Daily Ohio statesman. [volume] (Columbus, Ohio) 1855-1870, 1866-03-16
.QDblo Statesman.
CORRESPONDENCE.
The Radical Controller OF the Trens-
urer VS.. Secretary mcCuIlOch-The
state of the Treasury a Matter Of
Dispute. H.. .u
Treasury DEPARTMENT.


TREASURY DEPARTMENT,
February "a, 1856.
MY DEAR SIR:-Your letter of to-day is
received, and in reply l have to say that l
am decidedly opposed to the Loan bill, for
the following reasons: .,e
By the act of June 30, 1894 United States
notes can be converted into compound-in-
terest notes; and by the act of March 3,
1865 certificates Of Indebtedness, com
pound-interest notes, five per cent legal
lender notes, and seven-thirty Treasury
notes can be converted into five-twenty
bonds; and that portion of the temporary
| loan that it is desirable should be paid, can
| be paid from money now in the Treasury,
which we suppose must be at this time, in
cluding deposits in National Banks, at
least $150,000,000, and the amount that it
would be eXpedient to pay would not be
more than the amount of the increase OF
| the deposits for the last few weeks, and
which the Government has not had any oc-
casion to use. We have, therefore, full
powers to fund every dollar of the floating
debt without any further legislation on the
subject, and no occasion for making any
loan for any purpose whatever. All can be
done by simply exchanging one security
tor another and can be quietly done with
out essentially disturbing the money mar
ket or the business of the country-the
Secretary of the Treasury being the judge
as to how far and how rapid the movement
in reference to conversion should proceed.
| think there is no doubt about the will
ingness of the holders of the floating debt
to convert into iive-twenty bonds 10 the
extent that is desirable, if the credit of our
securities is sustained; but if authority is
given to put bonds upon the market to an
almost unlimited amount, and to sell at any
price, as provided in the bill, would, in my
view, cause such uncertainty in the public
mind as to render it impossible to keep Yp
the price of the Government securities. u
do not think a loan of $50,000000 could be
negotiated without sinking the price of five
twenty bonds below par, as the pubic
would not know how soon another $50,OO0,-
600, $500000,000 or $l,OOO,OOO,OOO might be
put upon the market.
AS to the position in reference to for
eign loan, 1t would, in my view, If carried
into effect be almost suicidal. If bonds
were sold abroad the price would be based,
, OF course, upon the present currency rate
of exchange; consequently the Govern
ment would receive about $50 in gold for
each $lOO in bonds, payable in gold, with
semi-annual interest, also payable In gold
in addition to exchange, commissions, &c.
t And in addition, if the Government should
., the price of gold-say 20 per cent.-it would
9 lessen to just that extent the net proceeds
: OF the bonds, and instead of $50 realize
only $40 for each 500 of bonds.
Yours truly, FREEMAN CLARK.
To this letter. Mr.. McCulloch, the Secre-
tary of the Treasury, replied, but it has not
. yet seen the light. Mr.. Clark rejoined as
B follows: -
nr,,,
t OFFICE OF THE CONTROLLER OF CURRENCY,S
y WAsHINGTON, March 10.
DEAR SIR:-Your letter of yesterday is
received. My letter of the oath ult., in an
swer to- yours of the same day, was so al
tered before it was published as not to in.
n dicate to whom it was addressed, and had
no other object, and think had no Other
= effect, than to simply express my objec-
tions to your Loan bill. l do not see any
Il impropriety in my giving publicity to my
dissent from your views of the public finan'
\ cial policy. In accepting the office J. hold
did not surrender my independence o.
Judgment nor my freedom of action.
have made no concealmenttro you or any
, one else, of my views in regard to the bill
from the time it was first proposed by you
After lapse of twelve days you notice my
letter to you cf the Ath of February, anc
. quote my statement therein that suppose
there must, at that time, including the de-
posits in National banks, be at least on(
hundred and fifty million dollars in thu
Treasury of the United States. 10 thi
you now reply that the actual amount o
money, on the 24th, in the Treasury ant
National repositories to the credit of thC
Government, exclusive of special gold de-
posits, was Sill, ,149,632.29. | cannot SCI
any reason for your maintaining distinc'
Uion between gold deposits and deposit!
made in currency. Both alike are stated In
your monthly report as liabilities and as
+ sets, and you have the right by law to usC
portion OF the gold, as you can safely us'
but portion of the currency deposits, be-
cause you must be prepared, by having
reserve on hand, to respond to the calls o.
depositors. In this view of the case there
is no reason why you should not add yOul
gold deposits to the Sill, l4J, ,632.29. The
( special gold deposit, as appears by YOU
/ statement of the first day of the month, Ii
/ Sl2 2627 900. This addedto to the amount tha
( YOU stated was in the Treasury, &C., on thC
24th of February, will make $123, ,722, 233 20
giving you the benefit, as l have, of golC
deposits, swelling the aggregate OF money
on hand, ~ ..t..-.
1 now unhesitatingly state that youl
! statement Just made to me, as well as your
4 published statements showing the condition
4 of the Treasury and the public debt on the
: first of this month, isinexcusably erroneous
You state the amount of coin in the Treas
ury to be $55,736 1872; currency, $66, 2S7,-
Il 767l l2: total, $1l60lS, ,959.A. Your monthly
statement, made on the first of the month
shows that you have retired $6,460,S50 o
compound interest and United States lega
= tenders; this amount must have been pait
before the date of my letter, and as there Il
=. i no law authorizing you to retire any of the
= compound interest notes, otherwise than by
~ converting them into five-twenty bonds
!. and no law authorizing the retirement o
7 anv United States legal tender notes in any
, other way than by converting them intt
! / compound interest notes, and no appropri'
!. alton or provision made by Congress othel
a. than that now mentioned, can not under.
stand why these compound interest anC
limited States notes should not be counted
and included as currency on hand. YOu
I have inst as much right to reissue them a.
Z. to pay out any other Government notes
I and no right or authority to cancel them
y 1t also appears by your last monthly state
7 ment that you have sold during the month
without authority of law, $l0,6727O0 o
:, five-twenty bonds and purchased $ll 1856,
y 600 of seven-thirty notes, making your pur
chase $2S3.3O0 more than your sale. Thi
{ sum should also be included as money OF
" hand. / will remark in passing, that whil
=. Won have the right to convert seven-thirt!
r. notes into five-twenty bonds as the forme
mature. YOU have no right whatever to buy
:. or sell them.
I I.4o.on,ant of the Ist of March. and vol