The enquirer. [volume] (Richmond, Va.) 1804-1815, 1812-01-28

The last inquiry Of the committee relates
principally to the terms on which loans
amounting to at least ten millions OK dollars
per anhum, may be obtained, and TO tn.
plan proper to be adopted for the REIN
burscment of such loans.
The terms on which annual loans to that
amount may be obtained, can b. ascertaincd
only by experiment. Government has ne
yer since its organization, obtained consi
derable loans within the U. States, at I'll,
rate OF six per cent year, except from tn,
Bank OF the u. States ;and these on cap
ital Of ten millions, never amounted TO sevCii
millions in the whole. In proportion to til,
amount wanted for the service of the year,
and u the increase of stock of the public
deot 1t market, The terms must naturally
become less favorable. Ii must also be re-
collected. that in addition to the sum wan
ted TO defray the extraordinary expenses Of
the war, an annual loan equal to the annu-
al reimbursement of the six per cent, and
deferred stocks. prescribed by law, viii al
so De required. This, together with the
reimbursement Of the residue of the CONVEX
ted stock, amounting to Sos, 600 dollars, will
fpr this year amount, as has been stated in
the annual report, to 2, 135 900 dollars. AS
the interest on the existing debt is inclu-
ded In the current expenses" the loan
necessary for the reimbursement of the six
per cent and deferred stocks, will, for each
subsequent year, amount only to 100000
dollars. The loans for those sums, will in
deed create no addition to the amount of
the debt, but will nevertheless, increase the
total sum to be annually borrowed. 1t must
also be observed, that if the price Of. stocks
should sink. below par, the commissioners
OF the sinking fund are bound, by the exis-
ting laws, to apply the residue of the annu-
al appropriation of eight MILLIONS year to
the purchase of stock and that residue
will this year amount TO 3,640,OUO dollars,
which in that case must also be borrowed.
il is view of those several considerations,
which has created an apprehension tina,
loans TO such large amount might not per-
haps be obtained on as favorable terms as
under ether circumstances, and with the
powerful assistance of national bank, had
been formerly anticipated. The same view
OF the subject has most forcibly impressed
conviction of the necessity of an addition
al revenue. For if further loans be also
resorted to for defraying the ordinary ex-
Pences and the interest, they must, if at all
practicable be obtained on the most ruinous
terms. Excluding that idea, and embracing
only the loans which are absolutely neces-
sary, 1t appears to me more prudent not to
limit the rate of interest by law. A dscre-
tionary power in that respect is so far a.
iSANeCo W tuS SASSullNS, ditOHStnST lnellSl-
BILE but is preferable to tile risk of leaving
the public service unprovided for. 1t is al
so for the same reason, requisite that the
loans may be made irredeemabie for
term not less than ten years.
In former communication to the COM
mittce of Ways and Means, it was sugges-
ted that treasury notes." bearing inter
est, might, to certain extent be issued,
and to that extent diminish the amount to
be directly borrowed. The advantage they
would have would result from their beco-
ming part of the circulating medium, and
taking to certain a degree, the place of bank
notes. 1t is evident, however, that for the
same reason the issue must be moderate
and never exceed the amount, which may
circulate without depreciation.
he loans necessary for the present year,
are 1st. A sum equal to that viii CHI may, du-
ring the year, be reimbursed on account of
the principal of the debt. 2dly. The a
mount of expenses which have been or may
be authorised by Congress and are not in
Guided in the annual estimates.
The first sum will certainly amount to
3 3, 200, and may be greater if the
stocks should sink below par.
The second sum cannot yet be stated,
since the extent of the expenses which may
be authorised is not yet ascertained, and as
the estimates for the additional army, al
ready authorised, have not yet been rccei-
vedby the treasury department.
The deficit of 100000 dollars ION the
peace establishment is not included as alb
solutcly necessary, although its payment
will, as stated in the annual report, leave in
tie treasury smaller balance than, under
existing circumstances, is eligible.
itmay be proper to repeat that, SO long as
the public credit is preserved and n suffici-
ent revenue is provided, no doubts are enter
tained of the possibility of procuring, on
loan, the sums wanted to defray the extra
ordinary expenses of war; and that the
approximations expressed relate solely to the
terms OF the loans, to the rate of interest at
which they can be obtained.
The reimbursement of the new debt
which may be created, must ultimately de-
pend on the respective revenue and eXpen-
diture of the United States after the resto-
Yatiou of peace. No artificial provisions, no
appropriations or investments of particular
funds in certain persons, no nominal sinking
fund however constructed, Will ever reduce
public debt, unless the net annual revenue
shall exceed the aggregate of the annual
expenses, Including the interest on the debt.
Those who create the debt can only EST
mate what the peace revenue and expendi-
ture will be, and presume that the supposed
surplus mill be faithfully and perseveringly
applied to the payment of the principal.
The current or peace expenses have been
estimated at nine millions of dollars. Sup
posing the debt contracted during the war
not to exceed fifty millions, and its annual