In Continental Europe the greatest development of cooperation has been in the direction of credit and loan associations-"People's Banks." These had their origin in Germany, but have spread all over continential Europe. There are two forms of these banks, known from the names of their originators, as the Schulze-Delitzsch and the Raiffeisen banks. The latter are the more altrustic in spirit and the most widely extended. The main principle of nearly all these banks is the unlimited liability of every member of an association for all debts of the association. With this security the banks are enabled to borrow money very cheaply, to be loaned to their members, with only sufficient profit to pay expenses upon the most economical scale. There are also, of course, the proceeds of the stock taken up by the members, and the deposits. I do not find, where I write, any late statistics of the business done by these banks, but in the aggregate they amount to hundreds of millions of dollars annually, and form altogether the most imposing display of the power of cooperation in business affairs.

Other forms of cooperation are the trade unions and other friendly societies in the matter of life and health insurance, fire insurance societies, building and loan societies, and profit sharing. Taken together, the amount of cooperative business done in the world is astounding to those who first come to the study of it. It has been demonstrated many times over that the aggregate savings of the poor are far in excess of the aggregate capital of the rich, and that there is quite as much capacity for the wise employment of capital, and its profitable direction, among the poor as among the rich. The poor, therefore, having in the aggregate more capital and more business ability than the rich, as well as enormously greater physical strength, have no need to fear the encroachments of concentrated capital. They need only to cooperate to fully protect themselves.

Appendix G.

I. STATISTICS RELATING TO CURRENCY QUESTIONS.

1. OBJECT AND Method of STUDY.—A popular study of the "Currency Question" is generally understood to have for its object the formation of a judgment in regard to the effect of changes in the character and volume of the currency upon the standard of life. From the standpoint of the farmers who, in the aggregate, always carry an enormous permanent indebtedness, secured by mortgage, nothing more directly affects the standard of living than the ease or difficulty with which they are able to meet the interest and principal of this long-time indebtedness; nor is there any better index of the farmer's material prosperity or want of it, than the extent of his ability to meet these engagements promptly. The farmer whose debts do not trouble him can, and usually does, enjoy the comforts of life, and many of its luxuries. For the farmer, therefore, nothing is more important, in connection with the currency, than its justice as a standard of deferred payments. But it is not the only important thing for the farmer to consider, for like the day laborer, who may own no property, the farmer is also a large buyer of commodities, and profits by the cheapness of such as he has to buy.

A very common method of conducting such a "study" is to first form the "judgment," and then diligently hunt for the "statistics" to sustain it. Sometimes people do not even "form" their judgments, but accept them ready made at the hands of some political or social orator or publication. It need not be said that this is a very bad way indeed to "study" a question. No good can come from such a method. A much better way, and indeed the only good way, is to obtain, so far as possible, all the statistical facts bearing on the problem, arrange them in an orderly and logical way and then sit down and try to see what, when they are all taken together, they prove. Such a brief paper as this appendix must be, can contain only a few summaries from the vast quantity of the statistics which have been gathered upon the currency question, nor will it be possible to include as much of explanation as would be desirable for those not familiar with these studies; but an attempt has been made to include what is most important, including all that are commonly used in popular discussion in this country, with such explanatory matter as will enable a person of ordinary education to reach an independent judgment, and feel that he is able to defend it. A wrong judgment which is the result of

independent study is of far more value to a man than a correct judgment accepted from somebody else; for one man's error can do no great harm to society, while the acquirement of the art of study will be of infinite value to the man, and probably enable him, in due time, to correct early erroneous judgments, perhaps founded on insufficient, or inaccurate data. The proper order of topics for the study of currency questions seems to me to be, first, the statistics bearing on the volume of currency; secondly, those relating to the ratio, past and present, between gold and silver, and finally, those relating to prices.

2. SOME CAUTIONS ABOUT THE USE OF STATISTICS.-It is, perhaps, desirable to say something about the use of statistics. In the first place they are not always entirely accurate, because in the nature of things they can not be made

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The receipts and expenditures of governments can be stated to the smallest fraction, but valuations of exports and imports, for example, are not nearly so accurate. Valuations made for the purpose of assessment of ad valorem duties are substantially correct, but those assigned to importations to be sold upon commission, and upon which the duty to be collected is "specific," are sometimes hardly rough approximations. A cargo of lemons, for example, may be certified by a consul in Sicily at $1.50 per box, and yet not actually sell for much more than freight money. We know exactly the amount of gold and silver coined in all countries, for a long period back, and the amount of government, and, usually, of bank paper money in circulation, but we do not exactly know the movement of the precious metals, coined or uncoined, from one country to another, the amount used in the arts, or the stocks of them in the world at different periods, or at present. For everything not the subject of actual bookkeeping and balance sheets we are dependent upon estimates. These estimates, however, are not made at random. They are the work of capable men whose profession is the compilation and arrangement of statistics, who are fully aware of, and carefully consider the danger of, error, and give, after careful consideration, their judgment of the facts. In such matters as the amounts of the precious metals in the world, four hundred years since, when the study of statistics was hardly thought of, we can place little reliance upon the tables, and we do not know very well, even to-day, the quantity of gold and silver annually used in the arts. The production of these metals, however, has for many centuries been a matter of government record in all civilized countries, in most of which a royalty upon the product of mines is exacted by the government, and a rigid accounting required. In our own country no such accounting is kept, but the authorities of the mint, with the aid of the express companies and banks, make a very close approximation to our production. From such semi-civilized countries as China statisticians get the best information possible and make up their judgments upon it. Gold and silver passing from one country to another by sea, as freight or express, must be entered upon the manifests of the vessels, and is recorded in custom houses. That which passes to and fro upon the persons of travelers must be estin.ated or disregarded. In the main the monetary statistics of the past fifty years, so far as they are those of civilized countries, may be regarded as reliable, for what they purport to be.

