The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1866-03-27
LOAN BILL.

! I -smo. a LOAN BILL. M ..-.+.I
| '.- s1ain9it Cl-----. ~ 5.1H .Jt .,....e
Speech of Hon. John Lynch of Maine
IN THE HOUSE OF REPRESENTATIVES,.
| H -'45e. March 16, 1865 1a -s sat
The House having under consideration the bill to
amend an act entitled san act to provide ways and
means to support the Government" approved March
| 8, 1866
| Mr.. LYNCH said: ilfr. l.tlr.
Mr.. Speaker: The bill under consideration
extends the authority of the Secretary of the
Treasury SO far as to allow him to retire the
United States legal tender notes, which now
constitute SO large a part of the currency oil
the country, and which are the only "lawful
money" in circulation, and to substitute there
for the bonds of the Government bearing in
terest in coin. The bill also provides that the
bonds which may be disposed of elsewhere
than in the United States may be made paya-
Die IN the currency or coin of the county
wnere they may be made payable. These are
prleny the powers which this bill proposes to
confer upon the Secretary. Before consider
ing their nature or the question of their neces-
slty, let us see what powers that officer already
has under existing laws The act of June so,
1864, authorizes the Secretary of the Trea-
sury- -
ZIP redeem and cause to be Cancelled and DESTROY
ed any Treasury notes United States notes hereto
lore issued under authority OF previous acts of Con-
gIess, and to substitute in lieu thereof an equal
amount OF Treasury notes OF other United States
Under this act the Secretary has the power
to convert every dollar OF the legal-tender cir
culation into, seven-thirty Treasury notes, or
into compound-interest notes. Further, the
act Of March 8, 1865, provides that "any Trea-
sury notes or other obligations bearing inter
est issued under any act of Congress NAV, at
the discretion of the Secretary of the .Trea-
sury and with the consent of the holder, be
converted into any description of bonds au-
thorized by this act" This authority covers
nearly half the entire Indebtedness of the gov
ernment The Secretary, under it, has the
power to fund the entire issue of seven-thirty
Treasury notes, amounting to $3.50, 100000; I;
the three-year compound-interest notes,
amounting to $1S0,O00,000; the certificates of
Indebtedness, amounting to $60O00OOO; the
one ana two-year hve per cent. notes amount
ing TO 600, and the temporary loan, bear
ing lpur, tive and six cent. interest, amount
ing 70 Sll5, 900, making a total OF 81, ,193,-
OOOoUO which existing laws authorize the Sec
retary OF the Treasury to fund at his own dis
cretion. 1t should be understood. however.
and it is due to the able officer at the head OF.
the Treasury Department to have it well and
fairly understood, that the authority con ferred
by the act Of March g., 1866, is, after all, lin
tied TO an extent which seriously interferes
with the process of funding thereby authoriz-
ed. The necessity of funding large portion
of the floating debt of the government is L
/ thinks universally admitted, and the Secreta-
OF the Treasury, therefore, should be clothed
with explicit power to make this change In
the character Of the debt, in the safest. least
expensive and most practicable manner In
doing this, however, would not have the dis
tinction lost sight of which SO clearly exists,
and which is SO universally recognized be-
tween the bonds, Treasury notes and other
interest bearing Obligations Of the Government
on the one hand, and the United States legal
tender notes on the other. These latter are
the lawful currency of the country they are
not mere promises to pay money, but money
itself E"lawful money"-capable of paying
debts, and answering all the uses of money
in making. exchanges within the country.
The interest-bearing portion Of the public
debt is payable at certain dates, and. must be
provided for at maturity. The Secretary of
the Treasury is the guardian of the public
credit. On him devolves the duty of provid-
ing for the payment of these maturing obliga-
tions He has the responsibility, and should
have power Commensurate Herewith. ~ 20
The limitation with reference to funding.
which have alluded to as existing in the act
Of March 3, 1866, consists in the fact that the
Secretary OF the Treasury can only fund Gov
eminent obligations in one way In other
-by i1 f6e sale of bonds and to Apply the same
to the funding of the floating debt. He can
fund only SO fast as an exchange of one class
OF Indebtedness for another can be effected.
lis can hold out no inducement for speedy
conversion of such obligations, and is there
by hampered and embarrassed in his opera
1tions hope, therefore that the law which
now gives this power under limitations may be
SO amended as to confer it upon the Secretary
OF the Treasury without restriction. Whether
it is or is not best to continue, so far as it can
be done, that portion of the debt bearing in
terest IN currency in its present form, thereby
preventing it from leaving the country and
fastening the day when the Government
may be able to redeem its circulating notes in
specie by reducing the amount of coin it will
be obliged TO pay out for interest, are ques-
tions to be settled by the head of the Treasury;
and am ready to vote for the bill reported by
the committee, amended only SO as to prevent
tina funding of Notwithstanding into in
gterest-bearing obligations. 6ua,8 ~ 4 1el5u.
But am. as have already intimated, OPP
posed to comforting any power upon the Sec
retary of the Treasury to contract the volume
OF the national greenback legal-tender cur
rency. The exercise of such a power is not
necessary to facilitate the funding of the in
terest-bearing debt; indeed, it is acknowledge
ell that it would retard it not defeat that most
desirable object 1t is said that the Secretary
could not if he would, and would not if he
could" contract the currency, but that it is
necessary to hold this power suspended In ter
TOrefn over the business of the country in order
to prevent speculation. In answer have on
ly to say that if the people of the country are
not competent to manage their affairs they
will not be benefited by any governmental
guardianship which may be placed over them.
D 1t should be borne in mind that $1S2 000,-
600 Of the United States currency afloat about
one-third of the total amount in circulation,
is in the compound-interest notes, which ali
agree should first be retired. The Secretary
has not only the authoritsbut the power, II
he deems it prudent to exercise it, to call
these in at any time. They never pass for
face value andinterest, and ethe Government
can at any time exchange its bonds for them.
and yet the most determined advocate for con-
traction does not pretend that it would be
prudent to withdraw them all from circula-
tion in less than about two years. have
heard noione who favors contraction intimate
that it would be prudent to contract more
than $l0OOO0,OOO per year. iai.nl taIw9mos A.
| hO Why should we confer on we know not
what Secretary of the Treasury power and
autnoIily WHICH Wouu extend beyond two,
years from this time? Congress meets twice
withintha period, and if it is found that the
experiment is safe one, and that it is pru-
dent to continue the contraction of the cur
lrency beyond the amount of the compound
interest notes, the authority can be given
We can confer additional authority by subse-
quent legislation if it is found necessary, but
are we quite sure that we can withdraw it
when once conferred ? May we not find it as
hard to repeal a bad law as it is to enact a
good one? How many men on this side of
the House would consent to confer this vast
power, which subjects the entire business in
terests Of the country to the win or caprice of
one man, providing that it was known that
the able and upright officer now at the head
Of the Treasury Department would not hold
his position for sixty days, but would give
place to some unknown successor? Can any
man say that such contingency may not