The evening telegraph. [volume] (Philadelphia [Pa.]) 1864-1918, 1867-10-11
REPUDlATIoN AGAIN.
he act of Congress kno-

y IA the issue of $500, 600, 600 of six per
-, boras. reaeemable after five years at the
,.Sn.sTro of the United States, and absolutely
nav.ble AFTER twenty years from their daVe.
Thcse are the bonds which are now WelL
A,rown all over the civilized world as United
p,atas Five-twenty bonds, which are sofa AZ
An The principal European exchanges, and are
almost exclusively owned by European oapi-
talists. The interest on them has heretofore
heen paid in gold, and everybody believes that
:, Ga dne in gold. Even Mr.. j. F. Butler
admits that it is due In gold Con-
cerning the interest no serious question has
ever been raised. But the five years after
which the United States may at their pleasure
nav off the capital of these bonds have expired,
and Mr.. Butler and his friends, in their deep
anxiety to diminish the taxation OF the people
and increase their own political reputation,
propose that the United States shall avail
themselves of this option and pay Off these
bonds. Now, the safest and simplest way Of
diminishing the interest charge upon debt
undoubtedly is to pay the debt itself, and we
belong TO that class of taxpayers who would
be very glad to see this or any other portion
of the debt paid off as soon as possible, and
taxation correspondingly reduced. The ques-
as to the money in which it shall be paid. Mr..
Butler saws that it should be paid off in legal
tender notes, claiming that the law allows this
mode of payment and that the public welfare
requires it.
Does the law allow it The very fact that
the question can be asked and seriously dis
cussed proves that the law is not clear. In
fact. the letter of the law leaves an opening
Dir doubt. The spirit of the law removes all
doubt. The letter of the law makes it pos
sible for reckless demagogues, and for
thoughtless people oppressed by burden
wilfully and knowingly assumed, to claim
the right to redeem the bonds in currency.
The spirit of the law imposes far different
obligation.
In July, 1861, a law was passed authorizing
the issue of $50, 600, 900 of paper money and
$50,00O,0 600 of bonds bearing per cent. inte-
rest, redeemable at the pleasure of the United
States after twenty years from their date. At
the time this law was passed there was no
question as to the currency of the United
States. 1t was gOld-coin currency and both
the $50,000,OOO of paper money and the
$50 900, 600 of bonds were and are payable in
coin without any stipulation to that effect, for
the simple reason that at that time no other
mode of payment had yet been discussed or
thought of. The paper money issued under
this act became known as demand notes, and
has been gradually redeemed in coin or its
"sixes of 1881" The interest on them has so
far been paid in coin, and it seems difficult to
imagine the slightest ground upon which
either interest or capital can be paid in any
thing else. Nor, as far as we are aware, has
any one asserted that it can be paid in any
thing but coin.
In February, 1862, the law was passed autho-
rizing the issue of the Five-twenty bonds.
Nothing was said in the act of the currency in
which the principal should be paid, nothing
was said of the currencyin which the interest
should be paid. But it was provided that the
receipts from customs should be specifically
pledged to the payment of the interest, and it
was specifically enacted that all customs should
be paid in coiu. The bonds were per cent.
bonds, precisely like those issued six months
before. There was no distinction in the acts
providing that capital or interest of either
should be paid in coin. Only in the act
authorizing the issue of the Five-twenties, to
make the interest payment all the more sure,
specific revenues were in another part Of
the act pledged to the payment of that
interest. And now, because additional
security was given for the payment of the
interest in coin, it is urged that it could not
have been intended to pay the principal in
coin, or else the additional security would
have been given for the principal likewise.
The fact is that the same security actually was
given. The same paragraph of the act which
in coin of the interest on these bonds provides
that part of the coin so received shall be set
aside as a sinking fund for the payment of the
1,rincipal of the debt. Yet in the face of this
the letter of the law is appealed to, showing
that in the paragraph authorizing the bonds
nothing was said of the currency in which
principal or interest should be payable.
It is true that the same act under which
these bonds were issued also authorized the
making of $150,000,000 of greenbacB
paper money thenceforth the legal-tendei
currency of the United States, and herein lies
the strong point of the repudiator's argument
II is first proved that the law does not declare
in what currency the bond shall be paid; it is
then shown that the bond was sold for legal.
tender currency; and it is next alleged that
as the law does not specify in what currency
the bond shall be paid, equity demands that
it shall be paid in the same currency that the
United States received for it. The argument
is plausible; but it is, after all, but special
pleading.
Granted that the law does not specify the
currency in which the bond is payable; granted
that the strong inference drawn above in favor
OF the bond being payable in coin is unwar,
ranted; granted that the bond is payable in
the same curr ncy that the United States re-
oeiVed for it-granted all this, and we must
stl! deny that the bond is payable in legal
tender currency
issued under the act of 1862 is no longer the
legal-tender of to-day. The old legal-tender
which was paid back into the United States
Treasury for these Nve-twenty bonds had at
tached to it the privilege that it could be ex
changed at par, at the option of the holder.
for the very bonds in question. The present
legaltender notes have no such privilege. and