Des Arc weekly citizen., 1868-12-22


 1 amply sufficient return for the invest : nient. The general impression as t 7 the exorbiiancy of the existing rate Q , interest has led to an inquiry into tn, : public mind respecting the conaidera z ton which the Government has actual [ Iv received for its bonds, and the con clusion is becoming prevalent that th' l amount which it obtained was in req money three or four hundred per cent less than the obligations which is pait
 in return. It cannot be denied tha we are paying an extravagant percen tage for the money borrowed, whicf was paper currency greatly Appreciated
 below the value of coin. This fact it made apparent when we consider that
 bondholdcrs receive from the Treasury
 upon each dollar they own upon
 Goverrmcnt>sccurit six per cent, iu
 gold, which is quite or nearly equal to
 nine per cent, iii currency; that the
 bonds are then converted into capital for National banks; upon which those
 institutions issue their circulation bear ing six per cent. interest; that they are
 exempt from taxation by the Govern
 ment and the States, and thereby enhanced two per cent, in the hands oi the-holders and thus have an aggregate
 of seventeen percent. which may be
 received upon each dollar by the owner
 of Government securities. A system that produces such results is justly re-
 garded as fayoring few at the ex-
 pense of many, and has led to the fur ther inquiry whether our bondholders.
 in view of the large profits which they have enjoyed, would themselves be n ts&. lnsr pf nd An1o fod L.
 ness on plan which would yield them a fair remuneration. and at the same time he just to the taxpayers Of the nation. Our national credit should be ' sacredly observed; but in making pro-
 visions for our creditors we should not
 forget what ia due to the masses of the people. 1t may be assumed that the
 holders of our securities have already
 made upon their bonds larger amount than their original :nvest,nent, inea-. sured by gold advancement. By this statement offacts it would seem just and equitable that the six per cent, 1 interest now paid by the Gover,lmcn. should be applied to the reduction of the principal in semi-annnal instai- ments, which in sixteen years and eight months would liqu'date the entire national debt. Six per cent. in gold would at present rates be equal to nine per cent. in currency-eqmvalen to tlIe payment of the amount in half the iine-iii fraction less than seventeen, years. This, in connection with all the other advantages derived from this. investment, would afford the public creditors q fair and liberal compensa- ton for the use of their capital, and with this they should be satisfied. The lessons oft the past atmOnish the lender that it is not wellto be over anxious in exacting from the borrower rigid com- pliance with the letter oi the bond. Provision should be made for the pay ment of the indebtedness ofthe Govern ment in the manner suggested, and our country willrapidly resume it's wontcd prosperity.
 Interest demsnds that some measure should be taken to release the large amount of capita, invested in securities of the Government. II is not now merely umproductivc, but in taxation annually consumes Sl5U000,000, which would otherwise be used by our enter prising people in adding to the wealth Of the national commerce. which at one time successfully rivalled that of inc great maritime powers, has rapidly diminished, and our industrial in- terests are itl depressed and languish- ing condition. The development of our inexhaustiblc resources is checked, and the fields Of the South are becom- iny vast for the want of means to till them. With a return Of capital new life would be infused into the paralizcd energies or our people, and activity and vigor imparted to every branch of industry. Ourpeople received encour- a9ement in their efforts to recover rom the effect Of the rebellion and injudicious legislation, and 1t should be the aim ofthe Government to stimu- late them bv the prospect of an carly relief from it's burdens which impede their prosperity. It we cannot lake the burdens from their shoulders we should at least manifest willingness to ieip to bear them. In referring to the condition ofthe circulating medium shall merely reiterate substantially that portion Of my last annual message which relates to that subject. The pro- portion which the currency of any country should bear to the whole value of annual produce circulated by it's means is a question on which political economists have not agreed, nor can it be controlled by legislation, but must be left to the irrevocable laws which everywhere regulate commerce and trade. The circn atiDg medium will irresistibly flow to those points where it is in greatest demand. The laws of demand aud supply is as unerring as that which regulates the tides of the ocean; and currency, like the tides, has its ebbs and flows throughout the commercial world At the beginning uf the rebellion the bauk note circula- tion Of the country amounted to not much more than S200, ,0t0.0O0; now that circuIation -ofthe National Bank notes and those known as legal tendcrs--is nearly S7O0.OO0.OO0. While 1t is urged by some that this amount should be in- creased, others contend that decided reduction is absolutely essential to the best interest of the country. In view of these diverse opinions it may be well tu ascertain the real value of our paper issues when compared with n metallic or convertible currency. For this purpose let us inquire how much gold and silver could be purchased by the seven hundred millions of paper money now in circulation, probably mot more than half the amount Of the latter, showing that when our paper currency is compared with gold and silver, its commei cial value is com pressed into s350,000,0O0. This strik- | ing fact makes it the obvious duty of the Government, as early as may be consistent with the principles of sound political economy, to take such meas ures as will enable the holder Of it's notes and those of the national banks to convert them without loss into spe- eic or it's equivalent. A reduction of our paper circulating medium may not neccs sariiy follow. This, however.