher:

'WASHINGTON, D. C., September 27, 1896.

'Mr. Arthur E. Fletcher, Plankington Bank, Milwaukee, Wis. :

"DEAR SIR :—I am in receipt of your letter of the 25th instant and in answer have to inform you that the President's Message, read to the Mexican Congress on the 16th inst., explains fully the case you mention. Our gold debt, or foreign debt, as we call it, because all of it is held in Europe, amounts to more than $100,000,000, and is payable in gold, both interest and principal, and our silver debt, a large portion of which is held in Europe and some of it in Mexico, is payable in silver, both interest and principal.

"I doubt very much whether Mexico could pay her whole debt even in silver, because that would require about $200,000,000, and our revenue is only about $50,000,000 and the expenses reach about the same amount, but it might be redeemed by issuing new bonds with less interest, and that is very likely what will be done by Mexico at the proper time. I am, very truly yours, M. ROMERO."

Official Declarations of Mexico on the Monetary Question.-One of the objects for which the International American Conference that assembled in Washington in 1889 and 1890 was convened, under Act of Congress of May 24, 1888, was (Section 6th) "the adoption of a common silver coin to be issued by the different Governments, the same to be legal tender in all commercial transactions between the citizens of all the American States." A committee was therefore appointed to consider the subject of a Monetary Union, and not being able to agree upon any project with such purpose in view, because the United States delegates did not favor any, the committee decided to recommend the convening of a Special Commission of the American nations for the purpose, a recommendation which was finally adopted, because the other American nations considered that the United States being the largest of the American countries, ought to take the lead, and the others ought not to act in opposition to its wishes and policy. greater than any other nation on earth. Twenty-five years ago we had eighty miles of railroad, now we have near eight thousand miles of railroad. We are building factories on every hand. Twenty-eight years ago, when the French army was driven out, the Mexican government was left penniless-not a dollar in the treasury. We can now pay our entire national debt any day a demand would be made for it.

"I am now on my way to Mexico to spend the rest of my life. Any one can find me by addressing a letter to James H. Kennedy, Sinaloa, Mexico.

"In conclusion, I invite an honest and thorough investigation into the facts of my statement, and I defy successful contradiction. I am not the owner of mining stocks and no personal interest has caused me to make this statement, but have given it by request of an old comrade. JAMES H. KENNEDY."

During the discussion of that report I suggested the adoption of a common coin by all the American nations, to be legal tender in payment of all debts, and the coining of a certain amount of silver dollars of the same weight and fineness, to be issued in proportion to their population-for instance, $1 for each inhabitant that each country had,—such dollars to be legal tender for the payment of all debts of all the American nations, redeemable on presentation in gold by the respective countries and stated the inconveniences that would accrue to Mexico by the adoption of a common silver coin. '

When the Special Commission of the Monetary Union assembled in Washington from January 7 to April 4, 1891, it appeared that the

1 I expressed on that occasion the willingness of Mexico to agree to a common silver coin of the same fineness and weight, to be legal tender in all American nations, if they all should accept that agreement, notwithstanding the great drawbacks that Mexico would suffer in that case. In the remarks that I made before the Conference in the meeting of March 27, 1890, when the Monetary Union recommendation was discussed, I said on the subject what follows:

"It would be difficult for the American nations to agree that the international silver dollar should have the same fineness and weight as the Mexican dollar, because in that case they would create a coin of more value than their own. And this would necessarily have to be depreciated if they should accept the same fineness and weight as that of the dollar of the United States of America, which is substantially the same as that of several other of the American States. Then we should have in Mexico two silver coins; the international one, with the weight and fineness which should be agreed upon, and the Mexican one with higher weight and fineness. This difference in weight and fineness in two coins of the same nominal value, coined in the same country, could not but cause serious embarrassments. Notwithstanding all this, Mexico, wishing to contribute as far as it is in her power, and even at the expense of any reasonable effort, to the unifications of institutions and interests with all the other American Republics, has been disposed to accept the coinage of an international silver coin, without undervaluing the fact that any step towards increasing the value of silver will finally be advantageous to us.

"

My opinion on the rehabilitation of silver by the United States was expressed in the following words :

"This gentleman fears that if an international silver dollar should be coined by all the American nations, that coin would come to the United States to be exchanged for gold, and that in that way all the gold now in the Treasury should be lost and the United States be obliged to give up their gold standard and become monometallist. In my opinion this fear is ungrounded, because the United States buy from the American nations to the amount of several millions of dollars in raw materials, and the difference between the amount bought and the American goods exported to those countries, which is paid by them in cash, could be paid in international silver coin which they might receive. Besides, we could agree, as the Latin Monetary Union did, that each American nation should be bound to redeem in gold the international silver dollar that each might coin. If the basis for coinage should be as the minimum one dollar per each inhabitant in each country, there should be a demand at once for 120,000,000 ounces of silver, which would necessarily increase the value of this metal and have a very great moral influence in the solution of this problem by the other commercial nations of the world."

