The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1869-07-12

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WASHINGTON, July IL, 1869
Reforms in tho Treasury OBSERVATION-DISCLOSURES
Of Checks and Balances in the Printing of
the National Currency.
Among tho many reforms introduced In the man.
agement Of the Treasury Department by Secretary
Boutwell, is complete system OF checks and
balances In the printing OF the national currency.
Heretofore this has been conducted in such con-
fessedy loose and careless manner that the country
was constantly threatened with an Eruption OF
spurious paper money. With oil Of Mr.. Bourwell's
predecessors since 1850 the notion seemed to pre-
vail that S. NJ Clarke, until recently head OF the Cur
rency Bureau, was an OFFICIAL whose services were
Indispensable to the running of the department. The
reason OF 1t was that Clarke was about the
only person who knew, or apparently cared to know
anything about this important branch Of the Trea-
sury He had the thing In his own hands and man.
aged 1t In his own way, and the government was
compelled to trust TO the honesty OF single man
where hundreds Of millions were at stake, not to
speak OF the public confidence This was among the
FIRST abuses that attracted Mr.. BOutwells attention
ciarke's exit from the departments was also the
signal for the abandonment OF the old system. The
paper upon which the currency 10 printed is all
made at one establishment, located in Pennsyl.
vania, near Philadelphia. 1t u manufac-
tured by peculiar process. the special
virtue OF which 10 that 1t defes imitation.
THIS il q conclusion reached by the best experts
after several tests. The Secretary Is not content
to trust to the honesty. however rreproachable 1t
may be, OF the owners OF the paper mill. He has,
therefore, stationed ut the establishment q special
sworn agent Of the Treasury Department. whose
business 1t Is to see that no fraud Is perpetrated
either upon the government or the people. He
counts or counted every sheet that Is made and
ut the close OF each day informs the department by
cipher despatch the quantity Of paper on hand at
the mill the quantity in transit by express to New
York. and how much has been received by the two
bank note companies engaged in engraving and
printing the currency in New York. The receipts OF
the express company and Of the bank note companies
are checks upon this mans statements and show
any discrepancy at once. When the mill where the
paper made stops ut night essential portion Of the
machinery used In its manufacture Ia taken out by
the Treasury agent and carefully locked in q safe
provided for the purpose. This, Of course prevents
any candesrine manufacture Of the paper while the
government agent Is absent. The plates used in
printing the notes are all engraved BY the respective
bank note comprehensive National and the CONT
mental Of New YOrk-where the printing Is done.
Here again q careful system OF checks has been
adopted by which 1t will be almost impossible for
ton. The is true Of the reception OF the
rency at the Treasury Department Mr. Boutwell's
object is to keep the control Of this important
OF the hands OF man, distribute the RESPONSE
bihty among many. and make each check upon
the other.
The Sinking Fund Of the Treasury Department
was established under the fifth section OF an act OF
Congress approved February .5 1862, popularity
known as the illegal Tender act" That section
provides:-
That ell duties on imported goods shall be paid
thorized to be issr ed and by law receivable In pay
ment OF public duties and the coin so paid shall be
set apart as special fund and shall be applied as
terest the bonds and notes OF the United states;
second, to the purchase and payment Of one per
States, to be made within each fiscal
year after July l. 1882, which is to be set apart as
sinking fund, and the interest OF which shall In like
manner be applied to the purchase or payment Of
the public debt, as the Secretary Of the Treasury
thereof TO be paid into the Treasury Of the United
States.
The only other law bearing on the subject is
joint resolution approved March IT, 1884, which pro.
vides:--
That the Secretary Of the Treasury be authorized
70 anticipate the payment OF interest on the public
debt by period not exceeding one year, from time
to time either with or without rebate OF Interest
and be is hereby authorized to dispose Of any gold
In the Treasury of the United States not necessary
for the payment Of the interest on the public debt;
provided that the obligation to create the sinking
fund.- according to the act OF February 25 s82 shall
not be impaired thereby.
Up to the time that Mr.. Boutwell, became Secretary
Of the Treasury these acts remained practically a
dead letter on the statute book They were not car.
ried out partly owing to the exigences Of the gov
eminent, and partly through Encouragement Of the
finances Early In May, about q month after Mr..
Boutwell, was placed at the head OF he Treasury, he
came to the conclusion that time to carry the
law into effect. He argued correctly that begin
ming must be made and the sooner the ice was
broken the better. The first purchase OF bonds was
made on the 18th OF May. The total amount
purchased chat month was $3,070,OO0. The
cost OF the premium on these bonds (all
Of them nve.twenty six per cents) was
Sass, ssl co. making the total amount Of currency
paid out by the government $s65s,ss co. Since the
1st Of June the purchases have been more regular.
The following table shows the amount OF bonds
purchased, where they were bought, the premium
paid and the total amount OF currency expended in