The Sun.
London, England, 1867-11-25 00:00:00

THE SUN, Loisitio.N. AIONI)AY EVENINC;, NOVEMBER 25, 1:367.

AMERICAN FINANCES.

J:VITORTANT LETTER FROM THE HON. THAD,

STEVENS.

LANCASTER, Pennsylvania, Oct. 31,1867
Hon. Thaddeus Stevens :
_ _

Dear Sir,—As usual, when in doubt upon any
subject which I suppose you to understand better
titian 1 do, I never feel the least difficulty in asking
your opinion upon the subject, because I have
ever found you willing to answer an old neighbour
so far as you find yourself able. I see an angry
controversy has sprung up between two gentlemen
as to what kind of money the national debt shall
Le paid in. One gentleman argues from what he
supposes to be the law of the question and the
duty of the Government under its legal obliga-
tions to those who hold its liabilities ; the other
seems to deal principally in what he considers ought
to have been the duty of Government in the dis-
charge of its debts to those who hold them, at what-
ever price they may have been purchased, and to
deal in strong vituperation against those who would
pay according to law, if that law contradicts his
idea of equity, without any regard to the letter or
the spirit of the contract between the Government
and the holder, and to denounce as immoral the
payment of its debts according to contract, because,
at other times, other nations have paid more, and
because a portion of that present debt is also paid
at a higher rate. _ _ _

Novi, I am a banker, desirous to do business upon
legal principles, and at the same time to deal justly
with all men, so that when I have passed away, as
I soon shall, I may not be represented as a swindler,
a robber, an unjust man, whose memory should be
held in execration for my dealings with my fellow-
men. While lam unwilling to wantonly sacrifice
my estate, I shall not hesitate to aid in paying any
portion of the half a billion of money necessary,
if necessary to support a good character, although
the same should come out of the taxes and hard
earnings of our labour.

Willyou also, if you have time, add a word as
to your idea of the wisdom of the management of
our finances and of our financial system generally ?
I remember you, at one time, did not quite agree
with the then Secretary of the Treasury.—Yours,

very truly, JOHN GYGER.
LANCASTER, Pennsylvania, Nov. 4, 1867.

Dear Gyger,—l shall not hesitate to answer the
questions which you have proposed to me according
to my poor ability, although I know that I thereby
incur the risk of sharp and frivolous criticism by
able New York editors, whose age is scarcely more
than eighty years, and who will probably discover
in ray answer evidence of old age and of decaying
intellectual powers. Of all this lam myself con-
scious, and only regret the pain which it gives those
youthful gentlemen to make such delicate sugges-
tions. But as literary pride has never been among
my aspirations I will not venture to smother the
free intercourse with my neighbours in advanced
life.

They need hardly tell you, who reside my near
neighbours, what I doubt not is apparent in the
intrinsic evidence of my poor productions, that
these things which 1 am too often giving to the
public are dictated from a sick bed, in the intervals
of pain which Providence indulges me with, and to
which those gentlemen abroad so kindly refer. But
as I may print or not print as suits my discretion, I
have no right to complain of the criticism or ridi-
cule which gentlemen in vigorous health see proper
to bestow upon our productions.
So far as the financial condition of this republic
is concerned, it is not, and never can be, in doubt
or peril. With the products which we can readily
dispose of to supply the demand of every kind, there
never can be a time when, with honest dealings,
this republic will be unable to pay all her just liabi-
lities.

The best mode of managing her finances, of
which you inquire, and which you are much more
capable of determining than I am, and I least of all,
is a much more difficult question, and one which
has puzzled abstractionists long before Adam Smith.
I have not approved, and do not now approve, of
the financial policy pursued by our Government
for the last six years. I think we have thrown
away our billions, and are still throwing away our
millions, by mismanagement.

You are a banker, and a sound one ; but you
are making more by the United States through
the national banking system, as i 3 every other
man who has adopted it, than you ought to
make. This may appear dogrcatical ; but lam
only answering the question which you have
asked me.

In all financial questions he who makes an
honest bargain and pays dollar for dollar, every
cent he contracts for, is not a dishonest man,
and does not deserve to be denounced as a
swindler or a cheat, whatever may be his pros-
perity in life.