American delegates would not be in favor of any Monetary Union among the American nations, and that the only way to overcome the difficulties of the case was to recommend the meeting of a Monetary Conference, where all the nations of the world should be represented, which motion was adopted, and led to the meeting of the Monetary Conference which assembled at Brussels from November 22d to December 17th, 1892.

At the fifth meeting of the American International Monetary Commission, which took place on March 30, 1891, I delivered an address in which I again stated the position of Mexico so far as monetary matters were concerned, and foreshadowed the same views expressed in my answer to Senator Morgan, and in my paper published in the North American Review for June, 1895. That answer will be found in an appendix to the present paper.

The American countries have different kinds of coin. Venezuela for instance, has as a monetary unit, the Bolivar, equal to a franc, and other countries have two kinds of dollars, peso duro, and one of less value called peso feble, and in each country the dollar has different names. In Ecuador it is called Sucre, in Peru, Sol, in Bolivia, Boliviano, and in Brazil, Milreis. The weight and fineness of the silver dollar varies in almost every one of them: some have 9/10 of silver and 1/10 of alloy; others have less, and others, like Mexico, more than that proportion, and it would be of great advantage if the coins of all American nations, by having the same fineness and weight, should be of the same denomination and value.

Mexican Opinion Favorable to the Silver Standard.-Everybody in Mexico, that is, from the educated to the ignorant, from the rich to the poor, from the natives to the foreigners, and even the bankers' who in other countries are decidedly favorable to the gold standard,

'This assertion is confirmed by the following extracts from an editorial of the Mexican Herald, a newspaper published in English in the City of Mexico by very able American editors, in its issue of November 4, 1897.

Mexican Bankers and Silver.—Why are our great bankers so loyal to the cause of silver? Why are they not gold monometalists as are the bankers of England, the United States, and the continent of Europe? It is because they are not merely bankers; they are heavy investors and directors in new manufacturing industries dependent for their prosperity on the continued use of silver as money in this country. They take a broader view of the currency situation than do bankers abroad, because they are factors in a great manufacturing movement, which has for its ultimate purpose the achieving of Mexico's industrial independence.

"Being something more than lenders of money, they are liberal in their ideas and are not blinded by prejudice. They can see all sides of the currency question. There are many able and sagacious men among the bankers of Mexico and they are, with hardly an exception, bimetallists. They are not trying to make money dear, they are not wrecking properties, but rather are creating industries.

are all in favor of silver. The Government holds the same opinion. As Mexico is now prosperous a large portion of the people attribute its prosperity to the silver standard and are therefore decidedly favorable to the continuance of that standard.

It is not strange that Mexicans think so when prominent and able foreigners living there hold the same opinion.

Mr. Lionel E. G. Carden, the very able British Consul at the City of Mexico, who has been in Mexico for nearly eighteen years and understands the country well, has expressed official views on this subject which go much further than my own. He holds that, while the first effects of the depreciation of silver on the Mexican Government and on the Mexican railroads were unfavorable, the ultimate result will be beneficial and will tend to increase the country's agricultural resources and consequently the republic's export trade, provided that a price shall be arrived at not subject to fluctuations; and that the greatest disadvantages that the Mexican Government and the railways suffer from the depreciation are therefore the constant fluctuations in the market price of silver. Mr. Carden's views appear in a report on the effect of the depreciation of silver in Mexico, addressed to Lord Rosebery on August 4, 1893.'

'It would occupy too much space to give here the chief portions of Mr. Carden's report, and I will only insert, therefore some of its main points :

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"A low price of silver," Mr. Carden says, if permanent, would not only not be prejudicial to Mexico as a whole, but would conduce to its ultimate benefit by the stimulus it would afford to the development of its immense agricultural resources." His conclusions are that "the losses which would be sustained by the government and the railway companies are essentially limited in their amount, the benefits which would accrue to certain of the productive industries are susceptible of indefinite extension," and that such extension would "at once make itself felt in an increase in the revenues of the government as well as of the railways.”

The reasoning by which these interesting conclusions are supported is somewhat too extensive for full quotation here. Mr. Carden's report is supplemented by exhaustive tabulations of the statistics on which he formed his views. He points out that the fall in the exchange value of the Mexican silver dollar from 37d. (its average for some years) to about 33d. (the present level), involved an additional loss to the government of about $2,000,000 in meeting the gold payment on its external debt, while to make good the effect of the silver depreciation on the indebtedness of the railroads on which gold must be paid, the lines would have to increase their earnings by over 23 per cent. At the same time it is figured out that an increase in the premium on gold from 30 per cent. to 50 per cent. produces, all other things being equal, a loss of 10 per cent. in customs duties to the Government.

Coming to the other and more favorable side of this question, Mr. Carden contends that the fall in silver would be accompanied by an increase in the purchasing power of the country. The amount of foreign goods imported depends chiefly, he argues, on the number of dollars available for the purchase of such goods, which, in its turn, depends upon the general prosperity of the country. As the present year, 1893, promises well for the agricultural interests, there are good grounds for expecting that the consequent increased movement of trade will to some extent compensate the