It is not, however, always as easy as it might seem to know what statistics really teach when we have them. For example, statistical tables and diagrams which follow show that the purchasing power of gold has enormously increased during the past thirty years, and that the farmer who for that period has kept alive an old mortgage, by renewals, must now dispose of far more produce to pay the debt, than would have paid it when originally contracted. On the other hand, tables of current rates of interest, for the same period, equally authentic, and indeed with less liability to error, show that in 1896 it required twice as much money invested in gilt-edged bonds, to produce an income of $1,000, as would have produced that income in 1870. To arrive at a correct conclusion these two tables, possibly, upon analysis, not so contradictory as they seem, must somehow be reconciled. A skilful controversialist, by using only one set of these tables, can make an argument, unanswerable by a popular audience, which will show that debtors are suffering very severely by the appreciation of money, and immediately thereafter take the other table before another audience, and with equal conclusiveness, prove that the poor creditors have practically lost half their debts. One can prove almost anything by statistics, so long as he is permitted to select his tables. Imperfect as many of them are, statistics are invaluable for the study of economic problems, as long as they are intelligently and honestly employed, and all the facts, instead of only part of them, are considered. This is sometimes very difficult. Not only is our information limited, but our mental powers, which largely accounts for the zeal with which good men differ on economic problems. It is not everyone who has the intellectual grasp to compass great subjects.

Statistical tables make a very dreary looking page for the ordinary reader, and are, of course, not intended to be read by any one, but to be referred to when it is desired to make use of the facts which they show. For the purpose of quickly conveying the facts of statistical tables to the reader, it is a common practice to employ diagrams, drawn to a scale, upon which the fluctuations of the tables are shown by lines. This is a very useful practice, as it enables the eye to take in at a glance the lesson of a long column of figures. Like many other good things, however, the method may be easily abused, and, in the hands of designing persons, be made to convey impressions not at all warranted by the facts. The trick is very simple, and consists merely in making the vertical spaces of the scale large or small, in relation to the horizontal spaces, according as the draughtsmen desire to convey the impression of great or small fluctuations. For example, the ratio of silver to gold previous to 1873 was constantly fluctuating, and yet the variations were so small, that popular discussions of the relations of silver and gold usually take no account of them, and silver and gold are often, and properly enough, represented on diagrams by an identical line, for some years previous to 1873. It would be very easy, however, for a series of those years, by constructing a diagram in which vertical spaces of one inch should represent one per cent of variation, and horizontal spaces of one-half inch represent years, to convey the impression that the ratios of the two metals were fluctuating within very wide limits. The increasing use of these diagrams in popular discussion, sometimes very disingenuously, makes it proper to give this caution. Economists and students, and political

writers in their private studies, pay very little attention to diagrams illustrating controverted topics, because they must constantly guard against false impressions. They study the tables, and if they desire diagrams they construct them, which any one can do who will take the trouble to draw the spaces evenly.

I can best illustrate this by an example, and for this purpose will take a subject which is illustrated in this way perhaps more frequently than any other -the variations in the ratio between gold and silver since 1873. Diagrams I., II., and III. represent precisely the same thing, as a careful inspection will show, and yet, when drawn separately, upon a blackboard, they would produce a very different effect upon an audience. Diagram I. differs from II. merely in having its vertical spaces twice as large, while diagram III. differs from II, only in having the horizontal spaces doubled. They all represent the appreciation of gold, as compared with commodities, according to the tables of the London Economist, for the period covered. (See pages 614 and 615.)

3. STATISTICAL AUTHORITIES.-The original authorities relating to the production and stocks of the precious metals, and emissions of paper money, are mainly the records of the governments of the world. The principal nations now publish this information annually, compiled from official sources. The earlier estimates were compiled by eminent statisticians from researches in governmental archives, and such other sources as in their judgment are entitled to respect. The basis of confidence is in the competence of the compiler. None are included here which have not received the endorsement of the Director of the United States Mint, or the Finance Committee of the United States Senate by being included in official publications. The same may be said as to the table of ratios. In regard to prices, the most exhaustive study ever made in any country is that made under the direction of a sub-committee of the Finance Committee of the United States Senate, and found in Senate Report No. 1,394, Fifty-second Congress, second session (1893). The period covered begins with 1840, and ends with 1891. These tables include the course of wholesale prices of from two to three hundred articles in the United States. These tables have never been continued. There are many similar tables compiled by statisticians, of which those most commonly referred to are those of Dr. Augustus Sauerbeck, of London, of forty-five articles in England, and the London Economist, of twenty-two commodities. These are regularly continued each year. Another very valuable set of tables is that of Dr. Adolf Soetbeer, of Germany, and continued, after his death, by others. These tables give the wholesale prices of one hundred commodities in Germany, and fourteen English articles. Other recognized statistical authorities are the Journal of the Royal Statistical Society, London, which is made up of original contributions, and Mulhall's Dictionary of Statistics, which is a compilation. For convenient reference Waldron's Handbook of Currrency and Wealth (Funk & Wagnalls, New York, 1896. Price fifty cents) is an excellent compendium, containing most of the tables to which it is usual to refer in discussing currency topics. For careful study all these tables require the aid of explanatory matter which always accompanies their original publication, but for which there is no space in a compact summary.