Let us come to a brief and true history of the
present finances of our country, and see whether
you have anything to reproach yourself with in
dealing with your fellow citizens in the exchange
of those finances. Every nation of any magni-
tude in the present stage of civilisation, and with
any considerable business and commerce, must
and will use some kind of a paper medium to
carry on its business. None but the Choctaws,
Chickasaws, and their kindred tribes now doubt or
deny this. In framing our constitution it was not
doubted that this medium must be used, redeem-
able by its equivalent in whatever should be the
money of the country. That instrument provides
that the general Government shall coin money and
regulate its value. Under that clause I have never
doubted that the general Government alone was
competent to issue bills of credit ; or, in other
words, to establish banks of issue, and to declare
what should be the money of the country and its
value. We have fallen, lam sorry to say, into a
different practice, and States do that which, for the
sake of uniformity, the general. Government alone
ought to control.

The certain result of all large commercial trans-
actions under any system is, that sometimes the
currency of a country will be expanded and some-
times contracted according to the supply and the
business and the prudence of the people. This is
what is called the expansion and contraction of
the currency, and denounced as a thing which
might have been avoided. That expansion or con-
traction is in no wise effected by the kind of money
which is used. If it be too abundant or too scarce,
it is of no consequence whether it be in coin or in
paper. A hundred millions too much of gold is just
as injurious in inflating prices as a hundred millions
too much in greenbacks. But in my judgment,
which ever is used by Government should be
promptly redeemable, according to the law of re-
demption, which shall be directed by the power
that authorised the issue, who should use it without
the payment of interest, and profit by the losses
which are incurred in its destruction.

The law of redemption, regulating redemption,
both as to the commodity in which it shall be re-
deemed, and its intrinsic value compared with the
money issued, is as much a part of the contract as
the price of the article reduced to writing and sealed
by the parties. Not because of the usage of the
country, but because of the law which says so.
When, therefore, you find that the standard of the
American dollar is one hundred cents, and you are
in the possession of such dollar, you know that you
are entitled to just one hundred cents for your
money and no more, whether that one hundred
cents be made of leather, tin or greenbacks, and its
mode of payment pointed out. And when the
Supreme Court shall have decided such law to be
constitutional and binding upon all, it being the
highest tribunal to decide between man and man in
all earthly affairs, it is not only legal, but is just,
as part of the law of the contract, to pay your debt
in that money, which, if the Government was wise
when it created it, cannot be a loss to the citizen.
He may not be a fool who doubts this proposition,
but he has an excessive folly which all the world
except himself and his creditors will ridicule. it
was your contract and it was your Government,
created by yourself, that fixed its security and who
is responsible,:as you are, partly for a foolish ar-
rangement, if there be loss. If you do not like the
legislation of your Government and the provisions
it makes for your welfare and that of aU its citi-

coin.

zees, choose better men, or go elsewhere for pre,_
tection ; but do not tell us that, when one-half of
the community impose laws upon the other half
and make them binding, and that other kalf obey
those laws, they are swindlers and villains. The
language is neither decorous nor such as g entlemen
would use.
Money ! What is money ? If it be a fixed, un-
alterable thing of intrinsic and known value, why
does the constitution put it into the power of a
legislative tribunal to create it and reassess it a'new ?
It is all fancy. Money is just what the law -makes
it, and you must take the chance that you r Go-
vernment make it wisely, and when made y ou fix
your eye upon it and make your contract ac cord-
ingly. I abhor repudiation or clipping the coin ;
and yet this nation has twice, or, I think, three
times, by its legislation reduced the price of silver,
and made it pass to every creditor as well as debtor
at the original price.
Who are these reasoners, who, with these facts in
view, talk so learnedly of the laws of finance and
morality of human dealings ? Whose consciences
are so raw, and stick out so far from their excited
covering that no pharmaceutist can heal their in-
ward wound; no poultice can cicatrize it sufficiently
to take from it its lasting plague after the malefac-
tor shall have lain himself down in the hope of seek-
ing rest in another world? Now let us come to
the Government loan, and for a single moment con-
sider it, which, even without the monstrous doc-
trine of Greely and Cooke, is the most profitable in-
vestment ever made by money-lenders, and is a
monstrous swindle on Americans, on the part of
European capitalists. In what I say I would not
depress that loan by a single dollar, for all the profit
which it were possible for me to make by it ; for it
has done its service, and no more than its service to
the American Government in the days of her need ;
and for F uch service it has been trebly rewarded by
the nation. When I say this I do not begrudge
the poor speculator or the rich capitalist who has
entered the gold room a beggar and come out with
a princely fortune, his earnings ; that is not his
folly, hut the folly of the Government, which, though
a hundred times warned, would never take heed.
Would to God that my intellectual vigour might
increase in proportion to my disease, that I might
properly depict this important subject to the Ameri-
can people. But such a phenomenon will never
again be found to exist this side of Port Royal.
In 1860-61, when the war broke out, it was found
that the then Administration—for what purpose I
will not undertake to pronounce—had left the coun-
try bare of all defensive weapons, and not only with
an empty Treasury, but $80,000,000 in debt. The
first few millions ne,Kled to equip our army and
navy were easily borrowed, for our Government had
a very poor and shallow idea of the intensity of
feeling of the independent belligerent with whom
we hasl to deal. But it was soon found that all the
energies of the nation were necessary to defend
freedom from the plunderers, the robbers, the re-
volutionary cut-throats, our Southern brethren I
think they are called, whom we had to deal with.
The next loan of $250,000,000 was readily taken by
the Philadelphia, New York, and Boston banks.
But when Congress assembled the banks complained
that the Treasury had so placed their loans, by
aggregating them in the deposit banks, as to render
them, the lenders, unable longer to pay coin for
them. They, however, went on and paid them in
currency at some discount, which, I think, cost,

