The Sun.
London, England, 1864-12-26 00:00:00

YEAR.

Any estimate which may be mado of the probable re-
ceipts and expenditures for the next fiscal year must neces-
sarily be liable to still greater uncertainty. This remark
applies more particularly to expenditures, for while, if exist-
ing laws remain unchanged, the amount of revenue may be
calculated with reasonable certainty, it is impossible to anti-
cipate what the exigencies of war may require. On the one
hand this may call for increased effort, and oa the other
it may be confidently hoped that the great struggle is near
its termination, and that consequently the estimate now
submitted will prove far beyond the wants of the year.
While any doubt remains, however, it would be unsafe to
assume any other basis of calculation than one predicated
upon the existing state of affairs. The receipts for the year
ending June 30, 1866, are estimated as follows :

Dollars,
From customs
Internal duties 300,000,100
Lands . l,c 00,0c0
Miscellaneous sources ....

Aggr, gate . 306,000,f 00
The expenditures are estmated as follows;
Balance of unexpended approprhtions 350,000,000
For the civil service
Pensions and Indians
The War Department
Nary Department
Interest on public debt

Aggregate
But from this aggregate there miy be deducted
as likely to rtmain unexpended at the close
of the year

Total O•
818,256,005

Deduct estimated receipts from ordinary 50urce5,396,000,000
dole, there will remain to be provided for by loans 422,256,005
dots. To this should be added for the redemption of excess of
certificates of indebtedness 47,365,000 dots, making the
whole amount to be provided for by loans 469,621,005 dots.
Assuming the correctness of these estimates, the whole debt
on the Ist day of July, 1863, would be found by adding the
foregoing amount of 422,256,005 dole to the estimated debt
1 on July ;, 1865, 2,223,664,067 dole, giving 2,64.5,320,632
dots as the amount of the debt at the close of the next fiscal
year. The calculation is made on the same basis of receipts
as that assumed for the current year. It is quite probable,
in. the judgment of the Commissioner of Internal Revenue,
that 3,000,000 dole may be received in another year frog,
that source, without the additional legislation suggested by
him, Should this supposition be verified, and the new taxes
proposed for this year be laid and continued, an additional
hay millions might be expected from internal revenue, The
secretary hae, however, thought it wiser to name 300,000,000
as all that would probably be realised. It will be observed
that the actual receipts from ordinary sources for the last
fiscal year varied materially from the estimates, particularly
from customs and internal revenue. This variation is im-
putable, in great part, to the legisla ion of Congress at its last
session, increasing largely the rates of duty on foreign and
domestic articles. It is apprehended, 'hat similar results will
not follow for the residue of the present year in both
these particulars. The increase of duties on imports under
the act of June 30, 1564,- has already had the effect to de-
crease importations to a considerable extent, and the same
effect will be likely to continue. So that estimating the re
ceipts of the three remaining quarters by those of the first
in the light of former experience, it will not be sate to cal.
culate upon revenue from customs much exceeding
70,000,000 dots for the current year. In the judgment of
the secretary, this disadvantage, in a financial point of
view, is more than counterbalanced by the stimulus
afforded to domestic industry and the consequent increased
revenue from that source. From internal revenue a diffe-
rent and far more favourable result may be anticipated. It
will be noticed that instead of 77,599,703 dole 59c there was
received from this source in the past year 108,260.320 dole
57c under the same law which in ten mouths of the pre-
ceding year yielded only 37,640,787 95c. The new law,
which went into operation on July 1 last, largely increased
these duties, although it will probably fail to produce the
amount of revenue hoped fur, may, if not materially
changed, together with the special income tax imposed by
the joint resolution of July 2, 1864, be safely estimated to
produce the sum of 25,000,000 dole, should the business of
the country be ordinarily prosperous. The same causes
which, under preceding laws, produced so large an increase
in the second year, would be likely to have a similar effect,
to some extent, under the new law ; so that at least the
amount of 25,000,000 dots may be expected from it in ano-
ther year without the aid of a special income tax. But this
amount is not, and ought not to be, satisfactory. Three
hune red millions at least should be realised from interne'
duties. It is for Congress to select the sources and devise
the modes in which this most desir;tble result can be ob-
tained, and the report of the Commissioner of Internal Re-
venue is referred to for his views on this important point, as
well as for many valuable suggestions having reference to
the same general subject.
DEFICIENCY TO PE PROVIDED FOR.
From preceding statements it appears that, exclusive of
the receipts from ordinary sources, the amounts following
are to be provided, viz.:—For the fiscal year ending June
30, 1865, 570,727,598 dots lle ; for the fiscal year ending
June 30, 1866, 469,621,005 dole 17c•—total, 1,040,348,513
dots 28c, Deduct amount non authorised and balance in
the Treasury, July 1, 1864, 560,063,188 dole 20, it leaves
a balance to be provided for by additional legislation of
480,285,325 dots 26c. It will be observed that this ba-
lance is predicated upon contingencies which may not
occur, and calculations which may prove deceptive.
It would be unsafe, therefore, to limit so closely the pro-
visions to be made by Congress for meeting the expendi-
ture of this and the succeeding years. To raise a large por-
tion of the amount neceasary to meet these authorised ex-
penditures!, it is obvious that recourse was to be had to
loans, which have been already in part negotiated. The
necessities of former years have led to many expedients, as
it is apparent from the diversity of forms which our securi-
ties present, As the debt increases from year to year, bor-
rowing becomes more difficult. Embarrassed as the country
is with two systems of backing. and obstructed as the
,riovernment is by a currency wholly beyond its control,
it maddest that to push its owh circulation far, if it all
beyand its present limit, could only be justified by absolute
necessity. To thrust our securities upon the market in
such amounts as it is not able to bear and to retain no check
upon stock jobbing c ombinations, must exercise a disastrous
effect upon the public cTedit, and operate injuriously upon
large numbers who have heretofore invested their means
liberally and confidingly in Government issues. The
Secretary is not unmindful that in the opinion of many per-
sons conversant with financial waters a recourse should be
hcd to foreign markets, and in two acts of Congress, one of
whi,3l2 is still in force, authority has been given to negotiate
a foreign loan. This, if practicable at all, on terms which
the Se cretary could feel justified in accepting, would in his
opinion, at the present time, and under existing laws, be
so inconsiderable in amount that its effects would be
merely temporary, and would afford an alleviation rather
than a relief. Our bonds have already, to a considerable
amount, been .sought for abroad and to that extent the
home market ha s been relieved and strengthened. Com
mnnication with Europe is now so easy and regular, in-
telligence is trans), nitted so rapidly, businesss facilities are
I so abundant, that,foreign markets are almost at our own

