Fayette County herald. [volume] (Washington [Washington Court House], Fayette County, O. [Ohio]) 1860-1???, 1867-09-05
FINANCES AND TAXATION,
Speech of Senator John Sherman
to a Republican Mass Meeting
at Canton, Ohio, Tuesday, Aug.
20, 1867.

aO3 loOis
The following on finances and taxes II
taken from the speech by Senator Sher
man, at Canton, on Tuesday, August 20
FINANCIAL QUESTION,
There are some questions not specially
involved in the CANVASS, but which are
very important. | can only allude to some
of them very briefly, and chiefly in reply
to what Judge Ranney said toyou the 9th
er day. They are financial questions grow
ing out of the war, You will observe that
these doctors do not agree at all. Judge
Thurman, Judge Ranney and Mr.. Vallan-
digham, and no doubt many Others, talk
about debt and taxes and banks, merely
to excite opposition, but the Democratic
party have not, and dare not take definite
positions in any of them. Until the last
"ngger" is exhausted, they will not meet
fairly these great questions. Judge Ran
ney is opposed to an increase of paper
money while Thurman wants to pay of
our bonds in mere greenbacks, or mere
rags as he calls them, and Vallr ndigham
is in favor OF paying the whole debt in an
issue Of greenbaeks, The question with
you will be whether the Union party,
which is entitled to the credit Of the won
derful success of our financial measures,
can best solve all new problems as they
rise, or whether the public credit can be
safely committed to party that, during
the war, did all they could to destroy our
credit. Lee us look al some of these mat.
ters. They talk nf our large public debt.
Very well, our debt is large, but who caus-
ed itP A Democratic rebellion. We had
to choose between great war with its in
evitable incidents, debt and taxation, or,
on the other hand, the overthrow of the
National Government. The Union party
preferred war, debt and taxes, to disuniOn.
Did the Union party unnecessarily in
erease the debt, or impose unequal or un.
just taxes2 On the contrary, our financial
measures were as successful as our mill
tary measures, while all the efforts of the
Democratic party impaired our credit,
made it difficult to negotiate loans, pro-
longed the war and increased the debt
Ask, now the war is over, what party is
likely to increase the debt We have the
fact before us that the Union party has
not only prevented the increase of the
debt, but its reduction has been steady and
rapid. On the 3lst day of August, 1865,
it was list ,8O3,586. On the first of
November, 1866, it was $2O6,379 ,595' On
the first day of August, 1867, it was 49,
5ll ,3O6, ,436, or total reduction of $685.
497 $50 in less than two years. And dur
ing these two years we paid off besides an
immense amount of floating debt, the de-
brls of the war. Suppose the Democratic
party now in power, who does not know
that the debt would be largely increased.
The old Demo ratio States, Kentucky,
Maryland and Delaware, are now demand
ing untold millions to pay for theirslaves.
Every Democrat is committed to their
payment. All over the South they are
pressing claims for injuries during the
war. A Democratic Congress would grant
them all. Nearly every Democratic Sena-
tor and member has committed himself to
principles, which, if once adopted, will
add to your debt FIVE hundred to one thou
sand millions of dollars For this reason
they constantly exaggerate the amount of
the public debt. Let us see what tits. 1t
is audited, and we know to dollar the
amount. l read from the last official
statement of the Secretary of the Treas
ury. The aggregate debt less cash in
hand, August |, was 1881 | ,%O6,4"9, but
of this 1897 1906, 1876 is in greenbacks and
fractional currency not paying interest,
leaving the interest bearing debt ST. A.
O00,0 900. Now. if | have my way, this
debt will not be increased one dollar on
any preteXt whatever, but will be surely
and gradually paid off
1t is said that this debt is not subject to
taxes, and that this discrimination is un'
Just to other taxpayers Now this debt
as property orincome held by our citizens
is subjected to taxes by the United States.
Congress may impose taxes on it, as it
does on other property or income. These
bonds now pay income tax, but it is not
subject to State tax. This is true, but
whose fault is it2 Did the Union party
make this exemption Not at all 1t is
made by the Constitution of the United
States, for which our Democratic friends,
when its suits their purpose, profess such
profound Difference. The Supreme Court
of the United States, as early as 1919 de-
cided that bonds OF the United States are
not subject to tax under State authority.
This decision has been followed in null
titude of cases since. 1t so happens that
every Judge that has sat on the Supreme
bench from 1919 to this time has had this
question before him, aud each one concurs
in the same opinion. The principle is OBJ.
vious, that the p, wer of Congress to bOr-
row money is paramountand cannot he tax
ed orinterfered with without destroying it.
TO allow n State to tax national loans may
enable State to prevent the nation from
borrowing money. Now, these decisions
are very well known to as good lawyers MS
Thurman and Ranney, but, instead of
stating them fairly, they blame the Union
party for exempting the bonds, while all
United States bonds have been exempt
from local taxes sincethe foundation of the
Government, by the Constitution ITSELF
and this has teen acquiesced IN by every
administration, including the Democra ic.
The first loan during the war contained
no reference to this Constitutional exemp-
ton, but in subsequent days, after recent
decision by Judge Tanney, in December,
1869, thnt United States bonds could not
be taxed, we inserted n declaration in one
of our loan laws. that United States bonds
were not taxable by or under State author
itv. This did not change the law, but
simplv declared the law. In view of this
very question, and Of the certainty that
when The war was over our restored credit
would enable us to borrow money on more
favorable terms, we always kept in view
in issuing bonds the principles of redeem
ability, at the pleasure of the United
states, on short time This was a fixed
policy of your financial agents. This is
the reason of your fve-twenties and ten
forties. The United States may pay off
any portion of our debt within a short
time, either by taxes or by borrowing
money on more favorable terms. Nothing
now stands in the way of the treasury
notes known as seven-thirties, which will
soon be converted. When this is accom-
plished the whole public debt is in the
most favorable shape, and may from time
to time be funded at lower rate of inter
est, and so as to adjust on conditions pro-
per and right, both to tax payers and pub
r r.