the Government some millions of dollars. Still

the Treasury was soon emptied, such was the
enormous draft upon it for war material. Inquiry
was then made of bankers and brokers by the
Committee of Ways and Means, of which I hap-
pened to be chairman, as to the probability of ob-

taining a loan, and at what rate. The answer was
discouraging, and did not give us reason to hope
that we would be able to obtain sufficient money
to carry on the war at more than eighty-five per

cent., with interest at six per cent. on the loan.

The committee were unwilling to take eighty-five
per cent. principal and receive the loan in a depre-
ciated currency, which would have probably brought
it to seventy-five per cent. This was borrowing
millions at so ruinous a rate that we looked around

for other means. Two of us, Mr. Spaulding, of
Buffalo, and myself, were in favour of issuing notes
of the United States and making them a legal
tender, but receiving them at par for all transac-
tions with the Government, believing that they
would pass at very nearly par for all the supplies of
war material which the Government might need ;
as all demand, both by the Government and indivi-
duals, for anything but legal tender, would thereby
be taken away. No reason could be seen why, to
the extent of the demand in this country, which
proved to be nearly the whole, they should go much

below par. They would answer every purpose for
which the farmer, mechanic, merchant, and manu-
facturer desired to purchase material. We remem-
bered that in England for most of the time that
specie payment was supended her bank notes were
at about fourteen per cent. discount. After having
repeatedly attempted to purchase loans at a less
sum than what in coin would be about $lO on the
$lOO, we urged the Secretary of the Treasury to
give his consent to offering a loan and issuing there-
for United States notes and making a legal tender.

To this two members of the committee agreed, but
the others, together with the Secretary, decidedly
refused their consent, as he (the Secretary) had very
consistently done in his report. The committee
waited, again =stilted the moneyed men of the
country, and found that no large loan could be
obtained in coin except at a most ruinous price.
They again importuned the Secretary for his con-
sent, the committee having become a tie. A bill
for the issue of $100,000,000 of legal tender had

been drawn and offered by Mr. Spaulding, and was

allowed to remain in that position till February,

when a Democratic member of the committee, re-
serving the right to vote against it, consented that
it might be reported. In February, after severe
opposition, it passed the House and was sent to the
Senate. Then nothing was said about the currency
in which either principal or interest were to be paid.
No one, I suppose, doubted that the loans of the
United States of every description were payable in
the money of the United States of every description ;
but to change that aspect as it regarded a portion
of the fund, the New York money changers ►gain
made their appearance, Jew and Gentile mingling
in sweet communion to discover some cunning in-
vention to make in a day what it would take weeks
for honest men to earn. They went directly to the
Committee of Ways and Means, and asked that the
interest should be made payable in coin, leaving
the principal as it was. The committee utterly re-

jetted the absurd proposition of two currencies—
two legal tenders—in the same empire and for the
same commodities. They had once heard of such a

transaction in Austrian bonds, which utterly de-
stroyed their credit. The brokers then resorted to

the Secretary of the Treasury. He was more easily
persuaded, and, it is understood, went with them to

the committee of the Senate and pressed the change.
The Finance Committee of the Senate agreed to it,
and sent it back to the House with that amendment.
The House rejected it, and the consequence was a com-

tnittee of conference, and as some bill was necessary
it resulted in the present law, making the debts of
the United States, so far as regarded their interest,
payable in a different kind of a currency from the

debt itself. One of the House Committee proposed
then, in order to raise a sum sufficient for that pur-
.

