Benjamnin F. Butler, Butler's Book: Autobiography and Personal Reminiscences of Major-General Benjamin Butler

[941] from Maine tells them that the government will pay the principal in gold, although they paid but forty cents on the dollar for them when they bought them. This is the reason why this five-twenty loan is crushing our people, and why we must get rid of it at all hazards consistent with national honor and national faith, and no man asks that to be broken.

But I am told if we undertake to pay any portion of this debt in greenbacks we shall depreciate greenbacks so that they will be worthless; that there will be an inflation of prices. The gentleman from Maine riots in imagination over the picture of the payment of $200 for a pair of boots if we issue any more legal-tender notes, that is to say, notes not bearing interest.

Speaking of greenbacks, I am reminded of one thing to which I meant to have adverted, on the question: of the nation's being bound by the advertisements by which its bonds were sold. My friend says we did not notify capitalists that we would claim the right to pay these five-twenty bonds in any other way than in coin. Why, we put it upon $150,000,000 of United States notes, and thus advertised everybody we did not mean to pay them in gold. This notice was put on the back of every greenback. Let me read from one :--

This note is a legal-tender for all debts, public or private, except duties on imports and interest on the public debt.

There is “inclusio unius exclusio alterius” ¹ for the gentleman.

The common idea is that there will be inflation when you issue paper money. It is drawn from the old idea of bank circulation. A bank issued its notes without any basis except the gold basis. That gold basis was sometimes one to four. Let me illustrate: suppose there were four hundred millions of bank paper in circulation on one hundred millions of gold as a basis, then I agree it would be an inflation to issue another one hundred millions, making the relation of the paper dollar to the gold dollar as one to five. But what is a greenback? Have gentlemen considered? A dollar greenback as it stands to-day is one twenty-five hundred millionth part of the debt of the United States, secured by a mortgage upon every dollar of public or private property in the United States. Is it not that, under my theory or anybody else's theory of finance? Now, suppose we issue five hundred millions of greenbacks, and pay up five hundred millions of the interest-bearing debt of the United States, what is a greenback then? Why, it is still one twenty-five hundred millionth part of the national debt of the United States,