Memphis daily appeal. [volume] (Memphis, Tenn.) 1847-1886, 1870-03-01
THE CITY DEBT.
A Plan for its Liquidation, by an Exps-
rienced Business Man.


city's obligations to pay, and how TO pay
them within the next thirty years-pro-
vided no other debts shall be contracted 7;
and provided further. that all succeeding
administrations shall pursue the same
line Of policy marked out by the present.
There are insurmountable difficulties in
the way Of the theory presented. The
city debt is too large TO be hquidated by
such q process, and carry on ut n same
time such improvements as must be done
if Memphis is TO increase her population
The public debt must be paid upon terms
Just and fair 10 all conference.-the the tax
/ payer as well as the creditor. To do this,
the debt must be reduced to a fair stand
ard Of value upon a cash basis. The debt
of the United states will have been re-
duced one half, practically, when three
and q half per cent. bonds are substituted
| for sey~en-tbirties; and this will be done,
or Reputation Will follow. British con-
soils grew oct of a similar state of things,
/ and the whole world saw the wisdom OF
the measure, and the creditors were salts
fed. Creditors are holding their claims
against the city at a cost of about forty
cents to the dollar, upon an average
many at a cost of thirty, and some Of them
at twenty cents on the dollar, IN green
backs. It is fair and just to them to esti-
mate the citv credit 90 be worth fifty cents
! on the dollar, in cash. This was the Gpin-
ion of our best ~nnanciers al citizens two
wears ago, when our debt Vas nearly two
millions less han at the present time, and
they tried TO pursuade the authorities
then, as now 10 instruct the tax-collector
to receive hfIy,cents In cash, on past-due
/ Indebtedness al par, for all taxes. It was
also a part of the same policy TO fund as
fast as possible the floating debt by issu-
ing new bonds at par. This was being
done TO some extent when the ruinOus
measure that followed interrupted the ex-
change Of bonds for scrip, and thereby
sunk from one to two millions of dollars
to the city.
All sensible men saw this bad policy at
the time, and demonstrated with the au-
thorities. bUU to no purpose. Our enor-
nous debt will nOt-cdHHOt-be canceledin
the manner proposed by the Comptroller's
report. 1t is the interest of creditors, as
well as taxpayers, to inaugurate some
practical nod OF settlement.
Let the city receive cash at 80 cents on
the dollar. or any past-due Indebtedness
at par, for all kinds of taxes and privi-
leges. Make no distinction, and none
will feel aggrievsd. In no other way can
so large S portion of the revenue be col
Iected, and the publicdebt be so easily alb
sorbed. Reduce all expenses to a cash
basis, and pay cash for everything. Let
the Tax-COllector commence receiving on
this basis, and when bonds and the past
Aak = - AlA4AAA1 1911 ~ AAA III H-@@~ -
they soon will, the remainder can be
funded at par, or nearly so. Let the tax
payers have the same privilege extended
70 brokers and it Will not be their interest
to buy SCRIP, but to pay the money into
the city treasury, Two years ago city
bonds were worth p per cent. more than
scrip-the latter having been ISSUED to
creditors at 80 to IS cents to the dollar, or
three dollars TO pay one. This was the
condition of things when the preceding
administration came into owe and when
the ruinOus measure above referred to
was adopted by the Board against the pro-
tests of all taxpayers. A few individuals
were permitted to fund scrip, which they
had purchased at 30 cents, for bonds, the
city taking the scrip at par. and giving
bonds at % cents to the dollar.
II will be seen by this arrangement that
most Of the past-due debt mas cost the
holders from Is to 20 cents to the dollar,
in ~greenbacks, when currency was 40 per
cent. discount, and that the city Is paying
80 per cent. interest N The net proceeds of
the bonds. And stiu worse, the city part
ed with her scrip, which paid no interest,
and gave bonds for four and a half times
the amount, which are drawing interest.
This policy was called raising the city's
credit" 1t j. true hat scrip Wss and is
still raised 80 cents on the dollar above
its legitimate value, but the credit of the
city is worse than il was then. The accU-
mulated debt and the price OF bonds prove
this fact.
The financial policy which was urged
upon the Board two years 2 shOuld be
adopted now twill subject the outstand-
ingindebtedness 10 practical management.
Let Us all pay cash at 50 or scrip at 100
cents for all taxes and privileges, and
when scrip reaches tins pointer
its true cash value-it can easily
be funded. There is no injustice
in this-nO "repudia i'm"
Every creditor will get his just dues-his
money invested with twenty per cent. in
terest
1t is a subject of public reproach that as
soon as an individual is elevated to a pO-
sitiOn in the city government he loses all
sympathy for the taxpayer and the IL
ceused business man. No undue reflec-
ton upon the present Board is intended,
for such has been the case from time inn
memorial in "a city Of Memphis. In
order 10 secure large sums for city pur-
poses the property is assessed at about
four times as high as the average value
throughout the State, and our taX-ridden
people are forced TO pay n quadTuple
share of the State and county eVenue. Of
course their rate per g floats over our
own valuation, and while they assess at
One-fuurth and we at full value Of property
we are made Is pay four times as much
tax as the balance of the state IN proper
ton 10 our wealth. The Constitution
provides that taxes "shall be equal
throughout the State" but this has
always been d~isregarded in Memphis. 1
have no complaint 20 make Of equal taxa
ton for legitimate purposes, though it
may sometimes be oppressive, but II is an
outrage on hUHGR rights to pursue such
robbery further or longer. But it Is an
swered that revenue must be raised, and
how can it be done upon the low valua-
ton of other portions Of h State. Simply
by raising or lowering The rate per cent.
to meet the public necessities. II. by in
~vestigatiOn, II is found that the aggregate
property of the state is assessed at one
fourth or One-third Of its cash value, let
ours be assessed in the same way, and
increase the rate per cent. 70 raise the
sum required. This is the only way TO
stop this gross injustice to oUr people and
at the same time contribute IA fun share
Of revenue to the State and county. Will
our citv government correct this long
endured and crying injusticeG The pres
ent Board share, in a large degree, the
public confidence, and it is but just tOsay
that none Of its predecessors contained
more Intslligence and honesty. Grave err
rors, however, may be committed, and
since the wretched mismanagement of the
past two years, and by men In whom
great confidence was repOsed, il is not
strange that some apprehension should
be felt for the future welfare Of the city.
LYCURGUS.