Litchfield enquirer., 1868-01-02
The Finances,

congress IS turning It's attention this session chiefly to the question of finance. The cry for the payment of our bonds in currency and the strong and just popular feeling against their exemption from state and local taxation, make it necessary that some remedy shall be applied forthwith. The agitation for payment of the princi- pal of the Five Twenties in currency is not so groundless as we would like to think. Taking the Laws as they stand, without reference to the construction that has always been put on them by the gov ernment and it's agents, it is doubtful whether payment of the principal in coin could be claimed. Inasmuch, however. as the agents and officers of government have put the latter construction on them, and inasmuch as those bonds brought a fan higher price. especially abroad, than they could have done had it been supposed tha, at the end of five years they might be paid off in a depreciating currency, we think our government is at the present time ss- 1. topped from claiming different construc. tion. That the bonds should be paid in coin, and that so large proportion of the capital of our country should no longer be exempt from State taxation, is beyond doubt the opinion of large majority of the XLth Congress-. Regarding the legis. lation best tadapted to settle these questions, differences will probably arise. At present the most prominent plan is that of Sena. tor Sherman in the bill lately reported from the Senate Finance Committee. I, is in substance as follows:
 list. A new issue of six per cent Ten Forty bonds. principal and interest paya- ble in coin. the government reserving, however. oneper cent for taxes. Of the one per cent so reserved one half is to be distributed among the States in propor- ton to their population, and the remain ing half to be paid into Sinking Fund for the reduction of the National debt.
 2d. Five Twenties and Legal Tenders may be converted into these bonds: while. until the resumption of specie payments, the proposed bonds may be converted into Legal Tenders, provided the latter are moi thus swelled beyond the legal amount.
 The Committee urge that the reserya- tion of 1-2 per cent will yield the States more than they would probably obtain from direct local taxation owing to the ex. treme difficulty of detecting the ownership of Coupon Bonds. They say that if by this arrangement States where few of these bonds are owned are paid as much. as those where the bonds are largely owned, those States are poor and greatly need as. sistance. They say, further, that if ou, national securities were subject to the local taxation of our large cities, as high in some cases as per cent. they would be driven out of their very best markets.
 {. To this,as to any plan, there are many ob. vious objections? One half of ono pc, cent is by no means equal to the average of local taxation. If the evil is to be fully and fairly remedied in the way proposed hewhole interest reserved should be paid over to the several States. Although the poorer States may need pacnniary assis tance. yet If they are not legally entitled oit, would there not be plain perversiop of the money of tax payers to uses merel, charitable, and therefore unwarranted. mn. der our system of government? The chic, advantage of the proposed method is tha, the taxes reserved are fully and surely paid with no cost of collection-s great point certainly.