The enquirer. [volume] (Richmond, Va.) 1804-1815, 1809-07-04
REPORT.
TREASURY DEPARTMENT,
June goth, 1909.


June goth, 1909
SIR,
I have the honor, in obedience to the resolu-
tion of the III. of Representatives of the 18th
inst. to transmit copies of the folio wing slocu.
ments, viz
A. Proceedings of the commissioners of the
sinking fund, at meeting held on the 18th of
March, 1909. directing the application Of sum
not exceeding 2,2s0,O00 dollars, TO the re.im-
barsement OF the principal of the exchanged six
per cent. stock, and authorising the secretary of
1he treasury to borrow, with the appreciation of
the President fthe United States, and i'm Con.
tormty with the provisions of the 10th section
Ofthe act, making further provision for the sup.
port of public credit, and for the redemption of
the public debit" sum equal to that of the prin.
ciPat 81 the exchanged six per cent. stock, which
might be thus reimbursed.
Is. Letter from the Secretary Of the Treasu.
ry to the President Of the bank of the United
States, dated 2ist of March, 1909, inquirng
whether the proposed loan might be obtained
from the bank and also whether the bank
would assent to contemporaneous reimburse
ment the whole amount of exchanged six per
cent stock owned by that institution.
{. Answer of The President of the bank of
the United States, dated Oath March, 1909 );
stating, that it appears to the board of directors
that they are not authorised by the act of 1895
10 make loan Tor the reimbursement of the
stock created by the act of 1907 that the bank
will agree to the loan, provided it is not wanted
for more distant period than the time wien the
present charter Of the bank will expire, and pro-
v,ded also, law be obtained giving them au
thority to make it; and that the board prefer a
reimbursement of only so much Of the exchang-
ed six. per cent. stock which they own, as may
tail to the lot ofthe bank.
~. proceedings OF the commissioners OF the
sinking fund at meeting held on the Goth Dec
1873, authorsing aioan of 100000 dollars pur.
suant to the first section of the act abovementi.
oned, passed the third of March. 1875
. +. Contract with the bank of the u States,
uated 3lst December, 1875, for lo;H of SOC, 600
dollars obtained from that institution, in pursu
ance OF the last mentioned proceedings of the
commissioners of the sinking fund.
\. Proceedings of the commissioners of the
sinking fund, at a meeting held on the 18th
dollars, pursuant to the provisions of the act
above mentioned, passed the Sd of March, 1875
o.. Contract with the bank of the u States,
dated 18th December, 1913, fer loan of 200, 600
dollars obtained from that institution, in pursu'
ance OF the last mentioned proceedings of the
commissioners ofthe sinking fund
No other loans have ever been obtained under
either the first or tenth section of the act of Sd
March, 1875 /; nor can find in the minutes Of
the commissioners of the sinking fund, any other
proceedings touching the exercise or constr,lc-
tpon of the duties or powers contained in those
sections.
itappears by the document (A) that the COM
missioncrs of the sinking fund, at their meeting
OF the 18th March, 1909, construed the words
oBolic aebt' in the 10th section of the act of 9tl
March, lI93, as embracing the exchanged six
per cent stock and considered the section gen.
morally as authorisng them TO borrow, with the
appreciation Of the Pres dent, the sum requisite
LOT me reimbursement OF that part of the princi-
pal OF the public debt, ifthere was in their opi
mon, reason to apPrelicndthat all the demands
on the treasury, including such reimbursement,
could not be discharged, unless . loan to that u
mount was obtained.
l. The commissioners 0f the sinking find did
not decide, that the words public debt" in that
section, coDpre Bonded any debt which did not
exist on the 3rd day of March, 1895, when the
law WAS passed nor even any portion OF the debt
tnen existing, which might, Gas in the case of
the three per cent. stock converted by virtue of
the act OF 11th Feb. 1907, into six per cent
.stock,) have been subsequently altered either in
the amount OF its capital or in the rate of inter-
est payable thereon. The construction which
they gave to the law applied only 10 the six per
cent stock issued, By virtue ct the act OF 1Ith
FEBRUARY, 1907, IN exchange ofthe odd six per
cent Or deferred stocks. No alteration whate-
Yer was produced by that exchange, either i'm the
amount ofprncipal, in the rate of crest or il,
the manner OF transferring the debt Tie onlv
change is the manner in which the principal
should be reimbursed, and that certainly did not
Hiee. the ua'ufe OF the dept lniS exchanged
stock is therefore, in the opinion of the commits
sfoners, precisely the same debt which existed
an March 1875, and to which the pewers vested
IN them by that act are strictly applicable But
although the grounds which different oDini-
ON was entertained by the bank, are not to this
moment understood 1t appeared eligible, in a
case where doubts were suggested, to apply to
Congress for an explanatory act, and in the mean
while to suspend any further proceedings res.
pecting the proposed loan. The resolution of
the commissioners ofthe sinking fund has not,
therefore, been yet submitted to the President Of
the " D for his appreciation.
III. The commissioners of the sinking fund
arc, by the 10Th section of the act of SRI March.
l7e5, empowered and required, if nccessarg. to
borrow with the appreciation of the President off
the U. S. the sums requisite for the reimburse.
ments ofthe principal of the public debt. The
general expression necessary" have been Ia.
ken by the commissioners as coi,fning the power
thus vested in them, not to the case when the
sums which they are directed to pay annually
might exceed the probable receipts into the trea-
sury tor that year, but to that of those receipts
beng Insufficient 10 discharge all the annual ex-
Penditures, including the payments of the sink
ING fund The question of priority of payment
IN favor OF tatf fund was not taken into co,ide.
ration, because, although the obligation to pay at
Tins time eight millions of dollars annually on
that account is indlsputabc, it is equally nccessa
~ that all the other expences authorised and d.
rected by Congress should be paid The mean. !
uig and object of the section appeared indeed so
obvious, that no dnubt had suggested itself on
that subject previous to It's late discussion.
The first section of the act authorizes the com. |
as..V. RI Ill.