The Manitowoc pilot. [volume] (Manitowoc, Wis.) 1859-1932, 1871-09-14
Mr.. BOutWeil's Violation Of the Law.

1T has become so common for the off
Gals of the present Administration, fol-
lowing the example OF their chief, to dis
regard the laws, that one instance more or
less OF illegal action on theil part seems
hardly worth noticing. When, however,
a gentleman of Secretary Boutwell's past
reputation, succumbing to the spirit of de-
mOra.iz2tiOn which surrounds him, palpa-
bly, violates statute passed at his own
solicitation, and drawn, it may be suppos-
&c, just as he wanted it drawn, the case is
a pretty serious one.
The Funding act of July IA, 1870. as
amended last January, embOdies, it is well
known, Mr.. BouJwell's pet scheme for re-
ducing the rate of interest on the national
debt. It's first section authorizes the issue
OF S5OU,U00,0UO of bonds bearing five per
cent. interest per annum, $3OU,t % coo bear.
ing AZ per cent. interest, and 800, 900 600
beariL & four per c. Mt. interest. The second
section then enacts:
THE Secretary of the Treasury is hereby au-
thorized to sell and dispose of any of the bonds
issued under this act al not less aE eirUqy rakae
jar com, and to apply the proceeds thereof to the
redemption of any of the bonds of the United
States outstanding, and known a. five twenty
ponds, at their pac value; or IL may eCctgHgs the
the bonds hereby authorized shall be used for no
other purpose whatever; and a sum not erceedlnq
CHe-hGtt u OLe pr CtHtUm of the bonds herein
authorized Is hereby appropriated TO pay the ex-
pense OF preparing, Issuing, and disposing OF the
same
In respect to the first S7O,OO0,O0O of the
$5UO,OC0,OO0 five per cent. bonds author
lzed by the act, the Secretary observed the
limitation OF expense fixed, and sold them
at par in gold, allowing one half Of one
per cent on the amount to his agents for
their commissions and the cost of adver-
Using. To dispose of these few bonds oc-
cupled, however, nearly five months time,
and the prospect for further sales looked
very unpromising. Then the Secretary re,
solved TO at least get rid Of enough more
TO make up S200,000,000 of five per cents,
cost what it might. The A x and four per
cents were evidently hopeless Job; but
the failure, he thought, would be some.
what covered up by the success of the
i've per cents. Consequently he sent al
agent to Europe, and there, by the offer of
extraordinary compensation, ne induced
Clique, or syndicate, as the phrase is, OF
stock jobbers TO take a portion of the
1870 GOO, 600 remaining of the 100000 900
offered, while another portion he coaxed
and threatened the national banks of this
country into accepting. But to accom-
phsh this resulth he has practically enlarr.d
the cost OF the transaction from the pre-
scrlbed one-half OF one per cent. to nearly
TWO per cent, and has thus expended, in
stead Of $65O,UO0 allowed by law, So, 60O,-
O0O-or an excess of nearly So ,OO0,OUO.
The method by which the expenditure
OF S2,O00O00 has been attemp ed to be
covered up is ingenious, but Intellectual
the act il will be observed, requires that
the bonds be (l( sold at par in gold, or (2)
exchanged at par for five twenties. The
Secretary has apparently done both of
these things, but in reality he has done
neither. Nominally lie has sold some of
MS bonds at par, and is going to exchange
others for hVe-twenties at par. In reality
he has sold some at % in gold, and is to
exchange others for tive-tsenties at a dis.
count OF two per cent. He has done this
10y accepting subscriptions tor the new
bonds from present holders of the five
taeptes, anu then agreeing TO allow them
to draw both interest on these bonds and
interest on the tive-tWenties for the space
OF three months, III addition to a commits
sion OF one half p cent Interest at six
per cent. TOR three months is one and one
half per cent and this added to the one
half per cent. makes the two per cent.
which it has really cost the Secretary to
market the S130,0O0,000 Of his five per
cent. bonds.
1t remains to be seen whether the Ad-
mlnistratiOn orators and writers will glo-
rlty this transaction as triumph of
financial skill. 1t would not be surprising
IT they did. Men who can support the
President in his illegal use of the navy in
San Domingo, in his retention of military
officers about his person to civil capacities,
IN his appointment Of collectors Of in,
ternal revenue for districts in which they
do not resice as the law requires, in MS
repetition Of the census CT New York and
Philadelphia, and in his employment of
the national troops for the furtherance If
ais private political schemes, will not be
likely to finch when so small thing as
the expenditure of S2,000,tO0 is in ques-
tion.-Neao York Sun