The sun. [volume] (New York [N.Y.]) 1833-1916, 1870-02-09
The Legal Tender Decision.

The Supreme Court of the United States
has decided that the act of Congress Of
Feb. %, 1902. making greenbacks legal
void, SO far as respects obligations which
were incurred before its passage The Ian
guage of the decision Is explicit We are
obliged TO conclude that an act making
mere promises to pay dollars a legal tender,
in payment of debts previously contracted, is
not means appropriate, plainly adapted,
really calculated to carry into effect any ex.
press power vested in Congress; that such
an act is inconsistent with the spirit of the
Constitution, and that it is prohibited by the
Constitution" ,And, in the particular case
under consideration, it is held that the owner
Of promlssory note made before Feb. %,
1862, is not bound to receive greenbacks in
payment Of it.
The Court, in delivering its opinion, has
avoided meeting none Of the arguments com
monty urged in support of the retrospective
validity of the act IN question. 1t admits
that Congress intended tho act to apply to
previous transactions, but boldly declares
that Congress had no constitutional power TO
carry out its purpose. Amy law pretend.
ing to compel man who lent money or
sold property in exchange for promise of a
certain number of dollars, Mt a time when
there were no dollars but specie dollars. to
receive paper dollars Of inferior value in ray
ment, il pronounces an attempt to impair the
obligation of contracts, and a violation of
those provisions of the Constitution which
protect private property from being taken
without compensation, aud without due pro
cess Of law The assumption that such an
attempt can he sustained as an exercise of
either the armaking or the coming power
IL ridiculcs as utterly untenable. Greenbacks
are not coin in any rational sense, nor is their
emission in place of coin any moro an incl
dent Of war than 1t is Of carrying the mails,
regulating commerce, OF borrowing money.
There is talk of probable reversal Of this
decision when the two existing vacancies in
the Court shall have been filed. Only four
Of the present Judges concurred in rendering
! il, against three who dissented. If the two
new Judges should agree with the three dis
seutients, there would be five, or a majority
Of one, in favor of reversal Assuming, how
ever, that the decision will stand, the conso,
serious.
| Among other things every person who has
deposit in savings bank made before
Feb. %, 1862, will be entitled to receive in
! gold the amount OIL that deposit, or 80 much
of it az remains undrawn. Something like
| $100000,000 is due in this manner by the
savings banks of this State alone.
On the other hand. these same savings
bGNks will have the right to demand gold
for the loans they had outstanding on the
Goth OF February, 1862 These loans probably
equal the amount of their liabilities Of that
date say another $10O.0OO000,
The life insurance companies of this State
hold probably not less than $25,000,000 o.
mortgages made before the date of tho
Legal Tender act, and the fire and marine
insurance companies as much more; say
$4,000, 900 in all.
All the State, city, and county bonds o
this and other States issued prior to Feb. 25
1862, are by this decision payable in gold
At rough estimate this class of securities
will amount to $2OO,0O0OOO,
The indebtedness of our railroad compa
mics affected by the decision is also very
great. In 1869 there were $4,000 miles o
railroad In existence In the United States
Allowing on an average $4,000 of bondot
debt to the mile. which is an extremely low
estimate. We have $500, 100000 for this item
alone.
Summing mp these various amounts. WI
have an aggregate Of $40 O00, 00o which ha