called "the resumption of specie payments."

Almost every nation has at some time issued political money. During
the Franco-Prussian War in 1870, France, through the medium of its
great state bank, made forced issues of notes of a political nature,
which only slightly depreciated. Many countries--Russia, Austria,
Portugal, Italy, and most of the South and Central American
republics--have had or still have depreciated paper currencies.

At once, at the outbreak of the great war in 1914, the governments of
the warring nations began to exercise a strict control over the issue
of paper money, sought to gather into the public treasury all the
specie, and to give paper (either governmental notes or bank
notes) practically a forced circulation, making it almost the sole
circulating medium. The values of the paper moneys have fallen in all
the countries, especially in Germany and Russia. In such cases the
money partakes somewhat of the characters both of bank notes and of
political money. Resorted to in desperate extremities, political
money has usually proved to be a costly experiment. A result usually
unintended is the derangement of business and of the existing
distribution of incomes. The rapid and unpredictable changes in prices
gives opportunity for speculative profits, but injure legitimate
business. This incidental effect on debts and industry offers the main
motive to some citizens for advocating the issue of paper money. It
is peculiarly liable to be the subject of political intrigue and of
popular misunderstanding. It is this danger, more than anything else,
which makes political money in general a poor kind of money.

§ 11. #Theories of political money.# There are two extreme views
regarding the nature of paper money, and a third which endeavors