The Sun.
London, England, 1869-01-27 00:00:00

THE SUN, LONDON, WEDNESDAY EVENING, JANUARY 27, 1869.

raw 0.-sfey, Wltll a little =mixture or mait. .c)y
varying the common routine of temperatures, times,
and stirrings, he has brewed beer from roughly-
ground barley, mixed with crushed malt, in the pro-
portion of three bushels of barley to one bushel of
malt ; and he affirms that the beer so produced is
as strong, sound, and bright, and as good in every
respect as the beer he brews from malt alone. He
saved 10s. 6d. upon three barrels of beer. The Chamber
of _Agriculture Journal, referring to this matter,
points out that chemical researches have exploded
the old-fashioned idea that in order to obtain the
object of malting—the conversion of the starch into
sugar—it is necessary to germinat6 every grain of
barley. A small portion of malt mixed with a large
quantity of unmalted barley will do all that is
required, so that the above-mentioned experiment is
strictly in accordance with scientific experiments.
This being so, there is a waste and destruction of
£900,000 a year in obtaining £6,500,000 for the
national treasury, a loss equal to nearly one- seventh
of the tax, and this is over and above the loss
incurred in the collection of the duty. Mr. Lowe
must be on the alert, or he will be finding himself
bankrupt before he knows it.

AUSTRIA.

In view of another severe legislative struggle, the Aus-
trian Government has strengthened its party in the
Chamber where the greatest opposition may be ex-
pected. Seventy new peers have been created, all refor-
mers, and all of course on the side of the Ministry.
Their aid*will be wanted. Two new laws are expected to
give great trouble : one ordaining that press prosecutions
shall be tried by a jury; the other abolishing all restric-
tions upon marriage, and especially restrictions of rank or
religion. Civil marriage is compulsory, but it may be
followed by a religious ceremony. The Prussians seem to
have been roused in some degree by the impetuous
progress of the hitherto dilatory Austrians. The Berlin
Chamber of Deputies has adopted a law abolishing the old
statutes which still prevent marriage between nobles and
commoners. This measure has to get through the Upper
House—decidedly a process dangerous to its existence.

REVENUE OF THE UNITED S7ATES.

