Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1869-11-25
NEW SERIES, NO. 387.

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and that the burden will be too great. That is nc
the question in controversy. The question is Doe
the debt exist? and If 50, How can it be paid with
in reasonable time with less revenue than a
economy 70 the Slater
The State is able to pay The State will pay, an,
we know Of no way BY which the payment can b
made but by taxation. Reputation or even a dis
position to defer payment will cost the state o
tennessee more than 1t will to pay the debt in tn
way We have suggested. Some propose 10 reviv,
tne Bank OF Tennessee as the fiscal agent Of tn
state, and others TO fund the present indebtedness
OF the state and that to become due for the mex
one or two years, as relief measured
How can the Bank of Tennessee be revived with
out money! And II it could be revived It woul1
have to pay tax to the United States government
OF SO on every 500 Of its notes paid out
That is the present tax on the notes on al
State and stock banks. But for this tax, ths
Treasurer Of the State could use portion OF tn
notes Of the Bank of Tennessee after they are paid
in as taxes. Say that Of the amount collected tbs
and so on each year until all were redeemed and
| cancelled; but to use them now would be to sell
| them at 10 per cent. discount
The debt might possibly be funded but thai
| would only be Offering the creditor about half OF
| what Is due him, and would be no saving to the
State, neither in money nor credit Ample pro
VISION should be made not only for the present
| deot, but Immediate steps should be taken TO re-
| duce the Indebtedness Of the State This can only
be done by selling the defaulting railroads of the
state THIS should be done at the earliest day prac-
llcdDle sen them Tor the bonds of the State. Let
the state bid its debt on any road that may be sold
| and II the State becomes the purchaser offer the
road for sale, payable in tho bonds of the State ana
advertise for propositions, etc. Allow any railroad
that has received State aid in the bonds of the
state TO pay its Indebtedness TO the State for such
aid at any time, In whole in part in the bonds Of
the state, the bonds to be cancelled, and the road
10 receive credit for the amount paid IN and can
| celed.
BY a judiei0us sale of the defaultIng roads for
bonds OF the state, and allowing other roads TO re-
I n hf.n d . . hang~
are well posted on the subject that the State debt
can De reduced to between seven and ten millions
| dollars In few years.
policy adopted similar to the one suggested
| would soon reduce the taxes again. and fully re-
store the credit of the State.
No estimate is made in the foregoing for a tax
for school purposes
Two items of indebtedness mentioned i'm the
COmptrolers Report as due to the United States
OF S5l 800 AZ for two of the railroads. have never
been assumed paid, other than by Legislative act
NASHVILLE, Tenn, Nov. II, 1869.
Now, without coinciding with every
suggestion contained in the communica-
ton, do most heartily approve of the
views of the author in regard to the re-
sources of the State; to the pledged honor
of the State; to the necessity of retrench-
ment and reform in the expenditures of
the State to the duty we owe to ourselves
and our pOsterity to pay the debt, and the
only mode by which it can be paid-and
that is by increased taxation, and by a
faithful application of the taxes, when
collected, to the Just Indebtedness of the
State
Mr.. Speaker, we must look this matter
full in the face, and decide what we will
do. No halfway measures viii suffice.
The remedy must be applied, or the con-
sequences are fatal, as win be seen from
the following statement, for which | am
indebted to the editor of the Nashville
UNION AND AMERICAN, and l gladly avail
myself of the result of his labOrs:
THE STATE DEBT
In order TO arrive at correct conclusions We must
be fully informed to the facts. We have hereto
fore collated from the report of the Comptroller of
the Treasury and other reports made to the Legis
ature, statements showing that the liabilities of the
State were $40 600 OOO We again recur To the
subject, deeply impressed with its Importance and
satlsned that II Is only by fully comprehending
situation IN all its bearings in all of its length
breadth and thickness, that legislators pre-
pare themselves for the duty imposed upon them.