doors, and a demand abroad is felt almost at the same
moment and'supplied without injurious delay. To effect a
foreign loan would not, as it has seemed to the Secretary,
add much if at all to the whole amount of sales unless
stimulated by efforts and inducements which our financial
condition has hot as yet called for, and though a certain
advantage might be gained in the power to control in some
degree tho rate of foreign exchange by the deposit of a large
sum to be drawn against as occasion might require. The
possible benefit thence to be derived has not seemed suffi-
cient to counterbalance other and opposing considerations,
This nation has been able thus far to conduct a domestic
war of unparalleled magnitude and cost without appealing
for aid to any foreign people. It was chosen to demonstrate
its power to put down insurrection by its own strength,
and furnish no pretence for doubts of its ability to do so,
either to domestic or foreign foe. The people of the United
States have felt a just pride in their position before the
world. In the judgment of the Secretary it may be doubted
whether the national credit abroad has not been strength.
ened and sustained by the fact that foreign investments in
our securities have not been sought by us, and whether we
have not found a pecuniary advantage in self-reliance ; but
however this may be, it seemed to the Secretary that, even
it inclined to attempt the negotiation of a foreign loan, the
time was unpropitious, and the difficulties attending such a
negotiation while exchange was subject to rapid and vio-
lent fluctuations, upon any safe terms, appeared almost in-
surmountable. Whatever risk was to be incurred must
necessarily fall on the Government. He thought it wiser
therefore to wait until events should have more fully de-
monstrated the inevitably favourable result of the contest in
which the nation is engaged, which time he believes to be
near at hand, rather than venture on an experiment which,
if successful, could afford but temporary relief, aneta failure
in which might be attended with evils of a very serious
character. Believing the country can, if it will, sustain for
a long time to come any burden which the war is likely to
impose, the Secretary has deferred an undertaking which
seemed to him so doubtful of success and so questionable in
its results. It may be added to these consideration that to
have the interest on our public debt payable at home, and
to our own rather than to a foreign people, are advantages
the value and importance cf which can hardly be too highly
estimated.