pose, that the duties on imports should be paid in

That proposition prevailed, and the result
was and is that the interest on the national loans

and the duties on importations are payable in one
kind of money called log.il tender, but made of a
different material and of a different shape. Thus,
as any one can see, the Congress declared that

for one of the greenbacks or certificates of loan of
the nation. Under the easily excited imagination
of the American public, and seeing a system of
finance which no human folly had ever before wit-
nessed, hopes were excited much more rampant than
the lottery dealers or the faro players ; and, in the
belief that a single turn of the card would bring up
the holder's fortune, palaces were opened for the
purpose of inviting speculation and dealing in this
new system of gambling. Some became rich while
others went to beggary—doubling and doubling
their ventures to indemnify themselves; everything
became excited and inflated, from the commonest
fabric to the most valuable estate. Thus the arti-
cles necessary to supply the war were vastly in-
creased in price, while the honest Jews of the gold
rooms, Shadrach, Aleshach, and Abednego, came
out unsinged.
The violation of an undertaking to do or not to
do may be compensated in money. Sometimes the
amount is liquidated by the parties and sometimes
let to be fixed by a jury. In either event it is to
be paid for in the money of the country—in this
country in dollars and cents. No one ever supposed
that the non-fulfilment of a contract is to be paid for
in kind. A plaintiff recovers a verdict of $l,OOO,
the non-payment of a farm ; execution issues for
$l,OOO in money ; and the defendant can tender
the sheriff $l,OOO of the legal tender of the
country and he is obliged to take it in full pay-
ment of the debt. How inconsistent is that with
the idea that the creditor can select his medium
of payment? A man sells his property for
forty horses, worth $lOO each, amounting in cash
to $4,000 ; if the purchaser do not pay and is
sued for the debt, judgment is given against him
for $4,000, not for forty horses. How would you
execute a judgment given and an execution
issued for forty horses ? Indeed there is no
breach of contract, either sounding in damages
or in contract, which cannot be paid by tender-
ing the amount assessed in a legal tender note.
As to the equity and morality of these transac-
tions, I have never discussed them.
A colleague of mine in Congress, and excellent
man and rich, asked me whether I supposed the
United States loan of 'Bl, made before the
passage of theact, would be paid in coin or currency.
I told him it might be paid in either by the ex-
press terms of the law; but that I did not know
how the Secretary of the Treasury would treat
it. He told me the next day that he had
consulted the Secretary, who said he would
pay it in coin, being then due. He had
invested $30,000 in legal tenders at a cost of
$30,000, for which he received $60,000 in green-
backs or its equivalent in coin. A consti-
tuent of mine, within two months after the ad-
journment of the Congress that passed this law, in-
formed me that he had guaranteed to a gentleman
in Philalelphia before the passage of the law a
judgment of $28,000, expressly payable in gold.
The creditor demanded the money. It was then
worth about two or three times its nominal value.
He went to him and tendered the amount in green-
backs. He refused to accept and issued execution,
and the Court set it aside, and compelled him to
take the lawful money of the United States which
had been offered him. Whether the transaction
was a moral or immoral one every gentleman must
judge for himself, and will judge according to his
position. If a man be dealing for himself, with his
own money, I can understand his right to bestow

the half of the whole of the sum upon his creditors,
either under the fancy of generosity or honour.
But when he is acting as trustee for others and pay-
ing out the money of cestui que trusts and wards,
it seems to me that there may be in morals,
although not law, a question about the difference.
It is but just to ➢lr. M'Culloch here to say that
he does not pretend that the principal of the Five-
twenties (as his late letter shows) is payable in
coin, as the bonds are silent upon that subject, and
as that conclusion is excluded by that very silence.
It is just also to the Democratic party to sty that

when the question has been discussed in the House
no lawyer among them has set up such a foolish
pretension ; and when the bill was on its final
passage the question was expressly asked of
the chairman of the Committee of Ways and
Means, and as expressly answered by him,
that only the interest was payably in coin. But
every instrument speaks for itself, and when it is
silent upon the subject of the currency, it is always
made payable in money, which means the legal ten-
der of the country. I fear, however, I am elaborat-
ing this point, ad nauseam, unless a newspaper
editor or a country broker ca❑ enact laws and af-
terwards enforce them. There is nothing short of
the sheerest folly in this argument, and it will not be
persevered in by those who have sufficient strength
to carry them genteelly over the " asses' bridge."
Nay, more; I feel that what I am going to state
may set New York editors and brokers upon a dan-
gerous rampage amid the flowery fields and golden
images of Chiriqui and Golfonto ; and yet I shall
venture to say that if the United States chose to be
faithless enough she could tender and pay not only
the principal but the interest in legal tenders, al-
though the latter is expressly contracted to be paid
in coin. The law of legal tender means this or it
means nothing. Let not this alarm any one, for no
nation short of the basest Asiatics would ever think
of such an act, however capitalists might ask
trustees, guardians, and administrators to violate the
law and their sworn oaths to double the revenu
which the public debtor is to pay them.

