The weekly North-Carolina standard. [volume] (Raleigh, N.C.) 186?-1869, 1868-08-12
SPEECH OF
GENERAL L. Ct. ESTES.
OF NEW HANOVER
ON THE FINANCE BILL.

orally called the Funding Act, principal and
interest of the public debt due during the
year 1866, and prior to that year have been
funded into new six per cent bonds. 1t has
been strangely asserted that this act has
failed as a measure of finance.
This assertion is founded on total ignorance
| of the object of the General Assembly in
| passing such law.
The measure was plainly intended as q
part of general scheme, n preliminary to
the payment of interest on both tile oM and
ae,o bonds in money
The State owed for securities which had
become due, principal and interest, over
| three millions of dollars. This debt was
DIR, was present, subslsting, and ever press
ing burden on the treasury. 1t had to be
provided fer 1t could not ofcourse be paid
IN money raised by taxation. 1t would
have been disastrous operation to have
! paid il by sale of State bonds at the market
price 90 cents in the dolar) The General
| Assembly, intending in good faith to re-
sumo the regular payment of interest on the
| whole debt, offered to give new bonds at par
| for the past due interest. The public crcdi-
tor accepted the proposition. In doing so
he gave up paper on which the State owed
| him dollar for dollar and received the paper
worth only fifty cents.
The history of the times shows what was
intended by both parties in this operation.
| Gov. Worth was treasurer when the act was
! submitted to the Assembly. 1t is well
/ kno Sn that he drew it and urged its pas
sage He was always, to his honor he it
said, the firm enemy of population in all
| its forms. Gov. Worth intended this act as
Il stepping stone to the redemption of pay
ment of interest Knowing his views on
| this point, the Conservatives elected him to
| the office of Governor, and certainly no man
can show an? utterance, since his Inaugural
| ton showing any change of views.
Similar statements may be made rs to
| the position of Mr. Treasurer Battle on this
| question. 1t Is evident from the various re-
| pcrts made by him to the Assembly,, that
| he favored this funding act of March 10th,
1866, with express purpose of resumng the
| payment OF interest 1t is known that he
favored the proposal of Mr.. Cowan of New
| Hanover. to lay q tax for the purpose, which
| failed only by few votes in the House of
| Commons, receiving the votes of many of
| the leading conservatives of the State.
1t is objected to this funding that thereby
| tuC OGdtC DtCOllCS lifi)iC lOC CDInDounu III
terest," while citizens are only bound to pay
simple interest" This is an entire mistake
The debt Of the State is evidenced almost
entirely by coupon bonds, i. e. bonds having
coupons for interest attached. Now it is
a settled principle of law that these coupons
are separate securities, and whenever due,
become independent obligations.
1t an individual executes u bond, and
also gives a separate note for the interest,
| whenever said interest note becomes due
| from maturity it must be paid When there
fore the State, by the Funding Act. issued
| bonds with int crest from 1st of January,
| 1866, in redemption of coupons due 1st July,
| 1861, and at successive periods thereafter,
| allowing no interest Oh such coupons, she
| did much less than an individual, liable on
! similar securities, who could be forced by
| law to pay.
The State allowed on a $1,000, bond
eleven coupons, $3.50, while an individual
would be bound to pay the $3.50. and also
interest on the same, amounting to 1919 so.
1t is unreasonable to- complain of the Fluid
ing Act as reprehensible extravaganza of
liberality.
The passage of the act however, although
| not followed as its advocates wished, by re-
| sumption of payment of interest in money,
was of signal service in demonstrating that
the existing State government recognized
the validity of her debts not incurred for
war purposes. The public credit, though
not restored, was improved, and our citizens
were enabled by means of the confidence in
| spired by the passage of the law, to realize
| much larger sums from the sale of their Sc
curities tristes reliquiae of departed fortunes.
than would otherwise have been possible.
| Its defeat would have rendered them prac-
tically unsaleable.
We plant ourselves on the platform of open
hostility to all appearances of reputation,
State or national. BY non. payment of our
interest since 1866, the debt has grown. I'm
less we begin to keep down that interest, its
accumulated burdens will break down our
people. We must resume, and resume at
once Delay adds to the difficulty. In my
view, every consideration of honor and sell
interest demands this course
The delay since 1866 has added two mil
lions of dollars more of interest, now de
manding payment at the Treasury. Like
honest men who, being unable to meet theil
obligations, will give their notes, for the
sums due. so we must issue our bonds tt
meet this interest With unexampled libe
rality the public creditor is willing to accept
our bonds at par, provided they think We
bona file intend hereafter to meet our obi
cations.
The character of the State reacts upon tho
character of the citizen. Loss of self-respect
laXity of moral principle, faitlllessness and
fraud, certainly follow breach of obligations
by the government Material losses can by
industry and thrift be speedily repaired
But injuries to the moral constitution Of
people, it is almost impossible to heal LIE
the General Assembly prove that not all thu
caIamities of war continued since its clos
by extraordinary floods and parchins
droughts, can break our resolution to adhert
to plighte,l faith, and individuals will b,
nerved to initiate their great exemplar
They will I've melted to renewed exertons tt
repair their broken fortunes, and signal in
crease of the general wealth will speedil,
follow.
Leaving the moral aspect of the question
it is certain that failure to meet our obliga
tions, will seriously injure our interests.
1st. North Carolina has abundant rcsour
ces undeveloped, untold wealth is hidden il
our forests and beneath our soil, while un
limitless power rolls down our rivers unap
propriated and wasted. To explore and de
velope these resources and obtain this powe
are needed capital and labor. The bette
class Of immigrants the intelligent ant
honorable will hesitate before choosing 70
their home, q state on whose fame is til
faint of reputation. Capitalists will form
their estimate of the character of the peopi
from the conduct Of their representative
will not expect honesty and fair dealing t