, 1870-02-08

xodu4HH 1&1G UkGls
Mr. McCra1y, Of Iowa, has introduced, in
the House Of Representatives, very sensi-
Bile joint resolution derlaratory Of the
sense OF Congress as to the best means
of preserving The national credit. We
hope to see rigid and thorough discus
sion Of The principles it embodies, which
are: l, economy; 9, the vigilant collection
Of the revenue, and application Of the sur-
plus thereof to reduce the national debt;
3, no appropriations for public buildings or
internal Improvements that can safely
be postponed, and none whatever for
the purchase Of foreign territory
until efter our bonds aud currency are at
par with gold; 4, as soon as tho credit OF
the government permits, the funding Of the
c per cent bonds at "a lower rate Of inter-
est, s, the substitution Of per cents
for 6 per cents as the basis Of The Nation
al Banks (?); G, the utmost reduction Of
taxation consistent with the payment of
expenses. interest, md $50, ,000, 900 per an
NUN Oh the principal; and Z, the return
to specie payments. by enhancing the credit
Of The government and making its ohliga-
t!ons equal 10 gold.
The first and second policies have been
tried under Grants administration, and
have already advanced the credit Of tho
government, whether measured in
the gold value Of it's bonds or OF its
currency, about Is per cent. The
,hird is equally as good, and we regret that
the present administration is disposed to
continue buying real estate. Let us have
no more Alaskbs. The favor Of anue1ation
is far greater to the territories We annex
than it can possibly be to us.
As to funding bills, it is quito clear that,
until the 6per cents rise above par, the
debt they represent, or the money to pay it,
cannot be borro~ed at lower rate Of inter-
est Nor is it Likely that the = per cents will
rise above par 50 long as they are liable to
be paid of and the government lacks the
means to pay them As the ordinary rates
OF interest on money in this country has
generslIy averaged more than 6 per cent,
it is certain that, If the government could
borrow only Of American capitalists, there
Is no reason to suppose that ut my
time during the present century the
rate Of interest on the debt would be re-
duced at all. IN considering whether
Europeans are likely to lend Us at much
lower rate, We must compare this with their
other means Of investment. It is true that
the English per cent annuities sell at o.
But it must be borne in mind that on mauy
Of them England never borrowed more
thAn 60 per cent Of principal, and on such
Ebe is really pnying per cent on the
amount borrowed; that, we're she compelled
to go into the market to- day, as We are, and
borrow Sa,loo, 100000 tor, which is
the same, refund it,, about IS fast
as she could accomplish go great
a loss her consn1s would certainly fall.
The surplus of loauable capital Of Eng
land is several times as great per capita as
ours. But the chief cause OF her high
credit il thht she is not borrower, because
her bonds do not mature, being in the form,
Of perpetual annuiues. Pct her to the ne.
cessit, OF borrowing even so small sam a.
will carry On Crimean or Indian war and
her couso.s drop and her rates Of interest
rise. Our government will always be The
largest borrower in the world until its deb
is eiGler funded into annuities, terminablt
OF in,erminxble, like those Of England, Q,
paid Our Coneressmen and 6nancierl
have usually acted on the principle
That optaons cost nothing. This is an error
It would be Bearer true to say they cost
great deal. Every option which the gor
eznment retains over bond, whether K
tax IT, pay it, reduce its rate Of interest. O,
~hat not, is an encumbrance On its sale. and
by lowering the. price it will bring
1nises the rate Of interest the government
pays On the actual value it borrowB~ Tb
advantages OF Al annuity ore1 a bono
, therefore, are tvo-fold, both tending to il
crease The creditors control over his secur
ty, and, therefore, to lower the rate of il
terest on which he will lend on it, viz
j. The government, having once borrowe
in this form, will never need to borrow u
same value sgain. The annuitant, OF len
er, il secure, therefore, against the cont
nal competition Of new securities sn
sequently issued, and whose consta
issue and reissue On tho market tend to d
tutb, clog, and weaken it, and always
lower his security. Great Britain will iss'
no new consuls except in the event th
new wars oblige j. to increase its det
But VIC, with our s, 10, 20, 3o-year bono
will alwsys be on the market, deprcssi
the prlce OF old securities by trying
borrow again.
9 The government has abandoned
control over an annuity, ind has no ria
save to buy it in open uarkes,-a rie
which the hu1nblest citizen enjoys. II
enhances its material sa1ue to the lend
and, therefore, reduces the rate at VII
he viii lend upon it.
For these REASONS the English con