New-York tribune., 1841-11-20
Erie Enlargement.

UTICA NOV. 10, iCti'
5 N DEXTER, Esq, Canal Commissioner:
DEAR SIR: Much misconceptions exists in rela-
tor 10 the price at which our State borrows money.
Five per cent. Stock payable twenty years hence,
cannot be sold for more than about 81 dollars for
100 dollars of stock This is supposed to cons-
mte loss TO the State of 10 dollars every 100
dollars borrowed, and this suppostion is the error
which wish to dspel.
Suppose the State shall sell for only so dollars
100 dollars of per cent. stock, payable 30 years
hence. The effect will be that the State is paving
dollars the year interest for the use of so dollars.
This j. only "a per cent interest the year on the
30 dollars But the State will, al the end of 20
years have to pay only the 80 dollars received
for the stock, but 30 dollars in addition. What is
this 20 dollars worth Just such sum as will,
il placed at compound per cent. Interest for 90
years, amount TO 90 dollars. This sum is 5 dol
lars l6 cents and mills.
The State, therefore, is selling such ) per cent
stock so dollars is paying Ct per cent. interest
the wear the 80 dollars borrowed, and giving In
sddilion present bonus of dollars l6 cents and
{ mills The said bonus is by the we'll known
process of arithmetic, worth annuity of As cents
mills for 90 years. which, added 10 the 5 dollars
which The State pays annually for every 80 dollars
borrowed is dollars 40 cents mills. The IN
tcrest of 80 dollars at pcr cent the year Is , dol
lars co cent. Hence the State pays II cents a
mills the year less than : per cent. on every 100
dollars borrowed.
We have been accustomed, in years past, 10 see
cur State Stocks sell at much higher price than
they Will now sell far. This an accidental
benefit derived from the salea5eness of our stocks
In Europe where money Is worth much less inter
ca, than II is with us This accidental benefit the
feelings os Europe, and perhaps ether circumstan-
Ccs have deprived US of; but "a tho State can still
borrow money at the legal rate OF interest, ond
even at a li,le less, we have demonstrated, the
State is eyidently not paying more for money than
cur laws asd the experience OF every b-dy deem 1t
to be worth hence no good reason seems 10 exist
Tor aggrRva,ng the loss Of our former accidental
advantages b, voluntarily inficling on ourselves
the positive evil Of refusing 10 borrow at the pres
ent rates, II we can employ the money Frohtaoly'
How lar the public Improvements IN progress
should be continued with money obtained al tue
present rates, Is question which our Legislators
must decide. No good abstract reason, perhaps,
ever existed why our State should be able 10 Dor
row money on better terms Than q private indi-
yidual who can give uAdoubted security. The
State can now borrow on such terms, and we may
wait in vain for the period TO return when Europe
will again enable US TO borrow on better terms
In relation 10 the public improvements now in
progress the interest on the money already ex-
pesded on thers, amounts TO about half million
OF dosrs annually. This sum will not only be
Hcssurably unproductive Till the whole of the in
p'Ovemenl, are completed, but the sum keeps
ssninualy augmeniing BY the accretion OF interest
on The said half million lost Annually BY this
process delay OF ten years in the completion OF
The said improvements, will add te their cost but
S'rife short OF seven millions OF dollars. Were
these Improvements the property OF private eit'
zen, such calculation would influence his conduc
Greatly; and know of no reason why hike COR
adera,ons of pecuniary profit and loss should moi
influence States. a. b. JOHNSON.
l0acd4 Wing.