The Evansville journal. [volume] (Evansville, Ind.) 1866-1870, 1870-09-01
80 - oRa.
SPEECH OF
GOVERNOR CONRAD BAKER,
Delivered at Indianap Ills, Saturday
Evening, August %, 1870.


Fellow Citizens:
The past and present indebtedne -
of the State being matters of public
record, open to the inspection of all.
may be misrepresented. but need not
be misunderstood by any one DESTROYS
of knowing the truth.
l propose IN what | shall say on
this subject on the present occasion, to
either quote literally from The record,
or at least to refer to book and page
for the verihcation of every state
ment.
ORIGIN OF STATE DEBT.
lie Is a matter of history that, In
diana in 1886. under the Influence OF
the internal Improvement mania which
then afflicted her people, embarked
10 the construction of a vast system OF
public works which soon proved to
be largely beyond her ability to COM
plete.
By single act il 1886, she author
iZsd the borrowing of $40. 0OQ. 900, for
which the faith of the State was
pledged. The bends issued under this
act, are known as : Internal Improve
naeRt Eonds: and although there
were other bonds Of prior issues out
standing at the time of the adjust
ment of the State debt in l847, !
shall, to avoid DISQUALIFICATION, desig-
nate all the bonds issued prior to
1847 as Internal Improvement
Bonds"
10 1841, the State ceased to provide
for the payment of the interest on
her outstanding bonds, and no at
tempt was made to resume the pay
ment of the interest on any portion OF
her bonded debt until after the I'D
justment of 1847. When the State
suspended payment of the interest 10
1841, her entire taxable property. real
and personal, was less than 500 900.
OOO, and her outstanding liabilities,
foreign and domestic. were about
S12.000.000. In ether words, the
State owed an amount equal to about
one eighth of all the taxable property
Of her entire people.
In 1S45, the taxable property of the
State had increased to $I22, 600, 900;
and. at the meeting Of the General
Assembly in December of that year
Charles Butler, Esq. of New York
on behalf of large number OF the
foreign creditors of the State, pro
posed that the public debt of the
State should be adjusted in such
manner. aud upon such terms as
would render it possible for her to re
sumo the payment OF interest on such
portion of the debt as should by the
terms of the arrangement be charged
upon the revenues OF the State.
The result of many conferences be-
tween Mr.. Butler and the members
and appropriate committees of the
Leg Stature, was the passage of the
act of January 18th, 1916, entitled
An act to provide for the funded
debt of the State OF Indiana, and for
the completion OF the Wabash aud
Erie Canal to Evansville
This act was submitted soon after
its passage by MIR. Butler to a confer.
ence of large number of the foreign
creditors OF the State, held in Lon.
don, at which divers amendments
were suggested and prepared for pre-,
sentation to our General Assembly, al
its, then, next meeting, in December
1916.
Il
presented. and the result was the pas
sage of the supplementary act oil
January q, 1847, which, as l under.
stand the matter, largely consists ol
amendments prepared by the London
Conference, and hence the peculiari
ties Of this act when compared with
our ordinary forms of legislation.
These two acts taken together have
IL l..
as the Butler Bill.
This Butler Bill was at the time o!
it's passage only proposition, because
it In express terms provided that i
should cease, determine and be NIL
and void unless bonds of the State to
the amount of four million dollars,
exclusive of interest. should be sur
rendered for cancellation under the
provisions of the bill on or before the
first day of July. 1917. What shen
was, or is, the Butler Bill?" | an
swer in brief that it was a PROPOSE
ton made in the first place by a large
number of the creditors of the State
to the Legislature, aud adopted by il,
that, the creditors should take the
Wabash & Erie Canal aud some 800,
600 acres of land donated by Con
gress for its completion, for one half
of the principal of the bonded debt,
and also for one half Of the interest
accrued thereon; and, for the other
half, the State was to make provisions
by taxation.
The principal of Zach bond was to
be divided into two equal parts, and
for one of these halves or parts the
State was to issue-upon the surren
der of the old bonds-a new five per
cent. State bond, the interest being
payable semi annually, and the pTiu-
cipal being payable at the pleasure of
the State after the expiration OF TWEEN
ty years.
For the other half of the principal
of each bond surrendered q five per
cent. certificate of Canal Stock was to
issue, and the payment of the prinel-
pal and interest thereof, was 70 be ex-
clusively charged upon the Wabash
and Erie Canal.Its lands and revenues,
and for the payment OF Whice tbS
State was not to be liable. -.
The interest IN arrears IRON 1871
to 1877, on each bond surrendered was
TO be funded, and interest on the sg-
c---ate thus funded was 90 be calcl-
lated at the rate Of Two ADD a half
per cent. per annum from January l,
1847, to January 1, 1853. and added
70 such aggregate, and the sun thus
to be divided into equal parts, for one
of Which halves or parts, certificate
of State Stock was to issue. bearing
interest after January l, 1853, at the
rate of two aud half per cent. and
for the other half, a like Certificate
of Canal Stock, chargeable exclusively
upon said Canal, was to issue: -Four
millions OF the old bonds of the State
were surrendered under the Butler
Bill before the LIST day OF July, 1917;
and that bill thereupon became eff
feetual. If all the Internal Improve
ment Bonds had been surrendered,