Alexandria gazette. [volume] (Alexandria, D.C.) 1834-1974, 1858-03-15
state Bonds--TRItnz state Securities.


To tie editor the Alerandria Gazette
Yoo will oblige me by inserting 10 the Ga
zet,e the following article, from the Richmond
ENQUIRER, 90 the subject Of taxing State Sc
curities. There seems TO be TWO sides to this,
as II all other questions, and puohc opinion
il n. at all settled with regard to the matter.
The argument pro, however, are very well
put 10 the sutjoned, and should Ike TO see
them answered. if tbey can be. IL would
appear not to he right to allow the particular
investments of some men TO 20 scot iree'
whilst other capital Of all descri ptons is sub
iec,cd to tax-aud yet the advantages, 10 q
state point of view, are very clear Yours, re-
specially, a. ID.
"O.al! the shifts and contriVanccs which
have resulted from narrow aud tortuous
pollcy, that which taxes our State credit Is
the most reprehen.ible. Not only did the
Legislature OF 1886 arrange financial
scheme, y which the State OF Virginia should
I'M pose tax on her own bonds, but, IN adiI-
ton To THIS every munIcIpal corporation
throughout the State was permitted and 10
vitei t. lay an additional burden on our
State securit e.. We are are aware that this
system was initiated without consideration
o. toe part Of many senatJrs and delegates
that the proposers of the scheme were
probably the only men who had dIs'stad Its
pros pectlVe effect, aud that It was Instituted
FOR a concealed purpose which they ala not
venture 70 expose 70 general recognition -
Bu. when It's object has been discovered, and
its operation tested by experience each OF the
above ref ,ctl0ns al Is d new reasJn tor lis
prompt aud entire abrogatIon
Properly coniuttsd, tue system Of finance
Indicated by our present State constitution
would ali lrd the best possible guarantee OF a
llmltlcss ) are credit, which wou.d leave our
government entirely independent OF Dreign
clpi.a!, 10y reud srius State stock the most de-
sirable IL sestment which could tempt our
own capitalists Safe stock yielding an 10
teresto! six per cent, and with the payment
Of the principal within thirtyf0ur years, Sc
cured by sinking fund, would furnish the
safest, least Troublesome, and, Indeed, tue
most profitable investment which could be de-
vI-ed. The average rate vt investments wal!
scarcely yield the same interest, and every
other investment WITHIN our reach either lu-
wolves risk of the principal invested, or re.
suIrcs, in addition to the actual purchase
m)uey q serious -la many Ia'tdajs' "a ALI
absorbing, Investment OF the time and labor
Of the capitalist himself Farmers, renters
and merchants must risk tue loss hoth OF
principal aud interest, must apply all their
time and labor 10 secure profit, and when
the prof: is secured, 1t viii hardly average
annual, six per cent nett on tue first in-
yestment OF capital. Let the State creditor
have ais loan secured from aIl risk OF delay
or failure OF payment, enable BIN to devote
his lab,r to profiatls pursuits unconnected
with tne investment, ensure hun u clear ln-
teTcst OF six per cent, and IL Is matnemati-
caliy dcmonsgrable that tne floating capital OF
the State vii! necessarily compete tor invest
mert 10 the State debt uutl Virginia bonds
will become the exclusive property OF her own
citizens, Will constantly remain above par,
and afford perps.uli facility Of accoumo-
danou, limited only by the financial resOur-
c,s " our entire population,
This Is amply demonstrated by the exist
ing state uf facts. Virginia bonds are now
uu t i IN Richmond at ". Tue State aud
corporation taxes imposed on Nlrgininia SIX
es amount together TO ~ per cent. on the
bonds themse!ves--thus leaving to the stock
holder a net revenue Of only 81 60 on every
500 worth OF securities IN his possession
Now 81 60 Is the exact amount of one years
Interest, at six per cent Oh 1856, and II Nir-
ginia SKIES were now quoted ~ 765 at Rich
mond, they would really be at par. lnntead
IL, tod III IN
trEty three per cent dOoce par.
Tns Is calculation which child could
understand The inference is unavoidable,
that stocks yielding but 6O per cent. aud
standing az Y4 would inevitably Rise above
par, If the interest were raised 10 SIX per cent
And what is the result OF this tax on Stale
credit? Plainly this: the State must either
CONSENT u sell her bonds below par, aud thus
enter upon q course VII ch will tend 10 the
further depreciation VI her crelt, and tax her
citizens u pay heavy surplus IN addition 70
the amount a,tualty applied TO the bench: OF
the Stale-Or the Safe precludes her own cit
zen, from tie purchase OI stock and becomes
entIIeiy dcpeuQcut on the STICK markets Of
other States or Of foreign nations. A few
stocks indeed may fually be purchased atsec-
Jud hand by our own citizens, at prices 80 re
duccd rs to EXHIBIT the shameful degradation
Of the State credIt-and the patty revenue
derived from the tax imposed on these fur
DIsbcs the only preteuce OF benefit which can
Tesulr--a miserable satisfaction 10 be weigh
ed against the II Jury doue Il the interests OF
our own capitalists, the embarrassment and
arrangement Of our finances at home, and
the mortItyIug depreciation OF our State cred