It has been shown that within a period of three
years and seven months the revenues, or the re-
ceipts from all sources of revenue, reached the
enormous sum of $1,662,496,062 20, and that
$630,431,125 90 were paid on debts which were
actually due at the close of the war and for boun-
ties, which, like the pay of the army, were a part of
the expenses of the war. Adding the amount thus
paid to the debt as exhibited by the books of the
Treasury on the first day of April, 1865, it appears
that the debt of the United States at that time was.
$2,997,386,203 24, and that the actual reduction his
been $470,256,650 42 ; and but for the advances to
the Pacific roads and the amount paid for Alaska
would have been $519,650,650 42. The Secretary
begs to suggest, as he has substantially done before,
that alleviation of the burden of the public debt is
to be obtained, not in a decrial of the national
credit, not in threats of repudiation, not in a fur-
ther issue of irredeemable notes, not in arguments
addressed to the fear of the bondholders, but in a
clear and explicit declaration by Congress that the
national faith, in letter and spirit, shall be in-
violably maintained ; that the bonds of the United
States intended to be negociated abroad as well as
at home are to be paid when the time of payment
arises in that currency which is alone recognized
as money in the dealings of nation with nation.
Let Congress say this promptly, and there can be
but little doubt that the credit of the Government
will so advance that within the next two years the
interest on the larger portion of the debt can be
reduced to a satisfactory rate. He therefore
earnestly recommends that it be declared, without
delay, by joint resolution, that the principle of all
bonds of the United States is to be paid iu coin. It
is also recommended that the Secretary be autho-
rized to issue $500,000,000 of bonds, $50,000,000
of which shall matureannually ; the first $50,000,000
to be payable, principal and interest, in lawful
money, the principal and interest of the rest in
coin, and also such further amount of bonds as may
be necessary to take up the outstanding six per
cents., and the non-interest bearing debt, payable
in coin 30 years after date, and redeemable at any
time after ten years, at the pleasure of the Govern-
ment, the interest to be paid semi-annually in coin,
and in no case to exceed the rate of five per cent.
Provided, that the Secretary may, in his discretion,
make the principal and interest of $500,000,000 of
these bonds payable at such city or cities in Europe
as he may deem best. The fact that according to
the recommendation $50,000,000 of the bonds to be
issued are to become due each year for ten conse-
cutive years (at the expiration of which time all of
the bonds would be under the control of the Go-
vernment) would insure an annual reduction of
$50,000,000 of the Public Debt, and impart a credit
to the other bonds which would insure the negotia-
tion of them on favourable terms. Of the expe-
diency of an issue of bonds corresponding to some
extent in amount with those held in Europe, the in-
terest and principal of which shall be paid in the
countries where they are to be negotiated, there can
be but little doubt. On this point the Secretary used
the following language in bis report of 1866 :—'The
question now to be considered is not, how shall our
bonds be prevented from going abroad ? for a large
amount has already gone, and others will follow, as
long as our credit is good and we continue to buy
more than we can pay for in any other way ; but
how shall they be prevented from being thrown
upon the home market to thwart our efforts in re-
storing the specie standard ? The Secretary sees no
practicable method of doing this at an early day but
by substituting for them bonds which being pay,
able, principal and interest, in Europe, will be less
iikely to be returned when their return is the least
to be desired. The holders of our securities in
Europe are now subject to great inconvenience and
not a little expense in collecting their coupons, and
it is supposed that 5 per cent., or perhaps 4i per
cent., bonds, payable in London or Frankfort. could
be substituted for our 6 per cents., without any other
expense to the United States than the trifling coin-
missions to the agents through 'whom the exchange
might be made. The saving of interest to be thus
effected would be no inconsiderable item, and the
advantages of having our bonds i n Europe placed in
the hands of actual investors is too important to be
disregarded. The Secretary has nothing further to
say on this point than that careful reflection has only
strengthened his conviction of the correctness of the
views expressed in foregoing extract. In recom-
mending the issue of bonds bearing a lower rate
of interest to be exchanged for the outstanding
six per cents., the Secretary must not be understood
as having changed his opinion in regard to the ex-
pediency or the wisdom of the recommendation in
his last report. Ile refers to what he then said in
advocacy of that recommendation, as an expression
of his well-considered opinions at the present time,
and he is only prevented from repeating the recom-
mendation by the fac• that it met with little appro-
val at last session, and has not grown into favour
since. He sincerely hopes that the future history of
the debt will vindicate the wisdom of those who are
unable to approve the proposition.

