The evening telegraph. [volume] (Philadelphia [Pa.]) 1864-1918, 1868-07-07
The minstlce of TaAing BOnls.

The Injustice Of Taxing Bonds.
From Ue Chicago Tribune.
The Committee of Ways and Means, in re-
porting back to the House the Buter-CObb
resolution reducing the interest upon United
States bonds, in the form of a BILL say that
they do so Gin obedience to an order from the
House, and in opposition to their best judg-
ment," and that they "reserve to themselves
the right as members of the House. to oppose
i'll every possible way the adoption of the
measure, which they regard as hostile to the
public interest and injurious to the national
character" The committee could not have
expressed their disapprobation of the bill
they were forced to report in stronger
language. Bat they have also framed
1t in such terms as to indicate to
him that runs precisely the meaning
of q ten per cent. tax upon coupons. "rO
secure the collection OF said tax" says the
bill, ''the amount of interest hereafter paid
On any bonds or securities OF the Uuited
States, bearing interest at six per centum
shall br a. the Taje OF only five and half per
centum; bearing interest at the rate of five
per cen,um shall be at the rate of only four
and half per Centum; and airing interest
at the rate of three per centum shall be at
the rate OF only two and seven tenths per
centum per annum;" and prov sion is added
that mo higher rate of interest shall be paid
on the national securities, all conditions of
such securities and all laws to the contrary not
withstanding." The bill reported thus de-
clares that the bondholders shall hereafter
receive, in lieu of the interest specified on the
face OF the national promise to pay, ga com
position at the rate" of ninety cents on the
dOllar-to borrow the expression with which
an English journal characterizss the tax OF
sixteen per cent. recently imposed upon her
by the bankrupt Government of Austria.
To the foreign bOndhOder, who purchased
his bonds in the belief that the nation by
which they We're issued would observe at least
the letter of the obligation, the proposed mea-
sure would be- simply a breach OF good faith,
the consequences of which would be di5as-
trOus TO all concerned. The markets of Lon
don, Frankfort and New York cannot b9 far
apart while the Atlantic cable continues in use,
and depression on one side of the water must
be followed by corresponding depression on
the other SIDE. The European stock exchanges
are more sensitive than the American to in
tiuences affecting the marketable value of
United States bonds, have much less faith in
the purpose of the Government to pay them
according to their letter and spirit, and will
throw them upon our hands if alarmed. 1t
needs no prophet to tell business man the
effect upon values of the forced sales of one or
| two hundred millions of the six or eight hun
dred millions Of bonds held abroad. Breach
of faith with the foreign bOndhofder will surely
| lead to depreciation in the value of the
| principal at least equivalent to the amount
netted by the tax, probably to serious dis
arrangement in business and perhaps to
! commercial crisis.
In the case of the American bondholder,
| the proposed abatement of interest, Instead of
! equalizing taxation, as claimed, would create
a marked inequality. AS was shown by Mr..
| Blaine, in the speech We published the other
! day, more than seven hundred aud fifty mil
! lions of the bonds being held by national
] hanks
panies, are already heavily taxed. Moreover,
the act of March 2 1867, expressly provides
that in estimating 1.-The gains, profits and in
come of any person, there shall be included
all income derived from interest upon notes,
bonds or other securities Of the United States"
and 1.-The amount of all premium on gold and
coupons" Thus every person residing in the
United States and every citizen of the United
States wherever residing must pay at least
! five per cent upon every coupon he collects.
| Why should he be made TO pay fifteen per
cent
The theory, even if it We're founded in fact,
! that the national securities held at home are
mainly in the hands of wealthy capitalists
, would afford no ground for an enactment so
| unjust in its operations for wealthy capitalists,
! who lend their money to the Government,
ought not to be punished for doing so by being
taxed more heavily than capitalists who invest
their fortunes elsewhere. Bat it is not the
ldCL ludJ lnb Onllbu OldlbS DOuuS are so l6lu.
A large proportion of them are held by poor
people, or by people in moderate ciroum-
stances, either directly or indirectly through
their interest in savings banks, insurance
/ companies, or national basks. 1t is these
people, who cannot change their Investments
so readily rs moueyed men, whom the Butler
Cobb proposition will rob. The Western man
invests less in permanent securities, because
he turns over his money otener than the
more cautious citizens o. older communities,
but in the East it is otherwise. Hence the OPP
position from the East to Pendeton's scheme
of reputation, which Messrs. Butler and Cobb
have done no little to bolster up if reports
from New York may be relied upon.
Grant and ReyOcatiOn-A Parallel.
| From the ". T. World
Nearly seven hundred years ago, soon after
the accession of Richard | to the throne of
England, a number of Jews thronged from all
parts of the kingdom to London chiefly for
the purpose of seeing the coronation of that
Prince. Intolerance-a sin from which the
world yet suilers-was very rife among our
half-barbarOus ancestors then, aud the Jews
were forbidden to present themselves on the
occasion. A few of them had the temerty TO
do SO in disguise, however, but they were
discovered, and the infuriate pOpulace at once