What would be the difference in effect between

-
the two modes of paying the public creditors—in
greenbacks, as the loans fall due, or exclusively in
coin—l once had a calculation made, when I brought
in a bill to borrow greenbacks for that purpose (in-
deed, I brought in three bills hoping to save two
or three billions thereby). But each session the
rattle of the gold room was much louder than what
I was pleased to call the voice of reason, and what
I still think deserved that appellation.
Take the number of millions which through six years
of war have been expended, which is alarming, and count
it, as I wish some one would do, on the principle I have
laid down, when for some time the premium was at 281
per $lOO, and the sum will be appalling. Take $lOO and
count it into greenbacks at the above rate ; it will produce
you $2Bl. Now, so convert or use it every day for one
year, and you have at the end of the year a diffeabnce of
$66,065, the gold bearers costing the Government that
much more than the legal tenders. Take $lOO,OOO, and
suppose the legal tenders to be worth at all times at least
half as much as coin for all articles which the Government

may need, which no man can doubt, convert or use it daily
for a year at that rate, and you have a difference of

$36,500,000 in favour of greenbacks. But the business of
the Government during the war amounted to more than

$1,500,000 per day, I presume. For one year it would

amount to $547,540,000, and during the war, upon an
average of three years, it would amount to $1,642,500,000;
and this vast sum would also be the amount in favour of

ment.

greenbacks, for the same length of time, rate of expendi-
ture, and at the above difference in price. Why is this

clamour against a legal tender, which answers all the pur-
_ _

poses of solid metal, and which has never been complained

of by the business men of the community ? Why is there
such a headlong desire for the resumption of specie

payment, much earlier than England returned to
it after her wars which left her a less debt than ours ?

She was not able to resume until more than eight years
after cessation of hostilities ; notwithstanding her great
commercial advantages over the rest of the world, and not-
_

withstanding she had in circulation but a little ovor

$20,000,000. Is she deluded by the free-trade quacks into
the belief that $lOO,OOO paid out to her own industrial classes

is more useful than $200,000 paid out to the industry of
our own farmers, labourers, and mechanics? Is she again
to bo taught that cotton—crippled, hump-backed, crook-
shouldered as she is -is still to be king ? Still you see
that every advantage is taken of circumstances by the
English Government to build up, not only her foreign
trade, but her farmers and mechanics. We have heard

great praises bestowed upon Cobden for his liberality in
granting free trade to France in her late treaty after he
had succeeded in abolishing the corn-law duties. Short-
_ _

sighted seioliste I For the Navigation Act, the most stria-
.

gent that ever protected domestic industry from the pos-
sibility of foreign competition, gave to England the com-
mand of the ocean ; since England never consciously en-
tered into any treaty or arrangement which gave to foreign
nations an industrial advantage in mechanics or manufac-

tures over her own people, if it wore in her power to pre-
vent it, as the late treaty with France conclusively
shows.

After she had driven the Flemings from the ocean, and
Genoa and the free towns of Holland had been compelled
to surrender their advantages to the eoperior skill and
_ _

hardihood of the fishermen of the Lowlands—after Van

Tromp had lowered his haughty flag and no longer
threatened to sweep the ocean with a broom, this masterly
Navigation Act of the commonwealth of England was in-
troduced, and prevails iu many of its feature() to the pre-