Upon this report or budget the city writer of the
New York Herald has the following remarks

The report of the Secretary to the Treasury leads Wall•
street to expect further issue of currency to an indefinite
amount ; for his complaint against the restrictive provisions
of the act of July 2, 1861, and his promise to suggest, at an
early day, such modifications as be considers necessary,
leave no doubt in the public mind as to the haphazard policy
he will pursue if the finances are left under his control.
" In his judgment a wide discretion should be entrusted to

the officer charged with the duty of negotiating loans, in
order that he may be enabled to avoid unexpected diffi-
culties occasioned by possible conditions of the money mar-
ket. The discretion thus confided should, in the opinion
of the Secretary, include the power of increasing the cur-
rency." What is the nation to expect from a finance Minis-
ter who talks in this way, when not much less than 1000
millions of currency, including the State and national bank
issues, already flood the land, and when this currency in-
flation has done more than the entire funded debt to depre-
ciate the gold value of the paper dollar to about 41c., at
which it stands to-day? Mr Fessenden would seem to be
deliberately inviting the worst evils that inevitably over■
take excessive issues of irredeemable paper money, And yet
while asking for the wide—too wide—discretionary power,
he appeals to the people to save him from the necessity of
using it in these words :—"Ndr does he believe that a pa-
triotic people, struggling for national existence and pos-
sessed of ample means, would compel him to adopt a mea-
sure so fraught with injurious consequences as an issue of
paper money beyond the limit so prescribed." And " to no
individual would any considerable addition to the circula-
tion in any form be more objectionable than to the present
head of the 'treasury Department, and no one would re-
sort to such a measure when the circulation was adequate
to the wants of busine:a with more reluctance." Herein we
have a virtual admission that he is ready to increase the
volume of the currency indefinitely to float his loans, or
when there is in his opinion not enough money 1.:o supply the
wants of trade. If 160,000,000 dols in coin and 140,000,000
del bank notes were sufficient for the needs of commerce in
the whole of the loyal States at and before the time of the
suspension of specie payments, nearly 1,000 millions ought
to be enough now. Mr Fessenden, unfortunately, sterna to
overlook the fact that the more paper money there is in cir-
culation the more we require ; for every addition to its bulk
tends to its depreciation, and consequently the greater is
the amount required for common uses. When thousands of
millions of French assignats had been issued, where before
hundreds had sufficed, the Directory still wanted and
issued more because their purchasing power had
diminished in proportion to the extent of their issue ;
and so it was with the old continental money of this
country, and the end of both was worthlessness
and repudiated by the people. But the warnings
of history may well be neglected by one who has failed to
profit by the great lesson taught by the fiscal policy thus
far pursued under this administration. " It is for the people
(says Mr Fessenden) to determine whether the necessary
means shall be furnished by way of loans and the circola-
don be restrained within safe limits, or whether they will
crater to endorse the evils of exorbitant prices, with a loss
of credit in the:present and a debt of needless magnitude en-
tailed upon the future. Their financial officer can only
submit to their decision and act as the necessities of the
occasion may demand." As he makes no objection to the
amount of currency outstanding, but, like Oliver Twist,
asks for more, it is to be inferred that he considers it as yet
within " safe hnits." He'speaks of loans as the only al-
ternative of currency inflation, apparently placing no reli-
ance upon increased taxation. Indeed, in that part of the
report where he refers specially to taxation, he estimates
the probable receipts (after adding what he considers a
centingent sum of 50,000,000 dole.) from internal revenue
at only 300,0000,000 do Is. for the current fiscal year. It is
easy, however, for anyone acquainted with the resources of
the na- ion to see that double this sum might be raised with-
out pressing unduly upon any section of the community.
But upon this important branch of his subject the secretary
has nothing to say worth mentioning. He avoids it as he
has avoided telling the people what the national debt is at
the pretent time, and the ratio of this from the Ist of July,
up to which time his statements only extend, to the end of
October, contradict his estimates for the future, and he
leaves the country in a fog, to get out of its financial em-
barrassments in the b at way it can.