, 1869-05-14
MR, B0UfWELL's "s1HKINa FUND"
POLICY.

It is announced that Secretary Boutwell,
has determined to carry out the la Vi Of 1856.
establishing q sinking fund, and that the
bonds he is now buying VIII not again be
issued, but will probably 60 into the sink
ing fund. Tie use in such a manner Of tho
term "s,nking fund looks very much like
IN attempt to revive the exploded idea thnt
tlere can be some other mode Of 'tsinkiug"
or e1tinguikhiDg public debt than by har-
ing nn excess Of receipts over expenditures
aud by applying this excess to the payment
and cancellation Of bonds. Tie act Of 1862
1.ses1el to declares that the duties on im-
ported goods shall be paid il, coiu, and that
such ccin, after paying the interest on the
debt. shall be apphed-
''2> To tne purchase or payment Of one per
he sie each FISCAL year after the nTst dav Of 1uy.
l-Gs witch Il 10 be Set apart as alnktnX fund,
aHAthe taitft~. Of *h}ch ahAl u Hte E1ahnes Ge
debt as the Secretary Of the Treasury shall from
lime to ttulr direct
THIS clIose contains on the facc Of it an
uE'ss,1d,ty aud au obscuzity. Il Vns absurd
toprovide TIM. one per cent Of the debt
, should be paid CT purchased during these
in excess Of our revenue thst we could not
avoid doubling the debt every year, instead
,f paying OF one pet cent Of il. It is
-i.he1 an ohscsrity OF blundes to provide
ti:at the l'oction Of the debt purchased or
Isnd kLo;Id ''t,e set apart as a sinking
fund, and the interest thereon applied to
HE purchase CT payment Of more debt. So
.1n1. 20 90 nj
nothing Is left Of il to set apart for any
4,ut,nAe So 1unch OF the debt as Is pur-
chased sy the United States Is also, we
believe, ended in law and effect, &C
coming 10 the raainess teaehings Of com.
nou sense. We do not believe it is mort
than figure Of speech, mere idle fiction
10 say that the United States car
hold debt due from itsel
10 itself. I. can doubtless buy its Owl
bonds and reissue them, but every time il
buys Il bond it virtually cancels the debt
and wien it reissues it., it bor1uvs money
1t is a principle Of law thas no individual o'
corporation Gin ope itself, and when he o.
it buys one Of his or its own debts the deb
is cancelled. The:ssame principle applies il
aqSlc 10 tpe government
Tie eurposition that anything can b.
saved or mnae by the government main
tanning the bonas it has purchased, il
nominal existence under The title Of "siuk
:. ing FIND, WIS fully tried in England, ens
found to be a delusion. The interest Hhicl
:sec1ues On the bonds which form the sink
ire fund is paid By the Treasurer Of tn
United States into the sinking fund, hn
reraii to the United States Treasury out g
she sinking fund BY check Of the eam
eEncer. 1t is merely taking money fsons Ii
right pocket to put into the left, encumhe
-, ing the Treasury books with An extra al
; eou:.t. aud an accountant to keep it.
Tie purchase of bonds blythe Seeresa,
to the extent Of the surplus gold IN u
Treasury is his sound and inevitable polio
rpor which the country has long been
pessIy agreed as it can ever be on any poll
r,ior to its tzial. But WHEN these bends u
Irrehaeed let them be securely locked L
cancc!lcd and erased from thepubic debt,
i.eiug so much debt merged, lpsr'f, ami
bird ly the oct Of purchase. The intert
saved On the amount By which the debt
diminished viii nlwaSs equal the inter-
t.n.a1ked up" on the amount Of The social
sinking fund, and the country will be spar
the modification u seeing the "sinka
Fund delusion, 60 long after its e1plosi
elsewhere, apparently incorporated into a
n.aSle a leading es1or in our own fananc'
administration.