sent day. While other nations had more numerous harbours
and ports, England, surrounding the world from drum
beat to drum beat, stood sentinel to protect her own people
against the encroaching industry of other nations, so that
her sentinels could call out almost audibly to each other—
Watchman, what of the night ? All this was produced by
her protection of the industry of the country wherever she
could protect it without interfering with some other of her
own interests. That which other nations called a masterly
stroke of liberality and free trade, in that treaty with France,
was nothing more or less than a cunning contrivance to pro-
tect the mechanical industry of the looms of Lyons and the
splindles of Marseilles and Rouen, by allowing the silk spin-
ners and weavers of Franca to use up what was before
taken to England, and there converted into thread and
woof. Before, that was done by France sending her co-
coons across the channel to bo spun by English spinners
and woven by English weavers after it had been half
wrought on its native stem, and then sending it back to be
skilfully manipulated by the cunning fingers which near
the spot of its production twirled the flying spindles.
By that single provision in the treaty which took a third
of the export duty from the English tariff on bituminous
coal French operators saved their millions of dollars in the
cost of fuel alone with which to drive their motive power.
You are aware that all that power is produced by bitumi-
nous coal, which England furnished in ample quantities of
the best quality and at the cheapest price, and France pro-
duced only an inferior quality and at an expensive rate.
That single article in the Cobden treaty relatively protected
both France and Eugland, whilst it left other nations pre-
cisely as they then stood with reference to them. By
that article I doubt not that English operators saved more
and imposed in the aggregate a heavier duty than any
American tariff ever levied upon the importations of
England. How cunning are American economists to shout
paeans to the free trade of England and France, and ex-
hort us to follow their noble example. Will one never be
obliged or allowed to cease their marvelling at the
shallow examination of the teachers of political economy
in this country—the misleaders of the valley of the Mis-
sissippi—nay, of the whole country. Although not
strictly connected with what we are considering, I do not
know whether this is not a proper place to consult my
constituents upon a question that has always puzzled and
somewhat amazed me. That question regards the conduct
not of our Executive, but Legislative branch of the
Government upon the subject of protection. By our
constitution all export duties are prohibited. That con-
stitution was made before either cotton or tobacco were
articles of any account in our foreign trade, and was evi-
dently intended to prevent the power of checking the
exports of grain, tempted by what were then the Corn
Laws of England, which laid a heavy duty upon the
importation of all grain. But there is now no danger
of an excessive exportation nor of an excessive
prohibition by any duty upon any of the agricultural pro-
ducts of this country ; and the only qaestion for us is, Can
we by export duties increase our revenue, encourage
domestic manufactures and our foreign trade ? I admit
that, with the exception of the two articles mentioned,
cotton and tobacco, they would never be resorted to, for it
would increase the prosperity of no part of the country.
The great manufacturing prosperity of England, as well as
many other countries of Europe, is dependent solely upon
the cotton of America. It was believed before, and is now
clearly proved since the war, that other countries cannot,
or will not, produce it of a suitable kind, even at a cost of
two or three times that at which it is produced by us.
Hence it follows that an additional burden of one-half the
present native price of cotton could be imposed without
checking the export of a pound. If we then were to im-
pose an export duty of one, two, or three cents per pound,
it would be just so much tax upon the foreign merchant
and manufacturer, and so much of a clear revenue put into
the coffers of the United States. How much that would
produce, with the increasing business of the world, is
almost impossible to adequately estimate. Heretofore our
exports of cotton have been as high as 1,767,686,338 lbs.
per annum, and for years have averaged 1,501,862,198 lbs.
The increasing business of the world will no doubt
soon add one-third to these amounts, making the ave-
rage exports 2,002,482,930 lbs. per annum, which, at
three cents a pound export duty, would make $60,074,487.
The internal tax of two cents a pound is now upon our
own manufacturers ; then it would be levied exclusively
upon the foreign operators; and would be a protection to
American fabrics of five cents for every pound of cotton
produced ; and not an American would pay one farthing of
it, nor would it, by that amount, diminish the product of
the planters, who would charge it upon the consumers.
If with that protection, which upon an average, I suppose,
would be more than ten cents a yard upon all their fabrics,
the American manufacturer did not monopolise the cotton
market of the world, it would argue great want of skill
and enterprise. Besides that, it would take from the other
taxpayers of the United States the sum of $60,000,000 of
internal duties. And yet, when I proposed an amendment
to the constitution to abolish the prohibition to export
duties and leave the matter discretionary with Congress,
it was resisted by the representatives of the Mississippi
valley, who were clothed in cottons, and who ought to
have been anxious, one would think, to build up cotton
machinery ; and what was more amazing still, it was
resisted by the manufacturers of Now England, who are not
charged with liberality or in overlooking their own interests
for the benefit of others. But we return from this episode.
Various methods are suggested to redeem the Five-
twenties in currency. One very able writer suggests a
loan in greenbacks to their amount, so that afterwards the
greenbacks may be redeemed with the others. If we are
satisfied that there is not more than a sufficient currency
to do the business of the country together with its pro-
bable increase, then that would be the proper method,
without inflating prices as a counterbalance to the saving.
But if it is believed that the present and prospective
business of the country would fairly absorb an amount
largo enough to redeem these bonds as they become due,
and not injuriously increase the business, then the true way
would be for the Government to issue legal tenders equal
to the amount to be redeemed, and thus save the interest
both of the old and a new loan. Indeed, but a small por-
tion might bo issued monthly, say $4,000,000, so as to
imperceptibly affect the currency.
The business men here complain that the retiring of
$4,000,000 a month without any substitute causes a
st
market very injurious to business
I doubt not that that additional issue would
opreirnagteionncys. in the money
in some way bo taken up in the course of business without
being injuriously felt as an expansion. I may here state
that Ido not see why nearly $100,000,000 in coin has
been constantly lying idle in the Treasury, when it might
have paid at least twice that amount of the national debt. I
do not attribute any undue motives to the Secretary of
the Treasury, whom I believe to be a very great man. But
I think he errs. How specie payment is to be resumed
within the time spoken of by the department I cannot
conjecture. Before the banks can be expected to resume
the Government must resume the payment of legal ten-
ders. What means has it of raising $500,000,000, and be-
sides paying its ordinary expenses in coin, which must be
done at the same time, thereby adding 150 or 200 millions
more, thus requiring three-quarters of a billion ? The in-
terest upon the public loan, about $123,000,000, added to
the ordinary and foreign expenses of the Government,
about $300,000,000, make an aggregate of $323,000,000,
which must first be paid in coin. Of that sum $120,000,000
would n importations, and with
thethebnecpoanitdraitn,tecdoinbufrsoinmesfsoroefigthe country about a like
sum by internal taxes, making in all $240,000,000, which,
taken from the aggregate of interest and expenses, :eaves
a balance of $83,000,000. So it will be seen that the
coin revenue raised by the ordinary means of the Govern-
ment will bo insufficient to meet what is required to bo
paid in coin before resumption is touched—the difference

