The daily union. [volume] (Washington [D.C.]) 1845-1857, 1847-11-30
THE u MON



the Union
Treasury Hstss.-Ne. 9.
We may profit il we are 80 disposed by our exye
| rience during the war OF lsl2-r5.
That war begun under the supp0sition that banl
credits would afford US the means Of carrying il on
tThe bank capital has been stated al seventy FIVE mil
lions said the Committee of Ways and Means OF 1914
On tins capital we may calculate with safety on cir
culauon, IN notes and discounts, OF one hundred mil
hons. From this sum deduct SAT ,569, 1870, the maxi
mum OF what IS necessary for circulation, and the sun
reniaIllng-vH, 500 400, ss0-constuies the ability o.
moneyed capitalists to loan. Oh this propose
In conformity with these principles, says his toan
about SIX millions were borrowed in 1872 from the
banks, and about four millions from those who
had obtained from the banks the means OF lending
These loans were obtained at par. In the next yea
the government borrowed about twenty millions, fo
every hundred dollars OF which issued certificate o.
stock Tor one hundred and thirteen dollars In the FOL
lowing year borrowed about fifteen millions Tor twelve
millions of which stock issued al the rate of one
hundred and twenty 1--WE dollars for hundred paid in
Then, as Mr. lngham said IN Congress, at seemed I'M
possible TO borrow any terms
As an auxiliary means OF supplying financial wants
Continues the hstoran,) emissions made OF treas
ury notes bearing an interest OF five and hfhs pei
cent. per annum, Teimbursable payment for duties
taxes and public aads OF these notes. nearly three
millions were issued IN si2 about SIX millions in 1919
and upwards Of eight millions in lsl4.
The result was, that IN less than two years all the
banks that had been active in making loans 10 govern
rnent suspended specie payments. And government
after having incurred stock debt of about forty five
Millions and treasury noe debt of about seventeen
millions, found IL impossible borrow any more even In
the paper OF banks deprecated many per cent below par
The evils of this system did end with the war; for
the same principles OF hnance persisted In after the
war was brought 10 close.
The bona fde revenue of government fsr the year end
ing December 3lst, lel5 was only fifteen million
hundred thousand dollars charges on government
suring the same period amounted upward OF tynine
Of state exert those powers OF financial metamorphoss
which the funding and treasury system gave them,
that there was at the end OF the balance in the
ury of upwards oil thirteen millions OF dollars
The grand secret by which this balance produced
was that oil exchanging treasury notes OF which bore
interest nconverbe bank which bore no inter
est The officers OF the seemed highly pleased
Guilty in applying the balance whe was most wanted
But little OF the money would pass current thirty miles from
the seal OF the banks that issued IL and paying the discount
was clear loss government the creditors of govern
menf
Receiving inconveribe bank notes and treasury notes
IN payment Tor duties, land, and taxes, gave u.s. OF
course, an abundant tnominaD revenues but this did
put end to financial troubles, TO those which
the people al large sustained in consequence thereof
During the year ending December 3isi, 1916 the rev
of he United amounted to The enor.
nous OF fortyepen million dollars But, with all this
ment Mr. Wm jones' the first President OF the United
States Bank, gives the following account OF them,
50 The public treasury exhibited phenomenon in
finance. Many millions Of surplus revenue, many
different values there offices of collection,
valuable and applicable only where was collected while
the great OF public debt and pendtures al those
the quarterly interest the public debt due where
most valuable could not be bur BY
evidence OF debt in the form off per notes;
thus creating invidons distinction well between the
debtors the creditors OF the public, many
ceeing the OF their respective
claims The market value of the paid the gov
eminent was made 10 hnctuate according to the arbitrary
decisions OF banks and intrigue, ofbrokers
sin this situation the State banks which had been EN-
ployed repositories OF the public money withheld the in
disensable facilities OF exchange for the payment Of
public creditors and finally refused pay the balances due
by them bur in the ordinary of public expenditure
their respective places OF location, claiming, under
ons groundess pretexts the Indulgence of government
while the received by then, OF
the United States the paper Of banks which did
pate in the public deposes, enabled them coutrol
these banks and proract their efforts specie
Tnents."
Such was the state Of affairs that though there was
ernment compelled to borrow five hundred thousand
dollars from the United States Bank in anticipation of
its regular operations, 10 pay the interest the public
debt at Boston the first of January, 1917.
All the pecunary troubles the people of this country
experienced from 1914 to Is2sand they were such trou-
these pecunary troubles had their origin in the
system Of policy adopted in the war OF lsi2-'l5.
The grand errors IN this system We're
1st The neglect to provide, at the very mencemen,
of the in gold and silver sufficient pay
the ordinary expenses of government and the interest
the public debt
I'd The dependence placed bank credits to perform
functions for which bank credits are not adapted
3D. The issue OF treasury notes quantities,
and especially those OF small denominations and bearing
interest The issue OF these made great part OF
what revenue was received unavailable for most public
uses.
II we do not avoid similar foles during the present
war; shall prove that belong TO that class OF
whom not the severest lessons OF experience
have the smallest effect THETA