The accompanying report of the Commissioner of
Internal Revenue gives the necessary information
in regard to the Bureau, and contains many very
judicious recommendations and suggestions, which
are worthy the careful eonsidt ration of Congress.
The internal branch of the Revenue service is the
one in which the people feel the deepest interest.
The Customs dutits are collected at a few points,
and although paid eventually by the consumers,
they are felt only by the great mass of the people in
the increased cost of the articles consumed. Not
so with the internal taxes. These are collected in
every part of the Union, and their burdens fall, to
a large extent, directly upon the tax-payers. Asses-
sors, collectors, inspectors, detectives, necessary_
instrumt me in the collection of the revenues, are
found in every part of the country ; there is no
village or rural district *here their faces are not
seen, and where collections are not made. The
eyes of the whole people are, therefore, directed to
this syttern, and it is of the greatest importance
that its administration should be such as to entitle it
to public respect. Unfortunately this is not the
case ; its demoralization is admitted, and the ques-
tion arises, where is the remedy? The Secretary is
of the opinion that it is to be found in such amend-
ments to the Act as will equalize the burdens of taxa-
tion and in elevation of the standard of qualification
for Revenue offices. Upon the subject of internal
taxes the Secretary has already spoken in regard to
the charaoter of the Revenue officers : he has only
to say that there must be a decided change for the
better in this respect if the system is to be rescued
from its demoralized condition. After careful re-
flection the Secretary has come to the conclusion
that this change would follow the passage of the
bill reported by Mr. Jenckes from the Joint
Committee on Retrenchment and Reform on the
14th of May last, entitled A bill to regulate
the civil service and promote the efficiency
thereof.' fhe Secretary gives to this bill his
hearty approval, and refers to the speech which
was made upon its introduction by the gentleman
who reported it for an able and lucid exposition of
its provisions, and for a truthful and graphic de-
scription of the evils of the present system of ap-
pointments to office. On the sth day of October
last, the day for their regular quarterly reports, the
number of National Banks was 1,644, 17 of which
were in voluntary liquidation ; their capital was
$420,634,511, their discounts $655,875,277 35,
their circulation $295,684,244, their deposits
$601,830,278 40. In no other country was so large
a capital ever invested in banking under a single
system as is now invested in the National Banks.
Never before were the interests of a people inter-
woven with a system of banking as are the interests
of the people of the United States with their na-
tional banking system. It is not strange therefore
that the condition and management of the National
Banks should be to them and to their representa-
tives a matter of the deepest concern. That the na-
tional banking system is a perfect one is not as-
serted by its friends; that it is a very decided im-
provement, as far as circulation is regarded, upon
the systems which it has superseded, must be ad-
mitted by its opponents. Before it was established the
several States, whether in conformity with the Consti-
tution or not, jointly with the General Government
during the existence of the charter of the United
States Bank, and solely after the expiration of that
character, exercised the power of issuing bills of
credit in the form of bank notes through institu-
tions of their own creation, and thus controlled the
paper money, and thereby in no small degree the
business and commerce of the country. In May,
1863, when the national Currency Bureau was
established in Washington some 1,500 banks,
organized under State laws, furnished the people of
the United States with a bank-note currency. In
some of the States the banks were compelled to pro-
tect, partially at least, the holders of their notes
against loss, by deposits of securities with the proper
authorities. In other States the capital of the
banks, that capital being wholly under the control
of their managers, was the only security for the
Redemption of their notes. In some States there
was no limit to the amount cf notes that might
be issued if secured according to the require-
ments of their statutes, nor any necessary relation
of circulation to capital in others, while notes
could be issued only in certain proportions to capi-
tal. There was no restriction upon the number of
banks that might be organized, the notes of a few
banks being payable or redeemable at commercial
centres were current in most of the States, while
the notes of other banks, perhaps just as solvent,
were uncurrent beyond the limits of the States by
whose authority they were issued. How valueless
were the notes of many of the State banks is still
keenly remembered by the thousands who suffered

