The evening telegraph. [volume] (Philadelphia [Pa.]) 1864-1918, 1869-01-13

Totals. OOO 900 600 $270OU0 900 81 30 600, ,OOU
Here we find saving to the taxpayer OF
$3.50 0O0 goo interest," which the bondhOlder by
reinyesting his first Sl25,O 600 for 1874 years
his second for l42a years, and so on through the
series receives by vi tue OF such an Investment.
and at the same time Is treated equitably. The
interest beipgnow settled for 1879 years. there re-
main S2a years before the Government would
be required to make any payments upon Lhe
principal, but If IL should now choose TO antici-
pate 81 600 600 900 of that principal In annual
instalments of SIPS 600 GOO 1t would be entitled
to an allowance OF interest for SUCH prepay
ments, which allowance, added to the $3.50 100000
ssved wpua maze he 69ia saviag Of
years all the interest and onc.hslf of the prln.
cipal of the debt being paid, we would have
ample time to create "a new loan, at a more
favorable rate Of interest, to pay the remaining
10 effect this arrangement the Government
might pay the bOndhOlder ST. O0J, 900 900 of in
terest bonds, redeemable at the times and sub
ject to interest in accordance with the plan, we
have already exhibited. That these bonds
would be equivalent to cash is obvious, for the
reas on that the interest paid on them yields the
service OF cash until they become cash in fact
snd when they do become cash in fact, the In
teTest upon this cash retnvested, together with
that which was paid for Temporary credit
amounts to The same sum as would be paid in
period of 1873 years by our present method.
1t will be observed that the heaviest pay
ments occur at the beginning and gradually
diminish throughout the series. AS We
doubt our ability to provide for TINS
, Immediate addition to our burdens. The ad-
that IL is vol tn the effort to accomp plisn. We
believe no Increase OF taxes wou, ID be required,
provided the Government cuts off many OF It's
useless expenditures There are two ways,
however, by which this objection may be met
The first resting upon the Delief that the people
can bear their present taXation and even more,
If the business interests of the country be deve-
loped to the highest stage of prosperity. Tne
proposed plan, by freeing capital. forces 6usi
ness activity. The people having furnished the
bondholder the means by which he can make
his interest, instead Of retaining this means
and making it themselves for him,
now have his assistance, and so much time as
would be lost in acquiring the interest for him
is saved to them for other pursuits while he
becomes producer of wealth to the extent of
the time they have gained. This addition to
the productive resources OF the country should
be at least equal in value to the sum of our
present taxes. The other objection, resting
upon the idea of inability to bear our present
taxation, and therefore favoring a reduction,
involves the necessity of providing for the first
heavy payments by a loan maturing when our
payments are the iightest, which would be just
after our interest bonds were settled, and when
we were ABOUT to pay the rst instalment on the
worth. a fraction over sS3,6OOOOO; the second
by less than 500, ,000, ,00O the amounts gradually
increasing to the end OF the period. We might
therefore, borrow 5000 OO0, 600 in gold. payable in
twelve years, with interest, and use the gains
from our discounts to liquidate it at maturity.
This form, however, on account of the Interest
on the twelve year loan. would reduce the
savings on taxation to about 1856 900 000 We,
however, prefer the first method, partly on
account of It's greater saving, and partly be-
ing from $4,000 900 to SlO0,OOO,OOO OF gold,
and also prevents il from selling gold,
of $75,OOO,O 600, by which act the people
have had taken from them over $50 100000 of
their earnings In a manner not recog lied by
any of our laws for the collection OF taxes. The
plan we have presented tends to return to
specie payments through the establishment of
the necessary condition by natural causes,
without the interposition of legislation. The
employment of the gold now held by the Gov
eminent would throw so much more upon the
market to be carried, anu 10 the extent OF the
quantity thus thrown, make IL more difficult
would command it at a less discount than they
now do. the volume of the legal-tenders could
also be reduced without contracting the active
currency. The national banks being conn PEELED
to hold portion of this currency as a reserve.
much as Is thus reserved Is coEtractton
already accomplished; but so far as redemption
is concerned, these reasons delay the process in
the proportion their amount bears to the whole
Therefore, when tne Government pays the
banks their share of the interest bonds. IT
nlget autnofize t1e sunseituelon aI OF tnese @
tire the latter as fact as IL acquired the means
to do so. This could be done by cancelIlug such
legal. tenders as the Government would receive
at any given time, and authorizing the banks
to issue a like amount of their reserves, aud
so continue the process until The whole were
Thus we would introduce the precedent con-
ditions for resumption more effectively than
could be done by any act of legislation which
Ignores these conditions. Finally, whether the
nlan we have suggested should be acce pted
in the form presented, modified to meet
points where It might not prove feasible, or an
entirely new one be adopted, IL Is a necessity oi
our financial situation to create some plan
covering the whole question of payments in al
its parts, even though such plan were defective
in many points, as the people, when they knew
ali that would be required of them, would adap
their affairs to the situation, and, working al
a unit in this direction, carry the whole matte
Through more effectively than could be done by
variety of plans, perfect In themselves, ou
not possessing the essential attributes OF unity
j. S. M.