Daily Ohio statesman. [volume] (Columbus, Ohio) 1855-1870, 1861-12-27
Gbe Obio 9tatesnram
The Proposed Paper Currency.
EXCHANGE PLACE, New YoRK,l
December, II. 1861.

ltWould be difficult for the historian to fur
niah an illustration OF nation reduced TO more
complete state of prostration, so far as its i'm
mediate means of self-preservation were con.
cernedi than was the United States of America
az the time the present Administritio assumed
the reins OF Government. States had seeded ;
forts and arseDals belonging to the Government
had been seized; tried and it was supposed trust
worthy servants had turned traitors; men hold
Ing high positions in the Executive Departments
had proved faithless; the army was feeble; the
navy demoralized; and the country's credit 40
far shaken that capitalists were hesitating
whether or not to complete q half perfected loan
Of million dollars, for which tho Government
had previously contracted.
A space of ten months has elapsed, and, in
the midst OF a most formidable revolution, with
decreased revenue and deprecia,ed lands, an
army OF upwards Of six hundred thousand men
hasbeen levied and maintained; naval feet
and armament, bidding fair to equal these Of the
most powerful nation upon the face fthe globe,
cover the waves; and loan of nearly two humid
red million dollars, without the necessity CT
having recourse to foreign capitalists, has been
effected. The Administration under whose
auspices such astounding results have been &C
complished is surely to be rewarded with the
gratitude of the American people, and its views
as to the future policy OF the Government are
entitled to all the confidence which its past sue.
cesses have so eminently deserved.
In order to maintain the army and navy which
have been raised, Necessary as they arc to re-
store the Union and enforce the Constitution
and laws OF the land, the expenditure Of large
sums OF money, far exceeding the ordinary re-
ceipts OF tho nation, Is required. The Secre.
tary OF the Treasury estimates that these ex.
penditures during the present year will exceed
| nj 10 nd
isting laws, by sum amounting to more than
two hundred millions Of dollars; and if the war
should last another year, he estimates the ex-
cess OF the expenditure over the receipts during
that year at nearly three hundred and eighty
million dollars. These enormous sums must be
provided in some way; and unless they can be
! procured as loan by the Government they will
, have to be raised by direct tax upon the peo-
pie, measure fraught with great hardship, in
asmuch as 1t would diminish largely the accu-
mutations of Industry without any promise OF
restoration or compensation.
1t would seem Idle, in the present state Of
affairs, TO found any reasonable expectations
upon procuring the aid of foreign capital. The
theory entertained by leading men abroad is,
that ours is Government which must sooner
later fall; that there is in 1t an Inherent weak
ness which must cause it to fall to pieces of
Itself, aud they regard the present rebellion aa
the natural consequence of that defect, and Gs
the premonitory symptom Of dissolution. En-
tersainiDg such views of the nature OF our Gov
ernment, il is not at all likely that they will
consent TO risk their capital upon its stability
until that Government shall, by the exhibition
of some undeniable exercise of strength, prove
to them conclusively that their views are elro
neous. These enormous sums of money have
then to be raised from our own people either by
loan or taxation. The latter method is not to
be thought of. II would not only amount to q
conhscation Of large portion Of the property
of the people, but it would Withdraw from the
ordinary channels of trade nearly all the specie
circulation of the country. They must then be
borrowed, and tho Government has no option ai
to who shall be its creditor. That creditor
r must be the people of the Northern States.
Butho ara the people of the Northern State
/ to be induced to loan the Government sucl
large amounts2 They already are creditors @
J. the Government to the amount of nearly two
hundred and fifty million dollars. Nearly al
the capital which would seek permanent in
vestuent in Government securities has already
q been absorbed by previous losns, and the people
!, at large cannot take ther money from the ordi
It nary pursuits of business, yielding them largt
= profits in proportion to their investments, anC
r live like retired capitalists upon the interes
II they may draw from the Government. Tht
banks could not supply 60 immense demand
because they could not find ready customers fo
the bonds, now that permanent holders hay,
Y been supplied, and the bonds themselves, no
|, being really needed for purposes Of investment
q would only be purchased by spectators a
J. prices far below their real value; they would b.
rated in the list Of fancy stocks. 1t would thel
seem to be impossible to raise so large al
amount from an apparently exhausted creditor
= But the Secretary Of the Treasury, with tina
!, gigantic mind which has stamped him as th
y y man of the age 10 financial matters, has aread
!. grasped the difficulty with masters hand, an
It has suggested plan which will, if it meet
= the approval of Congress, not only relieve tn
Government to great extent, but confer last
Ing benefit upon the people, and be attende
with fewer instances of individual hardshi
q than is usually the case with laws effectin
- general changes of any kind in a community
The merit of this plan is In the fact that it doe
9. not drug the market with United States securi
/, ties, but creates demand for them sufficient I
meet the necessities of the Government, unit
a more favorable aspect Of affairs may rende
it less dependent upon Its own immediate sur
porters for assistance. In order to fully con
prehendlthe advantages of the system proposed
it will be necessary TO refer briefly to porto
of the past history of the nation, that we ma
furnished to US.
During the major part of the existence OF th
Republic the funds of the Government were d.
posted with on institution known ss the Unite
States Bank. This was corporation having
limited number of shares, deriving it's power
from o charter granted by the General Cover
ment, and having branch for the transactio
OF business in all the principal cities in ii
Union. Its functions were the ordinary ones
banks, issuing bills, receiving funds on deposi
discounting notes, and effecting business nj
only in domestic but foreign exchange In i
charter the Government stipulated that durin
the existence of the Bank no similar inetitutio
should be organized; 1t was Itself q stockholdt
In the Bank, and had the power of appointin
certain Of the Directors of the Bank This il
> stitution was organized and maintained upC
the principle, then admitted, that 1t was NJ
only the power but the duty of the Governmel
to furnish to the people reliable and unifor
paper currency; that such currency was nece
n - sary in every business community, and, belr
necessary, il was as much the duty of Cover
ment to give its citizens one that would be
equal value in all parts Of the Union as il W,
to give them fxed metallic currency. Nume
GUS objections were, however, made against th
Bank. 1t was complained that with the aid
'' the Government funds II was epabled to owe
bid private dealers in the purchase of foreit
II exchange; that Its vast monetary influence W
capable of being used, and in fact was used,
corrupt National Legislatures and subject Il
Government to the dictation of mere moneyt
| aristocracy; that 1t gave unfair advantages
the foreign over the domestic stakeholder; aI
- that il savored of favoritism in the Governme
N to give to the private stockholders Of a sing
~ loornorat tim the Immense ad vantapes To be d