The Sun.
London, England, 1863-12-01 00:00:00

Financial Position of Federal America,

The loans and bonds of the Northern States bear
a much higher interest than the debt of European
Powers. To bring the apparent rate of interest on
the debt down to 3 2-3 d per cent,, the Washington
pamphleteer includes the debt which he considers is
not bearing interest, and so strikes his average. For
obvious reasons this mode of calculation must be
rejected. The American loans, in fact, have been
contracted at rates of interest varying from 5 t°
7 3-10th per cent. The two largest sums have been
unly obtained at 6 and 7 3-10th per cent.; so that,
as national burdens to be dealt with in the future,
this gigantic pile of debt is much more serious tb°l,l
it looks if the total of the principal is only regarclei"
The average rate of interest on interest-bearing
loans, in May last, is admitted to have been 6 Per
cent. ; and Mr. Chase has been driven to the recit'
less issuing of paper, merely to escape the respone
sibility of raising money at so ruinous a price.
The visions of the Government financiers as to
the repayment of their debt of,
say, ultimately
£500,000,000 sterling—a low computation--with
£300,000,000 sterling bearing interest at six per
cent., are as wild as their boastful comparisons
with England, and their song of triumph over the
absence of taxation. They talk of extinguishing
the debt in twelve years and eight months, and at
the very farthest, in twenty-one years and eleven
months. It must be manifest that, even if this cow
putation were well-grounded, it would suppose a
political stability in the residuary States which
there is no reason to expect. It would also require
moral qualities in the American nation that till
are known not to possess. The maintenance e:
the Federal bond in the North, with Democrat
and Republican tugging in different diree'
tions, for a quarter of a century, 18 an
improbability so great, that the world. can
build nothing on a hope so delusive; and it l!,;
equally an improbability that, even if the bond
were preserved the taxes would be borne b 9
people who have only to excite a popular clamour
to get rid of them. In the first season of depres-
sion affecting the trading and operative classes/
they would De swept away.
But how much would require to be raised yearly
The friends of Mr. Chase say 189,500,000 dollars
would carry on the Government, pay interest 0.0
the debt, and provide for ito extinguishment
in
the period already specified. Let us see how the
matter stands. The total peace expenditure was
133,000,000 dollars. With 56,500,000 dollars,
surplus, no.
therefore, the debt is to be appetz"d' and finally
wiped off. If there were realty
doubt a great deal could
willingness of the
bseu°dlOna e. But if
the tax-bearing resources and
the limit
Northern States stand at of 189,50000
dollars, there will be no such remainder to apply
fallacy inc alculating the future expenses of the
to the pur
oses of the debt. There is an obvious
standard
the No ofrt h formeraro entering times. p 0
an
entirely e
nation
American by thetaeteis of
existence, and no o ae can undertake to
define
wnehatw xits conditions and necessities will be.
It is absolutely certain, however, that its expendi-
ture will be more in keeping with _European tbeil
American precedents, and we
for assuming that the nation's resources will mune see gr°lled
ingo the n earlier
the t he
history sameof the atuion
ited
States. Not only must an army, and probably
very large one, be maintained, in order to project
an erbitrary frontier, and to prevent surprise, bud,
that army will itself create political difficulties, ala
involve we know not what in the wayr
of trou°_..
and outlay. It may create war by a demoratic.l%
solence which there will be no ',Toper power 10
CO
Popular Executive, distracted by quadrennial ecu..,,
tests for the Presidency, to repress. Conflicts Irtilit;
the South, with Canada, or of one State with eu:
~0
(most likely of all), will break in rudely upo lust
amiable and honest scheme of the men of the 1311311
for the annihilation of the National Debi. ,
calculation as to its redemption in 12 years, or 'l",,era
are in short a delusion. Americans--the No` 1_
be
nation and the Southern both—ere henceforth
ca
saddled with a national debt from which ththeynot shake themselves free, except by revolutio.u_tPro.
dishonour. The madness of the North hate..lle,er.
to
duced the people of the residry States to
.rol %Ybed
neanent disgusts of grievous taxation, and
l ElLii.„
upon them necessities which seem to involve
Dublin Unit c 7 sity Magazine.
change in their principles of Goyernu-u''