, 1869-05-02
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lEb1 o'oAeN IN ts<'9-b l,{3G 900
Present bonded deb,. eb,.,...........,. F,ssas0
F7om this IT will DO seen that, during the
year We have added 81 ,4Oo, 900 to our debt,
and that the amount redeemed OF raid of
WAS SO trivial that it mikes hardly percep-
tihie difference in the totals
That the delt Of Chicago is rapidly as
s,.,nine magnificent proportions is proven
i.y tie item Of intercst, Our bonds bear
seven per cent interest We havo, thete-
fore, to pay over half million of dol
lars annually, without thereby diminishing
the debt. Tho annual receipts and a1pen-
futures Of Chicago have long sinoe doubled
those Of the State Government; but 1t is to
he regretted that, while We have adopted
the policy Of borrowing money beyond the
present revenue for permanent improve
n.ents, we have almost totally ignored alt
measures foz the payment Of tho debt. A.
public debt with regular system for its
payment is not matter Of such u1agni-
tndo, if there he in force any
permanent arrangement for its even
trial retirement Is it not time
for the city Of Chicago, which owes debt
equal to the average Of that Of the several
States Of the Union, to devise and adopt
some systcm which, while it will
restore the creait Of the city, will not iu-
teHe1e With the necessary improvements Of
permanent character which are indis-
pcnsable to q growing community like this I
The Massachusetts, system Of finance works
admirabl:::, and our city government might
profit ty it. The present one, of paying one
deb. by another debt, und thus piling
millions upon millions, until in the end the
annual levy for interest will be equal to
even our present c1travagant ta1es for all
purposes, il rery expensive.
The State of Massachusetts, has higher
credit at home and abroad than any other
State, and higher than that Of the United
States, Her 5 per cent bonds sell nt par in
gold in London and Fraukott, while the 6 per
cents Of the United Stat2s have been much
below that rate. It is true Massachusetts
tonds are payable, intercat and principal, in
gold; but the United States honda are Of the
some character. The difference, however,
is in the system Of finance. When that
State wishes to borrow million Of dollars
it issues bonds payable in ten years The
Law authorizing the loan requires that
the proper officer shall, in his annual esti-
mate Of taxation upon the property Of the
towns in the State, include such rate as
viii produce the amount required to pay
the interest on this loan, and also ane-tenth
OF the principal The proceeds Of this tax
is applied first to the payment Of the inter
est, and the balance is invested in interest
bearing bonds Of the State, OF the General
Government, CT nicA other investment
as VIII yield an interest a. least
equal to that Of the original debt. The
second yesr the ta1 for interest On
the loan is reduced one-senth, and
is reduced in the same proportion
annually until, at the end Of The ten yaars,
the interest ceases and the debt has hean
ertngulshed In ten yeara the loan is
closed m and The tax ceases Nov con
t1ast this with the policy Of Chicago. Ne
issue million Of dollars Of per cent ten
year ''ontis and sell them for S3G0, 0,0NO.
We pay annually for ten years so, ,0dD In
tercst, or in the aggregate, $7On,0o0.
At the end Of ten years VIC take m these
Londs l'5 another issue Of ten-ycar bonds
for : ,oHO,OG0 on which we pay annually
s''-aoo, OF $55;5,O 900 for tho ten years; and
thus We 80 on adding to the principal and
interest, and never paying anything. For
loan Of Seeo,ooo We pay for twenty ytars
sl.s35,ooo, and yet owe tie principal,
sl.o5o.Mo. II, instead OF this plan, VIC had
adopted the other, we could sell OUT bonds
at par at & per cent. and at the end Of ten
yra1s would have paid the debt, both r1in-
ciEal and interest, at total outlay of
@l.:rO.tGO.
I. our present debt of eight millions Of
dollars nas refunded in forty-ycar per
cent bonds, unl Il tax levied for the interest
and one-fortieth part Of the principal, au-
n',alIy. we could pay the entire debt, prin-
ta1Sl anu interest, for less money than W.
shall pay fur interest alone during that same
time, on TIE same debt Under the present
plan, at the end Of the forty years, We shall
have paid for simple interest on the :Ss,-
"co.tNh Of debt, 81, ,4W, ,ND. Under the
'sher plan, al the end Of the forty years va
Shall have e1tinguished both principal aud
Interest," at IN actual outlay for both Of hnt
s'7.S*;;s.'eo. During that whole forty
'''ats' we shal have to raise annually, by d.
,ect taxation, S5c0, 900 for interest alone.
Under the other plan re shall have to raise
:nnt:ally. for both principal and interest, An
:versse Of s4l5,ce0. or less by s7100,O
annually than will be required to meet the
irt,-tst alone.