The daily union. [volume] (Washington [D.C.]) 1845-1857, 1847-12-07

The Fluui.ces.


The FluaIces.
Theta closes his interesting series this evening The
summing up is worthy Of his experience and sagacity
political economist We advise the reader save the
paper for future reference II embraces series OF propo
stons which may be found of some importance and APP
plicabity hereafter The question may up during
the present session of Congress- when this exposition may
be interesting.
! For the Union
Trcgkury NOTES.-The. 8.
As considerablshime has elapsed between the publ
cation Of the irsand the last part Of this SERIES it is
proper to E%ea summary of what we have said
| The proposal OF New York wing editor, that gov
eminent should issue treasury notes in small denomina
tiops and bearing no interest," to the amount OF fifty mil
lions was what induced us to commence these essays
but in continuing them, have endcavored to expose
other schemes almost as wild, and almost as foolish
which we have met with IN print or heard advanced In
| conversation.
! We have proved to our own satisfaction at least
L. That the issue of treasury notes of small denom
nations, and bearing no interest, to even much less
amount than proposed by the New York editor would
be productive OF the most pernicious consequences
| to both government and the people
g. That such notes would either dispace gold and sill
and convertible bank paper, else form an addition
| to our present circulating medium.
| g. That bank notes are so connected with the gene
raj business OF the country and especially with the
system OF discounts and depostes, that they cannot
long specie payments sustained, be 10 any great
extent suppanted by government paper money.
|
and bearing no interest," as might be issued, would FORM
for time at least addition to present circulating
medium and that they would be regarded by many Of
the banks being Gas good gold and silver they
would become the basis OF new bank issues.
s. That the process of initiating the currency has al
ready been carried as far as is prudenthe current cred
its OF the best banks being now greater than they
were in ''the year of folly'-that is, in 1s36-'37
g. That if any great addition should be made to our
small treasury notes. by any other MEANS suspension
of specie payments could be prevented in no other way
than by such contraction OF bank accommodations
would press heavily on the community.
| T. That Judging by the experience of the banks the
whole amount OF treasury notes OF small denominations
which could be kept al par with SPECIE would be in
on average but seventyhree days. those of the banks
of Connecticut but sixty days; and those of the banks Of
the large cities Tor much shorter periods To sustain the
currency of these notes, necessary to redeem them
| five six times if not oener in the of each
! year.
s. That sustain gross circulation in bank notes of
l05 millions, the banks OF the United States require
gross annual revenue of at least $40 millions In the
same ratio the government, on revenue OF thirty mil
lions could keep in circulation at par only five millions
O. That in order to keep their notes at par, the banks
require not only the enormous amount OF in-paymens
above stated but have to keep on hand large amount
Of specie that the nett circulation of the banks,
and above gold and silver In their vaults, but little
more than fifty millions.
| 10. That small treasury notes would have advan-
tage the paper OF the local banks nasmuch they
would be receivable everywhere in payment OF public
dues. But they would have no advantage whatever
over the paper of the late Bank of the United States
that not only receivable everywhere for public Dues
but payable in specie demand. And yet, notwith;
standing it did business to the amount of hundreds of
millions in each wear, the whole amount of paper the
had the public eposites, exceeded average, the
amount OF specie in its vaults in less than four millions.
Il That with such facts as these before us, it would
enter into competition with the banks for the profits
arising from the manufacture of paper money
IL. That, with revenue in gold and silver the gov
| Qg mn ali ty tn
borrow when it resorts to the circulating paper sys
tenn When government receives treasury notes in pay
men OF public Dues it simply redeems that amount of
floating debt and the whole advantage gained is equal
only to the interest for the time the notes have been in
circulation With revenue OF one million in gold or
silver government has the of paying the interest
twenty millions of stock debt at five per cent and on
upwards of sixteen millions at six per cent
10. That nations that wish to borrow may learn wis
dom from the experience of the British government 1t
has been in the habit for than hundred and fifty
years. of issuing exchequer bills treasury notes. and
1T seldom has afoat less than one hundred millions in
such securities But 1t allows such rate OF interest,"
that few of them paid in for duties taxes
and by steady adherence to these principles Of policy it
has supported lis credit during the most expensive
and under an accumulation of public debt amounting,
in the aggregate to more than four thousand millions
IA That though some people cannot. and others WW
not, it, there most important difference between
treasury notes of large and small denominations, and
between treasury notes bearing interest and bearing
interest Treasury notes of small denominations. and
bearing interest," are, in point of fact, governmental
paper money, and tend to drive gold and silver out Of
circulation Treasury notes of large denominations and
bearing interest, investments and, though not free
from objection, not objectionable than other
forms OF public debt.
49, That treasury notes of large denominations, even
when they bear interest, do not dsplace gold and sill
but merely substitutes for private bills of
exchange.
l6. That government is prevented by law from pur
chasing private bills OF exchange and from transferring
require by means of treasury drafts the of treasury
notes indispensable to save the expense Of unnecessary
Interpretations of specie But that the issue of treasury
notes of even the largest denominations bearing inter
est ought to be strictly limited to the amount necessary
to effect such transfers
IL That il any change is made in the system, it ought
TO be one calling IN all such notes bear interest in
asmuch as those bearing interest will answer equally
well In eecng governmental transfers, and other
purposes besides.
Is. That treasury notes. properly managed to the
government more valuable in many instances than gold
and silver, insomuch it by means of them effect
payments at distant points with prompttude that would
otherwise be impracticabe; that they aso in many
instances. valuable to the public creditor, mas
much order to receive gold silver any of the
great centres OF trade may be valuable to him than
gold or silver the spot where he resides and that
therefore, treasury notes ought to he economical by gov
eminent with quite as much care as economies gold
and silver. Irt ts 's.-
10, That by means OF treasury notes. government can
borrow Just such it wants, at just such times as
wants, and pay interest only the and from
the day on which it borows whereas, under the old
system, used to be paying interest large sums lying
IN deposlte IN the banks or, speak with precision on
mere inscriptions to its credit the books of the banks
20 That IN borrowing by means of treasury notes,
government avoids causing those arrangements Of