View metadata, citation and similar papers at core.ac.uk brought to you by CORE provided by UT Digital Repository DISCLAIMER: This document does not meet current format guidelines Graduate School at the The University of Texas at Austin. of the It has been published for informational use only. Copyright by John Taylor Vurpillat 2014 The Dissertation Committee for John Taylor Vurpillat Certifies that this is the approved version of the following dissertation: The Other Cross of Gold: The United States and the Search for Global Monetary Stability, 1867-1900 Committee: Mark A. Lawrence, Supervisor H.W. Brands Mark Metzler George B. Forgie James K. Galbraith The Other Cross of Gold: The United States and the Search for Global Monetary Stability, 1867-1900 by John Taylor Vurpillat, B.A.; M.A. Dissertation Presented to the Faculty of the Graduate School of The University of Texas at Austin in Partial Fulfillment of the Requirements for the Degree of Doctor of Philosophy The University of Texas at Austin May 2014 Acknowledgements Any work that requires such sustained effort is never the product of personal endeavor alone. I heartily thank my committee for their keen advice and generosity of time and spirit on my behalf. I also want to thank the Department of History at the University of Texas at Austin for providing the support and environment to complete this work. I am grateful to those whose mentorship and friendship have aided the process, especially George Forgie, Tony Hopkins, Penne Restad, and Marilyn Lehman. Most of all, I am grateful for the love and support of my wife, Paige Webb Vurpillat. iv The Other Cross of Gold: The United States and the Search for Global Monetary Stability, 1867-1900 John Taylor Vurpillat, Ph.D. The University of Texas at Austin, 2014 Supervisor: Mark A. Lawrence This study examines the official diplomacy and transnational discourse surrounding the spread of the international gold standard between 1867 and 1900. The sustained nature of these exchanges among advanced and emerging economies of the period was driven by global deflationary pressures that coincided with dramatic monetary policy changes in Europe, Asia, and the Americas. As such, the diplomatic struggle between states that sought to alter the international gold standard and those that defended the emerging monetary status quo offers a clear window into the politics of nineteenth- century globalization. Between 1878 and 1897, the United States led efforts to modify international monetary relations by replacing the gold standard with an international bimetallic standard. The central object of US diplomacy was to change the gold standard policy of Britain. The nineteenth-century global economy was largely a creation of British policy and historical circumstances. A change in British policy, thus, implied a change for the entire commercial world linked to Britain. I make two central arguments about these diplomatic events. First, that the US campaign for an international bimetallic standard was pursued with far more policy- v minded purpose than previous interpretations allow. Prior studies have judged most of these efforts as sideshows driven by the calculations of electoral politics rather than sincere responses to global economic conditions. Second, I argue that the policy proposals embodied in US efforts emerged within a far broader, far lengthier transnational discourse than previous interpretations suggest. Past studies have portrayed the economic views that underpinned US diplomacy as peripheral ideas espoused by a minority far from the mainstream in economic thought. Persistent US initiatives to alter international monetary relations through diplomacy ultimately ended in failure. This result, however, rested more on failures of politics than on the outré nature of international bimetallism and its advocates. At several key junctures, considerations of geopolitical rivalry and the constraints of political ideology in Europe overwhelmed US efforts. This failure left in place the deflationary pressures imposed by the gold standard until the late nineteenth century, when new gold discoveries provided exogenous monetary relief and removed the impetus for further diplomacy. vi Table of Contents Introduction: A Clockwork Globe Unhinged ..........................................................1 The United States, the Gold Standard, and Nineteenth-Century Globalization .................................................................................1 International Bimetallism and Anglo-American Relations....................7 Historiography .......................................................................................9 Methodology ........................................................................................16 Implications..........................................................................................18 Chapter 1: Transnational Discourse and the Origins of US Bimetallic Diplomacy, 1867-1878 .....................................................................................................23 Introduction ..........................................................................................23 The Triumph of the Gold Standard ......................................................30 The Fall of Silver and the Rise of International Bimetallism ..............38 Radical Alternatives and the Authorization of International Bimetallism .....................................................................................................49 Conclusion ...........................................................................................62 Chapter 2: The Fall and Rise of US Bimetallic Diplomacy in World Politics, 1878- 1881...............................................................................................................64 Introduction ..........................................................................................64 Discrediting Bimetallic Utopias: The Conference of 1878 ..................74 A Struggle for Gold and the Return of International Bimetallism .......96 The Triumph of the Bimetallic Argument .........................................117 Conclusion .........................................................................................136 Chapter 3: Global Depression and the Challenge to the British Gold Standard, 1881- 1891.............................................................................................................140 Introduction ........................................................................................140 The War for Gold ...............................................................................145 The War of the Words........................................................................157 American Advocates of International Bimetallism in the British Debate ...................................................................................................177 vii Conclusion .........................................................................................184 Chapter 4: Failing to Save the World: The United States, Britain, and Silver, 1889- 1893.............................................................................................................186 Introduction ........................................................................................187 Background to US Diplomacy ...........................................................195 Toward a New Monetary Conference ................................................200 The Conference Convenes .................................................................209 The Rothschild Compromise .............................................................213 Conclusion .........................................................................................220 Chapter 5: Reunion of Financial Conservatives, 1893-1900 ...............................223 Introduction ........................................................................................223 The Revival of International Bimetallism in Britain .........................234 Monetary Relations, Financial Collapse, and the Rise of Anglo-American Antagonism ...............................................................................258 International Bimetallism and Anglo-American Rapprochement .....279 Conclusion .........................................................................................299 Conclusion: The Price of Gold ............................................................................304 Bibliography ........................................................................................................316 viii List of Tables Table 1.0: Proposed Monetary Regimes in U.S. on Spectrum of Nineteenth- Century Financial Orthodoxy ...........................................................53 Table 2.0: Stability of Gold to Silver under French Bimetallism ....................126 ix Introduction: A Clockwork Globe Unhinged However the silver question may be decided, it cannot fail to be regarded in history as one of the most important public questions of our time. 1 George A. Walker, 1877 The United States, the Gold Standard, and Nineteenth-Century Globalization The floors of the crowded Chicago Coliseum rumbled and strained under the crescendos of applause directed at the young man speaking from the podium. It was the ninth of July 1896. That afternoon at the Democratic National Convention all the tensions and anxieties accumulated over decades of extraordinary economic development in the United States