with but little regard to the Indebtedness of the |
past let us see how will stand in the future not
the distant but the immediate future |
Look at the following figures, showing tina con-
don OF the State Treasury at the end Of the pres
ent fiscal year, October 80 1870, eIciUdfa1 the
bonded debt Of the State proper and the bonded
debt upon railroad account:
crest on State debt due July J. |
1853. ;...........-..... -. sllOO,OOo 90
Outstanding warrants az ainst the Treas
ury, Oct. 81, 1869 ........-.... 1lg O00 90 |
Amount claimed by Messrs. Ward
Briggs, penitentiary ................ 2OIOOJ 90 |
BANK Of Tennessee notes receivable for |
State taxes 100000 90
borrowed money: ..........-. 10000 90
Edgehelt aud Kentucky and Mem
phis, Clarksyile and Louisville rail
roads ................ XII SEQ On
Interest on state debt due Ian 1850 "a
Aggregate Oct 90, 1870 .......... s., 576, 800 90
It viii be Seen that this statement includes no
bonds either Ot the State proper on railroad ac
count.
To meet this Indebtedness the Comptroller esti-
mates that there viii be paid into the Treasury
from Oct. l. 1859 to Oct l. 1870 as State tax pro-
vided the revenue laws are not changed to
lessen the amount, the
Sum g. 429. 900 %
From railroads, say -............... 10000 90
From privilege tax $1,000 90
s2,216,OOo 90
From this We must deduct for cur
rent expenses Of the state -...-..... 4O1,O1G 90
This will leave balance from receipts
into the Treasury for fiscal year
lS69-IO 81 5lb,OOO %
Deduct this amount from the Sc 1876 $50 90 above
stated to be due LIST October, 1870, exclusive Of
bonded debt proper, and railroad bonded debt Il
State, and We have the
Balance for Oct l. 1870 ........... 81 7GO $50 90
Add to this interest on State debt due
LIST Of January and July, 1871 81 100000 %
Amount against Treasury Oct 30, II So 800 $50 90
Deduct amount paid into Treasury in
the same time as aboye-........... $4,000 % |
-----
Balance against Treasury OCT 30, II S. 14456O %
And we go on from year to year, increasing our
Indebtedness, unless some remedy is applied % re-
hevs Us OF our financial difficulties
The bill now under consideration pro
poses for the next two years to collect one
dollar on every hundred dollars of taxable
property, including all State, county and
corporation bonds, and to collect from
privileges, suits in court and polls, the
same tax now provided by law, and with
the proceeds in three years we will be able
to paw off the notes of the Bank of Ten
nessee, which the Supreme Court of the
United States has decided the State of
Tennessee is bound to receive in payment
of taxes: the current expenses Of the
State; the outstanding warrants on the
treasury; the borrowed money, and the
interest ON our State debt.
1t is true that the increase Of taxes as
compared with what was levied and col
lected previous to the war is very great.
The fact is, it may be justly described as
enormOus-on thousand per cent. Yet
this increase, heavy as it is, should not
deter us from doing our duty if the ne
cessity upon us is obvious and such as
we cannot avoid unless by reputation.
If the result mentioned can be thus
reached, is it not better for us to accept
the situation and act promptly and advis-
edlv than to keep on in the same path we
have been pursuing, growing worse and
worse financially, until bankruptcy is mp
on us!
Other reforms are absolutely required,
Mr.. Speaker, in addition to this increased
rate of taxation-and which must be
adopted-or even the revenues proposed
to be collected from the people, by the
bill now under consideration, will be
wholly inadequate for the purposes de-
sired. We must reduce our State Govern
ment expenses down to $4,000 or
under. This we can do. Wise and pru
cent lt8lsldliOH VIII a'COlAplioh Via w
want, and merely suggest to the Senate
the prominent evils to be remedied.
Our penitentiary must be made self
sustaining. 1t has cost the Treasury of
the State, since the close of the war,
| 1903. OGC, already paid, and an indebted
ness claimed by Ward & Briggs, Lessees,
of $2O7, 900, making the sum of $780,
| O66 This drain must he stopped. IL
can be. Before the war have before
me report of the then Su-
perintendent, in 1859, showing that the
| Peniteutiary was self-sustaining. Why
can it not be made SO nOwl Competent
persons, as / am informed, propose to
lease the Penitentiary for a termOf years,
and undertake to keep the cOnvicts Sc
cure, and, for their labor, pay all of the
expenses of the Institution. Let such an
4 Ill