The evening telegraph. [volume] (Philadelphia [Pa.]) 1864-1918, 1866-05-05
SATURDAY, MAY s, 1866.
The Proposed Consolidated Debt Loan
Its Effects upon the Country.

u
consolidated debt loan, at five per cent. inte-
rest, and to run for thirty years, meets with
almost universal approval. Indeed, the ques-
tion is one upon which there can hardly be
two opinions. The measure is in no sense
political one, and so can excite no partisan
prejudices, while it appeals to those Obvious
financial considerations which have weight
with every intelligent citizen. Republicans
and Democrats, radicals and conservatives,
can all see that it is better for us to pay five
per cent. interest on the public debt than six
or seven and three-tenths per cent. All can
see that a saving of twenty millions OF dollars
every year in mere interest is good financial
operation for the nation to make. 1t is
equivalent, so far as the payment of interest
is concerned, to the wiping out of principal
of two hundred and seventy-flve millions Of
dollars bearing seven and three-tenths per
cent. interest, or three hundred and thirty
three millions bearing six per cent. But
every dollar of interest saved is a dollar
taken off of our taxes Twenty millions
of interest saved is, therefore. twenty millions
of taxes saved. This everybody can appre-
ciate; and herein is one Of the chief ele-
ments of popularity in the proposed Consoli-
dated debt-tbat it will assist in tightening
the load of taxation which now presses so
heavily upon the nation. Every man who
subscribes to the loan subscribes towards
reducing his own taxes. The reduction Of
taxes means the cheapening of food, cloth
ing, house-rents, and all that goes to make up
a living. Moreover the reduction of interest
upon the national debt will tend to reduce
the rates of interest upon money generally.
There can be no doubt that the seven and
three -tenths rate of interest paid by the
Government on so large portion of its debt
has had the effect Of raising the interest on
money used in commercial transactions.
Capitalists who can get seven and three
tenths per cent. interest for their money
from the Government are not willing to take
less from their neighbors. We saw the effect
OF this during the recent session of our
Legislature, in the attempt to legalize an
increased rate of interest in this Common
wealth. The reduction OF the rate of interest
paid by the Government will tend to make
money cheaper everywhere, and thus to
stimulate production and increase business.
The consolidation of the national debt will
be one step, and a long one, towards the re-
sumption of specie payments. Everybody
knows that we must get back to that at some
time or other. We do not expect to do 1t by
single leap, but a commencement in that d.
rection must be made. There need be no
fear that the able and cautious Secretary of
the Treasury will precipitate resumption.
The United States notes, or ''greenbacks," are
not to be retired under this act, while the
very process OF funding the interest-bearing
debt into the proposed loan will necessitate
an easy money market. 1t will also necessa-
rily extend over a considerable length O
time, and its effects will therefore be gra
dually felt. The final result, however, of
consolidating the debt will be the resumption
Of specie payments. We shall thus get back
to a sound financial basis, with our debt
funded at low rate of interest, and without
any crash or revulsion to cripple the industry
and commerce of the country.
But the crowning excellence in national
point of view of the measure under discus
sion, is that feature of it which provides for
sinking fund Tor the final payment OF the pub
lie debt. We do not regard national debt
as per Sc desirable thing. 1t doubtless
coniers some incidental advantages, but it is
very far from being an unmixed good. At
least it does not comport with American ideas
that the national debt shall be made perma-
nent institution Of the country. The English
people may tolerate such thing, but we can
not. The debt must be paid. Secretary
MoCULLoCHs plan provides for sinking
fund of thiIty millions per annum to be ap-
propriated to this object. This sum is to take
the place of the sinking fund provided for By
the act oil February, 1862, and will be mainly
made up of the interest saved by the reduc-
ton OF interest in the proposed consolidation
of the public debt. In thirty-hve years this
sinking fund will pay of the entire debt.
Should this grand scheme be successfully
carried out, what a splendid financial record
will our nation have made tor herselfl Called
suddenly to confront war of Vastor propor-
tions than any other Of modern times she
prosecutes it to a triumphant ISSUE and meets
every dollar of the enormous expense out of
the freely opened pockets of her own citizens.
With the first notes Of peace she consoldates
her various obligations into one great popu-
lar loan, and then goes to work and in the
lifetime of single generation paws Off the
entire debit What nation of ancient or
modern times can equal thisP
The illustrious triumphs of our armies in