being 583,900,000. But if all the gold bearing bonds were

out of the way, the legal tenders would undoubtedly be
absorb• d to a very large amount by other equivalents which
the Government could furnish, and which the holders
would be willing to receive ; but the process would be a
slow one, and any attempt to hasten it would bo ruinous to
the business men of the community. My notion, therefore,
is that the sooner the Government converts all its in-

debtedness into a paper currency which the people will be
willing to accept at a long loan and to a considerable
amount tho sooner it will be able to resume specie pay-

I observe that respectable New York papers have for
the last year or two charged me with wishing to delay
the resumption of specie payment. This is wholly false.
I have been anxious to resume the use of coin as a legal

tender exclusively, not because it is any better as a token
of debt, but because it has been adopted by the other civil -
ised nations. But Ido not wish to resume by breaking
the bones of every manufacturer, mechanic, and agricultu-
rist, for the benefit of foreign operators, who have now
their fixed capital. I think that even the $4,000,000 a
month which the Treasurer is retiring will be found quite

as stringent as they can endure. I admit that such restric-
tion might beneficially cramp for a short time foreign im-
portations, because they now are introduced beyond the
means of payment. To my mind that is a recommenda-
tion instead of an objection to resumption; but it would be
an objection to many who think that coin alone should be
used in tho business of the country.

It has been said that the present national banking system,
instead of being a loss to the Government, has been a large
. _

gain, because, in addition to the amount of money paid to
the National Government by individuals, the banks also
have contributed their taxes. It bas been said also that
the establishment of national banks contributed to the sale

of bonds. Now I do not suppose that one sane man in

America believes this.

Those bonds were taken with an

avidity never before known in a national loan. 'True it
required agents and promises, as doall efforts of the kind.
But point out the man who has any money to lend, and, pre-
ferring interest to its lying idle, ever refused to entrust
this Government with it on account of the security, and
then I will admit that they assisted in the sale of the bonds.
The banks were established to absorb the bonds already

held rather than the bonds purchased to establish the banks.
But why would they help to sell bonds of the Government

and certificates of loan bearing six per cent. unless those

kind of securities were worth loss than six per cent. in-

west? if they were worth less, who made up the differ-

cute ? But it is said that, besides the banks paying taxes,
the capital pays some taxes in the hands of the holders.

