The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1869-07-30


loan the United States government three hun
dred millions of dollars at five per cent in
terest. naturally leads to reflections on the
strength of the natione credit aud the practi-
cability of Transforming the whole debt into one
bearing q much lower rate of interest than it
bears at present. 1t is said that the Secretary
OF the Treasury declined this offer, as he be-
lleves he can within year borrow all the
money he wants at four or four and q half per
cent, and that he contemplates advising such
loan next winter tor the purpose of paying of
the fye-twenties. Then, again, it is reported
that the Secretary has been informed from reli-
able authority that Uaited States bond bearing
four and quarter per cent interest can be
easily negotiated in Europe within six months.
Now, we do not know how much truth or
speculation there is in these reports, but they
are probably true in the main, for there is no
joubt the credit OF our government stands high
with the shrewd and tar-seeing capitalists of
Europe, and ia rising steadily and daily in the
markets of the world. II would be strange in
deed il this were not the case, as our Treasury
is so plethoric that MIR. Boutwell, hardly knows
what 10 do with the money. Then the rapid
liquidation Of the debt during the last few
months, and the vast resources and surprising
increasing wealth of the country, must inspire
confidence in the value of our securities.
Ignorance of this country and its resources
has been the only cause why our securities
have not heretofore reached a much higher
point in Europe. AS the truth becomes known
they must appreciate more and more.
Mr. Boutwell, ought to be the happiest Of
finance ministers, for never has one been more
fortunately situated. Month after month the
revenue comes in like food tide, and he gets
the credit for this gratifying state of things
and for reducing the national debt with por-
ton of his abundant means. Nor are we dis
posed to say anything to lessen the credit Of
the Secretary, for he is doing much better than
his predecessor, and shows disposition to take
good advice and learn. Still he could do much
more in reducing the debt and cutting off the
burden OF interest the country has to bear.
There is no necessity for keeping hundred
millions or more in the Treasury all the time.
There is no contingency likely to arise requir-
ing more money for the current expenses of
the government than will come in from month to
month and day to day. If the Treasury were
empty tomorrow he would soon have a sur
plus again, for the revenue is enormous and
perpetual stream. while the payments are only
at periodical aud stated times. II fifty mil
lions were applied to the purchase of the debt
that would reduce the interest and be saving
of three millions year. If hundred mil
lions were so applied six millions year would
be saved. And why not? The money lies
idle. It will never be wanted for anything
else. for, rs was ssid the incoming revenue
will be more than sufficient to meet all future
demands.
By using the currency on hand in this way
another good effect would be produced in
making money easy. Trade would be pro-
NOTED and the Wall street gamblers would
have less opp ortunities to lock up and speco-
late in money AS to holding large reserve
of gold to keep down the premium, that idea
is exploded. 1t has no such effect. The pre-
MUM is much more likely to be brought down
by gradually disposing of the gold at regular
sales, and thus diffusing it through the chan
nels of commerce and the country. With the
gradual extingushment Of the debt, and the
| appreciation Of our securities both at home
aud abroad, gold will naturally go down, and
with the increasing population and business Of
the country there will be a greater demand for
currency, and 1t viii become relatively more
|
| to specie payments. Any action on the part
| of the Treasury Department or Congress,
| except that of exti0guishing the debt as fast
as possible, is unnecessary and would only
prove DISASTROUS.
With regard to reducing tue interest on the
debt by process Of transforming the secur-
ties aud funding, the sooner this is done the
better. II can be accomplished at less cost to
the government and country now than when
the bonds rise higher in the market. We
would rather see the debt held at home thar
abroad, and thereby prevent vast drain o
specie yearly to pay interest TO foreigners bu
IL money is so much more valuable here, an,
the debt will be taken in Europe at four pc
cent interest let us make the best bargain W
can. BY all means let the interest on the deb
be reduced by some process or other. A
present il is not only an enormous burde
upon the people, but it locks up capital tina
would be employed in trade and in the devel
opment of the resources of the country 70
when capitalists can get eight per cent in cur
reucy on United States securities withou
trouble or taxation they will not invest thei
money in other things In every way tn
present high rate OF interest is ruinous. W
hope the Secretary Of the Treasury may b
prepared to submit to Congress next Decembe
some comprehensive plan for funding an