The Charleston daily news. [volume] (Charleston, S.C.) 1865-1873, 1871-05-12

which IL Is to be used will be stated. 1t a to be
deposited In the Bank Of the State OF South Caro-.
lima, as SO much capital. to be employed by that
bank, acting as the fiscal agent OF the State IN ae;
completing the objects OF the loan, viz to aid
the citizens of Charleston to rebuild their city.
Upon the faith of these representations and
pledges Of the legislative enactments referred
to, Messrs. Barring Brothers & Co. became
the purchasers OF the larger portion Ct the
bonds, and through their influence most of the
balance was negotiated, on most favorable
terms to the State, ! Laiuk, at 90 per cent,
and at the low rate OF 5 per cent. interest, be-
cause of the peculiar nature of the security,
having not only the honor and faith Of the
State, which had always met its engagements
promptly, but had also the capital and profits
of the bank to fall back upon, and the further
power of legal remedy in the courts in case
Of default Of payment, which remedy could not
be resorted to against a sovereign State.
The bank, therefore, became not onlv the
debtor of the holder OF these bonds, oct was
agent for the State and trustee for the credit
ors. The proceeds of these loans wereslent
out by the bank as contemplated by the stat
ute. Charleston was rebuilt and the loans
made long since returned TO the bank, with
large profit TO the State on the transaction,
interest charged by the bank being much
greater than the interest paid by it to the
English capitalists 500 matured rs was
paid by the bank in 1853, leaving outstanding
slO9, 900; in round numbers, about s545, 900 in
gold, which became payable July l, 1867.
Tbp TatrJS1a 0f
unable to pay these obligations promptly, did
honestly propose to devote the assets of the
bank to the payment of these bonds and the
outstanding circulation, giving the preference
to the bonds, under the pledges made by Mr.
McDu1ie, and the statute under which lie ne
gotated the loan. But the present admins
tration initiated policy which has led to ex-
pensive and troublesome litigation, and this
loan left unpaid and virtually repudlated for
five years, although the Messrs. Barring Of
fered to renew the bonds on the same liberal
terms which had been extended to the State
of Massachusetts in London, provided the
securities originally pledged should be devoted
in good faith to the Indebtedness. Another
issue of this fire loan, made about the same
time; in the United States, under the same
statute, and for the same purpose, amounting
to s3ls, 900, and advertised to be paid 10 gold
January l, 1871, was repudated also, although
the fiscal agent, Mr.. Kimpton, gave notice,
by public advertisement, in New York, Colum-
bia and Charleston, that principal and Interest
would be paid on that day.
r. .r,o tIot Ioo,ol r,1 outionc hnva oritan
between various creditors OF the Bank Of the
State as to priority of loans. But this litiga-
ton seems to be the only resource of tho cred
itors as long as the authorities of the State
continue to repudiate the Indebtedness Of the
State; for in all issues now pending against the
assets OF the bank the State is bound, iii good
faith, to pay the litigants, because the State is
liable for the deficiency of the bank tc make
good It's obligation.
The want of financial skill is as evident as
the reputation of these debts are glarlng and
dishonest. How can State hope to negotiate
loans when defaulllng in payments already
due, and attempting also to deprive the credl.
tor of securities, pledged In good faith, to OBJ
tain the loan?
While these legislators were repuGiatlng
their contracts with the Messrs. Barring, and
refusing to make any provision for tie pay
| ment OF their fire loan bonds, due FIVE years
since, and even passing laws to deprive them
of the assets of the bank pledged for ..he se-
curity of these bonds-in spirit of extraor-
Linary liberality with the taxpayers money.
they were passing laws to increase the bur
dens of The people by the payment OF interest
on the bonds in gold, which bonds they had
largely purchased at great depreciation, and
by investing $3.50, 1000 In land to be distributed
among their iayorites; and all this time they
kept an agent in New York, borrowing
the money on call, and hypothecating the
bonds of the State in the widest manner,
and endorsing the bonds Of railroads to an al
most INDEFINITE extent, 80 that leading men,
bers of the Senate openly avowed their in
ability to compute tile actual Indebtedness Of
the State, as have already quoted 10 you.
Are you surprised that the credit OF the State
should have fallen so low? Reputation Is al
ways crime which never falls to bring lasting
and severe punishment home to the perpetra-
tors. An individual or State may become so
reduced by misfortune or bad management as
10 be unable to meet obligations, but no indi'
vidual or State has ever profted BY an exercise
of bad faith, no matter how ingenious the ar
guments used in justification.
have seen the Governor of q State almost
repused from bankers Office when applying
for loan, with United States bonds as
security. because his State having repudiated
some territorial issues Of bonds. The banker
refused TO hold intercourse with him officially.
South Carolina has been terribly mpoTerisll-
ed BY the war, and her sons insullcd and
| robbed by these adventurers which have been
forced upon her: but the honor of the State is
in the custody of her sons, and will suffer no
diminulion al their hands.
We have everything here buta good govern
ment and active capital. Our people are in
teiligent, industrious, and honest; our soil is
productive and cur climate genial. Con:rover-
sizes like this, if conducted with conservative
| decision, will gradually enlist large numbers
out OF The ranks OF the party which have been
acting against us. I am confident that the
conservative element Of that party are
ashamed Of their company, and are too .Ameri-
can at heart 10 sustain he practices and meas
ures we complain OF. Capital will flow N
unon ls when we can demonstrate the safety