by their insolvency, the direct losses sustained by
the people by an unsecured bank note circulation,
and the indirect losses to the country resulting
from deranged exchanges, caused by a local cur-
rency constantly subject to manipulation of money
changers, and from the utter unsuitableness of such
a currency to the circumstances of the country
can be counted by millions. It is only necessary
to compare the circulation of the State banks
with that furnished by the national banks to
vindicate the superiority of the present system.
Under the national banking system the Govern-
ment nhich authorises the issue of bank notes and
compels the people to receive them as money as-
sumes its just responsibility and guarantees their
payment. This is the feature which especially dis-
tinguishes it from others, and gives to it the
greatest value. The object of the Secretary, how-
ever, in referring to the national banks is not to
extol them, but to call the attention of Congress to
the accompanying instructive report of the Con-
troller of the Currency, especially to that part of
it which exhibits the condition and management
of the banks in the commercial metropolis, and
to the amendments proposed by him to the
Act. On the sth day of October last the loans
or discounts of the banks in the city of New
York amounted to $163,634,07023; only $90,000,000
of which consisted of commercial paper, the balance
being chiefly made up of what are known as loans
of call, that is to say of loans of collaterals subject
to be called in at the pleasure of the banks. Mer-
chants or manufacturers cannot, of course, borrow
on such terms, and it is understood that these loans
are confined merely to persons dealing, or rather
speculating in stocks or coin. This statement shows
to what extent the business of the banks in New
York had been diverted from legitimate channels,
and how deeply involved the banks have become in
the uncertain and dangerous speculations of the
street. The deposits of these institutions on the day
mentioned amounted to $226,645,655 80, and of
their assets $113,332,689 20 consisted of certain
cashitems, which were in fact mainly certified
checks which had been passed to the credit of depo-
sitors, and constituted a part of the $226,645,655
80 of deposits, although the banks always deduct
such checks from their deposits iu making up their
statement for the payment of interest and their esti-
mates for reserves. It is understood to be the practice
of a number of the banks—perhaps the practice
exists to a limited extent in all—to certify the checks
of their customers in advance of the deposits, out of
which they are expected to be paid; in otherwords,to
certify checks to be good under an agreement be-
tween the banks and the drawers that the money to
protect them shall be deposited during the day, or
at least before the checks which go through the
Clearing House can be presented for payment. The
Secretary has learned with great surprise that a
number of banks, generally regarded as being under
judicious management, certify in a single day the
checks of stock and goll brokers to many times the
amount of their capitals, with no money actually on
depcsit for the protection of the checks at the time
of their certification. A more dangerous practice,
or one more inconsistent with prudent—not to say
honest—banking, cannot be conceived. It is un-
authorized by the Act, and should be prohibited by
severe penalties. Aside from the risk incurred by
this reckless method of banking, the effect of such
practices is to foster speculation, by creatinginfla-
tion. It is, in fact, part and parcel of that fictiti-
ous credit which is so injurious to the regular busi-
ness of the city, and to the business of all parts of
the country which feel and are affected by the pul-
sations of the commercial- centre. It is this very
dangerous practice, combined with the more general
practice of making loans on call, which leads to un-
safe extension of credits, and makes many of the
banks in New York helpless when the money mar-
ket is stringent.

