The Richmond palladium. [volume] (Richmond, Ind.) 1855-1875, 1867-10-31

The Financial Situation.

4 - =
The Financial Situation.
rs Yxlcs or COLD. Tnx cAUs.s OF iTs INCREASED
10 de Editor Of tie Dsaoa Poa.-When ths Sscss-
tary Of the Treasurer made his memorable Fon
Wayne speech, promising an early resumptsoa q
specie payment in the United States, superficial think
crs were led to believe that the Secretary had sons
financial scheme in view that would result in An sAry
accomplishment of his promised hopes. II was ex-
pected that's rapid reduction Of the currency Of the
country would be adopted, and by that means aaons
| specie payment wosA be Of easy acconpiishnsnt.
few trials Of contraction soon satisfied ths ess-
retary and his advisers that any great reduction OF
currency would result in revulsion and inability on
tie part of the people to meet the heavy taxation ns
cssary for shs payment Of the interest the nation
al debt and It was also feared that such Tsvulson
as might follow rapid contraction would reduce the
ability Of the people to purchase foreign commodities
such An extent ~ lessen the revenue from i'm
ports largely for the safety of The national neees
sities Thus perplexed and heatating, the Secretary
has yet 6xed policy that il likely to reach the
goal of specie payment but has allowed the
finances Of the country~to drift along gradually but
steadily toward financial embarrassmsnts that in the
end will require the ablest and frmest measures to
| save tho country from deep humiliation.
Numerous reasons are assigned BY different writer's
for the failure Of the Government to reduce the pre-
MUM coin and for its gradual but steady pressure
upward, but yet fail to single article that
embraces all the leading elements that bear promn-
entity upon the subject.
In the report of the Treasury foreign and
| domestic commerce of 1868, and published in 1854,
page A. it is stated that the estimated amount of cap
ital held foreigners in the United States. including
State national, railroad and municipal stocks and
bonds 5amounted at that time to $500 900. From
1863 to 1867 there has been added large amount Of
State railroad and municipal securities to those held
by foreigners in 1s63 The New England States alon
increased their State debts during the $4o-
eeo00o while all The other fcs States aded largely
70 their liabilities, large amounts of which have gone
| abroad, and some of our most expensive railroads
have placed vely large amounts of their stocks and
bonds in Europe during the past four years. Add to
all the above about 81 900 of our national war
abroad to pay for trade balances and have
the enormous aggregate Of 81 of interest
bearing debt now held by foreigners.
Estimating the average rate of interest at six per
cent, and have the handsome Of $50, 600
to pay Europe annually that does not appear in
customhouse returns, but must be sent in con bonds
or agricultural products.
Our import and export account for 1866 Treasury
report of 1859 is follows: III
Aggregate imports, 100000
Less specie imported, about. 9,000, 900
ux, s42s, ,soo. 900
valuations and smuggling ........ s5,72o.o 900
Actual value OF imports, not including
Our exports, exclusive Of spscie. during
the same year. were about zs0, SOC, 900
Deduct 40 per cent. for currency valua-
tions of exports, coin value . ls1, ,7ce,ooe
Add .,..,. and ,,on sass g :ss sss
Coin value of expoTts.... es......s. $3.50 500 900
Deduct coin value of exports from coin value of
imports, and have . balance of $143 $50, 900 Of
coin values to pay for in the excess of foreign
purchases over our whole exports. Add to this sum
$50 100000 OF annual interest, and have aggre-
gate OF 100000 of annual balance pay Eu-
rope This balance is paid by selling national and
other securities at about u dollar, and it
will take about $324 900 Of securities to pay this
annual difference between the trade and interest bal
ancss constantly accruing against Us. - VI
It is uncommon event for from IS 600 900 to s7,-
of national bonds to be shipped 10 Europe
in single week. This process may possibly last two
years longer, but the scarcity of bonds for export
will begin to be severely felt by the time 5000 100000
more Of them CLEANED from the country to supply
the demands of our foreign customers. asG
Whenever bonds for export begin be scarce, more
specie will b demanded, and higher prices for coin
will be the result and the people of this country need
not be surprised If coin should rule ~ high - $50 be-
fore the LIST of January. .s7c.
Free Traders, importers, and inconsiderate legsla-
tors win undoubtedly undertake to evade the discus
sion Of the true leading hu ancial embarrass
tanda DnAio nf he
payments but there 10 nothing certain than the
fact of large overtrading with foreign Countries aud
Of large shipments Of national and other American
securities to pay balsnces and it is equally that
. continuance Of this process must lead to serious
results. aslsg sa55tss - Eaags5.f ssek 4
There is but one mode Of avertng the prospective
evil. That is by reducing imports to . point
where our exports Of American products will pay for
our mportations Of merchandise and our interest on
securities held abroad, reserving at least part of
specie to accumulate in this country with . view to
ultimate resumption.
There are two modes BY which importations may
be reduced. One - BY Withdrawing so large pro-
portion of the currency in to render the !
people unable to buy commodities of any kind. The
other is by increasing the duties importations to
such An extent As to make it Improbable to import
SO large An amount we do The first course
will be certain to cripple the Government incomes to
dangerous extent. The latter course viii promote
American manufactures and keep the wheels of our
internal commerce active, thereby enabling the poo
pie to pay with the heavy taxation necessary for
the support Of the National Treasury.
Congress and the people may as we'll begin to look
the facts in the face, and if ne have statesmen in
Congress who desire to forestall impending hnan-
cia caamty they cannot fail to tho necessity for
carly and firm action. Long delay wiz find our pros
ent system has drfted into condition from which no
statesanship can extricate the country, without re
vulsion and temporary bankruptcy.
The whole country il now waiting and expecting
in the indefinite future . financial collapse There
need be a EAR srata oveut tai; ,,J~~.-