The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1852-05-26

the question. Whatever consumes the revenues of
the property Of the State tends 10 render resort 70
taxation necessary just to the extent TO which the
revenues from property have been consumed Il is
therefore, matter Of entire indifference whether one
ranotber part of the resources Of the State is drawn
upen; for the substantial effect upon the financial
condition Of the State is the same in either case
If the constitutional provision against mourning
debts permits such scheme as this to be cffec-
tual, il is OF small moment to inquire what
it prohibits; for it provides no practical re-
straint whatever upon the power Of the Legisla-
lature. To attribute such an intention to the con.
vention or to the people, as to permit the one and
prohibit the other is to attribute to them an entire
incaTacity to comprehend the subject which they
were acting. and the effect of their own language.
1t is constituting the constitution if it were penal
statute, or a disfavored agreement in conflict with
public policy, rather than as being the supreme
law Of the State, prescribed by the immediate source
of all authority, setting bounds to the power dele
gated to it's agents. We might on this branch Of
the subject rely wholly upon the plain sense Of the
constitutional provision in question; but brief ex.
animation will serve to show that the obligations
which purrort to be created this act constitute in
its ordinary sense a State debt.
National or State debts assume q great variety
of forms. Sometimes they take the most usual
form Of private debt-an obligation to pay the
principal at specified period, with interest in the
meantime Sometimes the period of payment of the
principal is wholly at the election Of the govern
ment; while at others, the government is at liberty
to pay at any moment after q fixed period Some
times the principal is not to be paid ut ALL but only
aperpetual annuity and sometimes only an annuity
dependant on life or lives, for years In short,
these obligations assume every form which can
tempt the possessor of money to part with it to the
govern ent, and are varied from time to time, MS
one or the other seems most likely to accomplish the
purpose ofputting out promises and getting money
in return In all these forms, one common attribute
is found, and one only, viz that in consideration
of money advanced to the State the State pro misses
whatever is thought will be most likely to procure
III OeV tn IN ffnr0 nk hat. nd
that which is thus promised is debt. 1t may relate
only to the income of particular property. or it may
embrace the whole resources Of the State. The
extent of the obligation does not affect or qualify
its nature. So long as there is en- obligation u.s.
sumed by the State, it constitutes debt-some-
thing due from the State
Again, if in the natural and expected course of
events period will come when the promises made
by the certificates in question will ripen into n
perfect obligation on the part of the State, then
the issue Of them conflicts with the prohibition
OF the constitution as clearly as if the debt arose
Immediately upon their being signed. When re-
mandcrs OF revenue from the canal shall have been
received into the treasury of the State after 1854 the
obligation of the State will have become perfect
to pay upon these certificates the amount received
1t is true the payment cannot be made without fur
Their legislative action, nor could it be il the cert
Gates were immediate and general obligations on
the part of the State. An appropriation is always
necessary to effect actual payment, but the obga-
ton is as complete without the appropriation as
with it.
There is another view in reference to the obliga-
tions assumed by the State which clearly shows
that they amount to debt. The 9th section Of the
act aIproprates $4,000 to pay interest during the
first two years We have then the certificates con-
tanning, in conformity with the I'd section Of the
act, promise to pay interest semi annually, and an
appropriation to pay that interest If this does not
make complete and perfect obligation am at a
loss to conceive what would. 1t is true that the
constitution authorizes appropriations for years.
but IT does not authorize the creation odebts, and we
are not at liberty so to construe the power to make
appropriations as to bring into conflict with the pro-
hbltlon against creating debts. The appro-
Irlatlon IN this case is to be taken in connection
with the promise to pay contained in the Ger
tihcates, and the scheme of raising money in
which they form part of the machinery. Thus
viewed, the certificates, so far the two years
interest Is concerned are as complete obligations
OF the state to pay money, as the promissory note
OF an individual is an obligation upon him to pay
money. 1t is, however. to be observed that the 9th
section which makes the appropriations in question
Tor tie pay ment OF interest, directs the payment to
be made out Of the avals of the sale of the certi-
Gates, the premiums thereon and the interest which
may have accrued on the deposit OF such avas On
the other hand the 9Th section, which contains the
appropriations for two years work upon I'll canals
directs the payments to be drawn from tic same
sources, and also from the surplus revenues. If the
appropriation to the payment Of interest had been
directly from the general resources OF the State, we
nave seen that Gebt would result. Does this
indirect process alter the effect The MONEYS
arising fiom the sale of certificates are, when
received, the property of the State. They can
be paid ont only in yirtre of an appropriation
~ law. The persons who paid Thorn to the
STATE Tor certificates, no longer retain any inter.
est in or control over them The only ground on
which y distinction, can be suggested between lay-
merit fom these funds in the hands Of the State,
and from its general resources, il that such pay
ment is refundirg part Of the price of the
certificates to the purchaser Besides the an
swer that the transaction was not originally
sale of tie certificates, (for advance of money
Gu the original utterng of an obligation for the
payment OF money. is never purchase of the obi
CATION, but always loan,) it is sufficient to say
that the ground taken is not warranted by the pro-
visions of the act. The amount which is to be re-
laid to the purchaser or lender for principal is not
din inished hy these payments under the appropra-
ton N question It IS not part OF what he advanced
which be is receiving back, but compensation for
the use Of what he advanced This compensation
being payable by the State in all events creates a
debt within The narowcst definition Of that term
which wa: pressed upon US at the argument.
tremains to consider the effect of the last clause
Of the 18th section ofthe act. This provides as fol-
lows:-"lhe certificates to be issued under the act
shall in 10 event or contingency be construed as
10 create any debt or liability against the State,
the people thereof, within the meaning Of section
twelve, article seven. of the constitutions The
section otthc constitution referred TO had already
rendered it impossible that the certificates should
create any debt or liability against the State, or the
people; aud legislative provision OF this sort was
rot necessary ;or tie protection Of that instrument
Is ats eject To preclude US from inquirng whether
the certificates. or the provisions of tho net taken in
connection with The certificates purpott to create
debt or liability against the State or the
people thereof I! We think not. II does not
alter, on profess to alter, any one provision Of
tic act It leaves them all standing on the statute
book, with tic apparent force Of llw and with the
sanction OF legislative approval, forming together
single scheme fer raising money, on the faith of
which capital is invited to assist the State Under
this state Of things, car we be asked to take the
ground that the State is to be regarded rs coming
into the money market, with cunningy devised
plan OF promises, seemingly oiiicacous but really
known 10 be wholly unlawful and incapable OF con-
ielring any legal right, and by such means seeking
to procure the advance of money? The respect
winch we owe to the Legislature forbids us II listen
fer one moment to the suggestion The claim in
question is only a legislative doca: alton Of the
meaning Of the constitution, and an Injunction
uron tie courts to construe the act accordingly.
II it were TO hc regarded by US, and such eite i
given TO il rs Is contendcd Tor then the most
fragrant legislative violations Of the constitution
may always be screened from the scrutiny Of the
courts by the addition Of this sintle clause ain.