The daily phoenix. [volume] (Columbia, S.C.) 1865-1878, 1868-08-22

States was equal. Why the disparity
lnow2 There must be Inismanage-
ment somewhere. s
It was after the election OF the
Legislature and of State officers, but
before there had been any practical
Indication of the financial policy of
the State, that the bonds stood at 6S.
A few weeks session Of the Legisla-
ture has reduced these securities to
but little more than so, and few
weeks more, if the policy indicated
is pursued, will reduce them still
lower.
I enclose, for publication, the
copy of bill entitled "a bill to close
the operations of the Bank of the
State of South Carolina" introduced
into the House of Representatives on
Tuesday last. L am informed that
it will probably pass, and, if so, it
places an extinguisher upon the little
credit left our unfortunate State.
The proposed Act refers to certain
proceedings in the Court of Equity.
These proceedings consist of q bill
filed by Dabney, Morgan & Co., for
themselves ana others, holding bills
or notes of the Bank of the State,
asking to set aside, as ''impairing the
obligation of contracts" the Act of
the Legislature of 1865. appropriat-
ing the assets of the Bank of the
State, first, to the payment of the
fire loan bond-holders in Europe;
second, to those in the United States,
and third, to the bill-holders, and
seeks the aid of the court to reverse
this preference and appropriate the
assets, first, to the bill-holders and,
only after payment of these in full,
to the bond-holders. Next in order
among the proceedings come the an
swers of the Bank, of the Attorney
i! General of South Carolina, of Bar
ing Brothers & Co., of London,
representing fire loan bonds in
Europe, and of Dawson and others,
representing fire loan stock in Ame-
rica. All these answers sustain the
validity of the Act of 1865, claiming
that the appropriation of assets by
that Act is equitable in itself, and in
conformity with the pledges con-
tanned in the Fire Loan Act of 1888.
Both the complainants and defend
ants claim that the assets are already
appropriated. The court, upon hear
ing the pleadings, ordered the assets
in dispute to be held by the bank
under injunction until the rights of
the parties could be determined.
This precious bill proposes that
the State should step in and. with q
strong arm, thrust aside these con-
testants. seize the funds in contro-
versy, dispose of them at the discre-
tion of the Governor, and place them
in the Treasury.
What State, going back thus to the
morals of bold Robin Hood, can ex-
pect to maintain credit in the modern
commercial world?
So much for principle. But, prac-
tically, what time to order the sale
of such assets as the bank holds!
None of these assets will sell at par,
and few at as much as fifty cents on
the dollar. Without, too, the plea
of necessity" for the proceeds are
to be deposited in the Treasury, and
a separate account" kept of the
fund; withdrawing it thereby from
ooO. oCC, tOO, tu0 ulS-
cretion given to the Governor in the
sale of assets to the amount of
81, 100000, at q time when stocks
rise and fall 20 per cent in a day!
Were he as enterprising and as cor
rupt as Spoons Butler, he might, if
he pleased, in a few weeks, become
almost as rich.
Section of the bill adds to what
has hitherto been considered rs the
State debt, about $125, 100000. If
this proceeded from an extreme sem
sitiveness as to national honor, and
scrupulous regard to good faith, it
might, perhaps, increase public con-
fidence rather than impair it. But
upon what ground is it, that "honor
and good faith" are less involved in
regard to bills not "filed in the Court
of Equity, on or before 1st June,
1861" than in regard to those which
have been so filed? So far as the
State is concerned the obligation is
the same. The inference is not a
forced one, that those persons not
filing the bills they held, confided
solely in the "honor and good faith
of the State" while those "filing"
distrusted the State, and sought to
subject the assets of the bank. Yet
the bills filed are to be funded, ;"
while the bills not filed are rejected.