If these banks had not erected yaults for the protooti,;,n of

this wrong, where would it have been hidden away to
escape taxation ? Could it have been put in any other form
less likely to be protected? They must deduct these and
other just as absurd items, not one of which can be charge-
able as an „increase to the taxation of the country. What
should have been done after the establishment of this sys-
tem to relieve the country of its burden ? By its provisions,
if the national banks deposited Six per, cent. Bonds of the
Government, redeemable in coin or its equivalent, the
Government became liable to the note-holders of the bank
to which it made its circulation to guarantee all such circu-
lation, and to make good any loss which the holders might
sustain in case of insolvency. Those bonds were to bo
deposited in the banks, not to lie idle, so far as the owner
was concerned, but to bear the highest rate of six per cent.
interest, payable just the same as if the bo-.ds remained
in the hands of the original holder. Did the Government
gain anything in the way of interest by this deposit ? On
the other hand, it withdrew a portion of them from the
taxation of the country, so far as State and municipal cor-
porations were concerned. It gained nothing in any other
way that I can perceive, but the chance of law suits,
vexation and costs, in case of the failure of the banks to
redeem their notes; and for this chance thus to'deposit for
safe keeping and distribution the $300,000,000 the national
banks were to receive slB,ooo,ooo—rather a high reward
for such a duty. If any gentleman can show me any other
advantage, either in the loss of notes or in the diminution
of interest, it is yet to be pointed out to me.

After the establishment of these banks and their palpable
injury to the country, I brought in, as I have already said,
two or three bills at different sessions of Congress, to bor-
row a sufficient quantity of money in greenbacks, and as
fast as the Five-twenties fell due to redeem these bonds
whose interest was payable in coin and principal in money.
That day has now arrived, and had that law been enacted
the outstanding Five-twenties would have been paid, not
purchased, at the rate of their lowest figure, and might
have been bought, I have no.doubt, at a much less sum
some time back. Here, then, would have been the pay-
ment of the national debt at the rate of $lOO for what is
now worth $143. The amount saved to the nation would
have been $737,645,729. Had the bill prevailed at the time
with leave to borrow the money and make the tender, the
probability is half a billion more might have been saved,
making ten or twelve hundred millions. But tender con-
sciences have compelled the nation to pay this sum in
addition to her legal debt because Mr. Jay Cooke and the
Tribune had pledged their word that it should be paid. I
have no objections to their paying it, but 1 dislike to take
the balance left me by the rebels to pay my part unless
the law requires that my trustee should do it.
How does the European creditor stand with relation to
these bonds? I have no documents here to tell me
where they are held; but most of them, I presume, are
held in Frankfort and London ; for the money lenders
there are more sharp-scented than those who were cud-
gelled out of the Temple. At the time they were bought
in gold was 281, or rather greenbacks were at that dis-
count by the arrangement of the market. Gold was made
to purchase greenbacks at the rate of about 280 to a dollar.
But suppose them to have sold at that time for 40 per cent.
—which was the highest, I think, they commanded—
what was the operation ? The purchaser paid to-day
S4CO in gold for $l,OOO, and next Monday, quarter-day,
received the interest on $l,OOO in gold, and so ever since ;
and now claims that when the principal falls due in a year
or two it shall be paid in can. This is what they call
honour, conscience, justice, through the custom of the
country, and tell the farmers of America that they were
bound to pay the money-dealers of Europe this enormous
rate to save their property from destruction, and the moral
men of New York denounce you and me and others as dis-
honourable robbers and swindlers if we do not in 40 years
quadruple the capital of the Rothschilds, Goldsmiths, and
other large money dealers. I must beg leave to judge for
myself of this monstrous proposition, and to see whether
I am bound to pay any more than he demands who, with
pistol at my breast, commands me to stand and deliver.
I do not blame the European and American holders, at
whatever price the loan was fairly obtained; but I scorn the
denunciation which would drive me to pay such enormous
rates, most probably to those who never advanced the
money, and which I was never legally bound to pay. I
find, my dear friend, I am likely never to stop—the sure
symptom of chronic old ago. But it is sweet, when you
have discovered an old friend, or made a new one, to bo
permitted to hold unrestrained intercourse with him.

Garrulity is one of the enticements to old age, if any in-
ducement were necessary to carry you to that point, which
should always be mentioned as sweetest of them all. I
advise Cicero when he again attempts to instruct us upon
the chief solace of old age, like Demosthenes, who pro-
claimed action, action as the chief merit of an orator, if he
has not already done it, for it is long since I read De
Senectute, to insert garrulity ! garrulity ! garrulity !
Yours, THADDEUS STEVENS.