New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1867-11-26
THE FINANCES.
IMPORTANT STATEMENT or THE VIEWS OF CHEZ
JUSTICE CHASE.

WASHINGTON Nov. IL, 1867.
7, the rresent uncertain condition of the fnan-
ol and business interests of the country is mpor-
tant to bring tc light the judgments and opinions OF
those whose past experience, official positions ana re-
cocnzed ability in financial matters, give weight to
their views on the leading questions Of the hour,
viz; those relating to the public debt taxation, and
currency Feeling that the country would regard
with special interest the views of Chief Justice
Chase on these questions. your correspondent has
taken occasion to consult him one or two points
of course leaving many portions of the general sub
iect untouched. which, if elucidated with equai
clearness would doubtless prove OF great interest III
the present iuncture. the work of Secretary ChaSe'
Though it is generally conceded among ihlehlgenO
men 10 have been conducted with an ability exceed
ing that which characterized any other phase Oh our
war history has not been generally undeIStoou' ~
may be stated under three heads:
l. To establish satisfactory relations between the
public credit and the productive industry OF the
country-in other words, TO obtain supplies. Inc
suspepsion of the banks put end to the first and
most obyions resort, loans Of gold and made new
,,+I,ods INDISPENSABLE Then the Secretary resOrted
10 legal Tender notes. made them currency, ana
borrowed them as cash. The patriotism OF the peo-
nile came in All Of The abors Of the Treasury ana the
LEGISLATION of Congress- and the first great object was
made secure
H. To provide against disastrous results on re-
turn of peace This cOuld only be done by providing
aNational Currency. There were about 100 state
Ranks in existence which wanted to make their own
paper the currency Of the country Tins the Secic-
tarv resisted and confined his loans to Greenbacks;
but he did not drive out their currency, nor indeed
did he think it exactly honest to so deprive them OF
II without giving any equivalent. To neutralize
+be,r o,.ryDSitIOn to a National currency and MAKE
them allies as far as possible instead of enemies In
his endeavos to secure such results he proposed the
National Banking system, and before he lett the De
partment its success was assured
The National Blnks were certain to be useful in
many WAYS but he Secretary's main object was the
establishment of a National Currency. This MI
Chase remarked. saved us from panic and reyulsion
-t the end of the war; and is of inestimable value to
men of labor and men of business-indeed TO every
class.
Ill The third division of his labor was to provide
afnding system 1t was unavoidable during the
Rebellion that every means of credit should be used
He borrowed money every way he could at reason
able rates The form that suited one lender did not
suit another: and the army and navy needed every
dollar that could I've raised in any form. Hence tenn
porary loans certificates of deposit certificates OF in
debtedness, $50 notes, compound interest notes,
Treasury notes payable after one and two years &c
But it was necessary to have funding loans, into
which all these temporary loans could be ultimately
merged To this end the Secretary established the
$50 loan and the 10-40 loan his belief was that
after the $l4OO0O0 of the go loan had been TAKEN
Che additional amounts needed could be obtained by
the 1910 loan and the temporary loans bat the Sec
rotary was ready to resort TO the 52Os in case Of
emergency He did &c. $4,000 600 in the 1910 loan,
and his successors got about s2OO 100000 more at par
And Mr.. Chase has never been able to any good
reason for making the 80 notes subsequently issued
convertible at the holders option into 520s instead
of 1O4Os Lenders of course, preferred the former,
bearing per cent m gold the latter bearing only
per cent? and lenders were rather more favored
after he left the Department than beforehand so,
indeed were brokers' for Mr. Jay Cooke got nearly
or quite twice as large commissions under Fessenden
and bIcCuoch as Secretary Chase allowed him.
1t is easy to see how Nr. Chase's funding system
worked, by examining the last statement of the
public debt. The condition is something like this:
81 2O0OOOOOO 5-o0s; $.0lOOOOOO 10-40s; $2000O00O0
sis payable now after "A years, which can then
easily be put into 1OlOs; other loans la temporary
say $jOOOOOO,O, of which threefourths consist Of
7.3Os convertible, and certain to be converted
into 1OsCs; and sag $C0O00OoO greenbacks including
fractional currency making the debt Of $250O0O0QO0
So it may be seen. the whole debt except Sis Is
already funded OF sure to be funded in go SIX per
cents or 1910 five per cents
Can there be a better funding system? Mr. Chase
says there cannot. Yet there is talk Of new fund
ing loan!
The object is to catch cudgeops by apparently
yielding to the popular camor for taxation on bonds
The scheme is TO offer a per cent loan, with
reservation of a right to tax not exceeding per
cent in other words, a new HOH-taXable per cent
loan: and it is proposed to make this long loan
say 80 years ." Il will be magnificent" Mr. Chase
remarks, for brokers, bankers, and lenders, but
death on the people" Of course such a loan can DO
negotiated; for a per cent 9Oyear loan, untaxable
is worth more in the market because it will collect
more out OF the taxpayer for the bOndhoder than any
loan nor oHtstqRdpg and nothing is more certain III
the future than that Government ,oiH be pairing tch
az FIRE gears s. 10 and Is per cent for tie picge
Of payiag is deJl before maturity.
The Secretary comedies it may be well enough to
make the loan in the form proposed, if the clamor for
taxation viii he satisfied by it, but why make it for
- years OF 50 years instead of adherng to the 1910
plan, by which the debt is Tedeemable at any time
after 20 years and thus kept under the control of the
peopls9 The Secretary has no doubt that if our IL
nances are properly managed, we can borrow within
zen years at per cen-Or with right to tax at one
NTH as we can now borrow at or 6, with right to
FAX at one-sixth. Why bind ourselves to pay either
rate of interest for 20 years when it is not only
necessary, but certain TO entail heavy additional
expense in the form Of premiums for redemptionl
When Secretary Chase negotiated at par the $73-
O00C00 Of 1910 five per cents the currency much
less inflated than it has been since, and is
the issues Of the grcenbacks, and the indispositOn
of Congress to tax the State Bank currency out Of
circulation, caused almost all the initiation that took
place under Mr. Cbases administration. The late
initiation does not seem to him required by public
igcncies The gTeenbacks, he declares should have
been retired nearly quite pGT passa with the is
sues of National Bank notes, and the equilibrium