The Commissioner of Internal Revenue states
that the largest receipts for internal revenue were in
1866. Reductions in the scale of taxation have
since been made at five several times. The aggre-
gate receip,s from internal revenue, exclusive of the
direct tax upon lands and the duty upon the circu-
lation and deposits of national banks, were-For
the year 1866, $310,906,984; 1867, $265,920,474;
1868, $191,180,564; of these there were from banks,
trust companies, and savings institutions, $7,650,062
in 1866, $5,815,515 in 1867, $5,489,753 in 1868 ;
from railroads $11,076,260 in 1866, $7,507,507 in
1867, $7,024,667 in 1868; from insurance compa-
nies $1,936,954 in 1866, $1,889,488 in 1867,
$1,894,335 in 1868 ; from telegraph compa-
nies $308,438, in 1866, $239,595 in 1867,
$214,699 in 1868 ; from express companies
$645,769 in 1866, $558,359 in 1867, $671,590 in
1868; from revenue stamps $15,044,373 in 1866,
$16,094,718 in 1867, $14,852,252 in 1868 ; from
legacies and successions $1,168,766 in 1866,
$1,861,429 in 1867, $2,813,452 in 1868 ; from in-
comes $60,894,136 in 1866, $57,040,641 in 1867,
$32,027,611 in 1868 ; from " articles in ache lule
A" $1,692,792 in 1866, $2,116,495 in 1867,
$1,134,106 in 1868; from special taxes $18,015,743
in 1866, $18,103,616 in 1867, $15,966,313 in 1868;
from cotton $18,409,655 in 1866, $23,762,079 in
1867, $22,500,948 in 1868; from cigars, $3,476,237
in 1866, $3,661,984 in 1867, $2.951,765 in 1868.;
from tobacco $12,339,922 in 1866, $15,245,478 in
1867, $14,974,108 in 1868 ; from fermented liquors
$1,515,140 in 1860, $5,819,349 in 1867, $5,685,644
in 1868 ; on distilled spirits and brandy $29,482,078
in 1866, $29,164,409 in 1861, and $14,200,731 in
1868. The Commissioner felicitates himself on
the increase in receipts from legacies and succes-
sions. Of distilled spirits he says-" The falling
off of receipts in 1 868 resulted in some degree from
the general expectation that the duty would be re-
duced, and the consequent unwillingness to
withdraw spirits from bond at the higher rate,
but mainly from the frauds which made such
reduction indispensably necessary. The amount
of spirits in bonded warehouses on the Ist of
July, 1866, was 6,081,551 gallons ; in 1867,
17,887,272 gallons ; in 1868, 27,278,420 gallons., '
The expenses of collecting the revenue for 1868
were in detail as follows :-Compensation and ex-
penses to assessors and assistant assessors, $5,181,179;
compensation and expenses to c011ect0r5,52,262,231;
superintendents of exports, $20,385 ; revenue agents
$61,210 ; special agents to this office, $94,600 ;
revenue inspectors, $374,518 ; officers and clerks of
this bureau, $316,769 ; stamps and cotton tags,
$139,365 ; other incidental expenses of this office,
$71,349 ; commissions on sale of stamps, $805,638;
making a total of $6,327,301, against $8,222,686
for 1867, and $7,689,700 for 1866. The pay of
assistant assessors has been increased from $4 to $5
a day. There are also a larger number of special
agents. The number of assistant assessors Nov. 1,
1867, was 3,180. There ara now but 2,284. For
1866 the expenses were $2.49 per hundred of net
collections, and $2.47 per hundred of gross collec-
tions ; for 1867, $3.41 per hundred of net, and
$3.38 per hundred of gross ; for 1868, $4.94 per
hundred of net, and $4.88 per hundred of
gross. The commissioner seeks to show that this
increase has been unavoidable, the expenses re-
maining much the same, while the receipts have
been diminished by the reduction of taxation:
The amounts deposited bycollectors for four months
of the fiscal year 1869 (July 1, 1868, to June 30,
1869), compares as follows with those of previous
years :-July, $16,989,650, against $24,734,656 in
1868, and $27,079,103 in 1867; Aug., $13,900,396,
against $17,848,051 in 1868, and $38,043,341 in
1867; September, $9,760,796, against $13,183,607
in 1868, and $33,714,719 in 1867 ; October,
$10,092,335, against $14,486,636 iu 1868, and
$26,414,430 in 1867. Of the falling off in these
four months as between 1869 and 1867 $35,097,838
was on income. There has also been the repeal of
the tax on manufactures. Five thousand three hun-
dred and five suits were brought in Federal courts
during 1868, 2,294 being in rem. ; 1,981 indict-
ments were found and filed, and 1,030 other pro-
ceedings in personam. Judgments were recovered in
1,261 cases of proceedings for forfeiture, and 749
convictions obtained on indictment (some includ-
ing more than one person) ; 2,532 suits were de-
cided for the United States, and 382 against; 624
were settled or dismissed-2,905 still pending ;
$741,797 was recovered on judgments. Proceeds
of forfeitures paid into court-$1,136,151. The
commissioner finds that the rule prohibiting pay-
ment of expenses incurred by judges sitting outside
their own districts has worked ill. He also thinks
that district attorneys should be paid more liberally
for convictions. The number of cases compromised
has been 536. From these parties was received
$1,154,027. The remodelling of distilleries to con-
form to the law and the regulations, and the erec-
tion of distillery warehouses, have been the occa-
sion of great expense and delay to their proprietors,
while the survey of distilleries, the procurement
and distribution of stamps, the preparation of forms
and regulations, and the greatly increased corres-
pondence consequent upon the inauguration of the
new law, has occasioned a great amount of labour,
from which the results have not yet appeared.
The number of distilleries registered is 1,990. The
plans of 316 have been received and filed, none
of them from the Pacific coast. Distillery ware-
houses have been established to the number of
459, and 204 distilleries are in operation, with
a,n aggregate daily capacity of 227,758 gallons.
The number of class B warehouses on the 15t day
of July last wets 779. At present the number is 172.
"The statute now in opera ion contains many im-
provements upon that of 1866, is fuller and mere de-
finite in its exactions, places the distilleries and the;r
operations more completely in the hanls of the Go-
vernment, and is more rigorous in its punishment of
offenders, but its successful operation after all must
depend upon the vigilance and fidelity of the local