The Charleston daily news. [volume] (Charleston, S.C.) 1865-1873, 1871-03-04
The Sterling Debt Bill.

The Sterling Debt Bill.
The Bill to create Sterling Funded Debt,
now before the General Assembly, is, in our
opinion, one of the most important meas
ures ever brought under the consideration of
the lawmakers of the State. Tt provides
for&the borrowing OF one million two hum
dred thousand pounds sterling, "to be used
Exclusively exchange for, or in payment
ssof, the existing public debt Of the State"
There are other provisions looking to care
ful and honest application Of the proceeds OF
the Sterling Funded Debt bonds; but the
stipulation which strikes US most forcibly is
contained in Section 8, which reads as fol-
lows:
SECTION 8. The honor and credit Of this State
is also hereby pledged to the holders OF the
debt authorized by this act, that this State will
nothereafter, until said debt ls-fully paid and
discharged, create any new debt or obligation,
or by the loan of its credit, by guarantee, en-
dorsement, or otherwise, except for the pur-
poses Of meeting its existing obligations, or
in and for the ordinary and current business
Of the State, without arst submitting the ques-
ton as to the creation of Iny such new debt,
guarantee, endorsement OF loan of Its credit,
to the people Of this State, at general State
election, and, unless two-thirds OF the quail
fed voters of the State, voting on this ques-
ton, shall be in favor of a further debt, guar
antee, endorsement or loan Of Its credit, none
such shall be created or made.
It is well known that the State Of South
Carolina is fully able, with sound financial
management, to meet the interest on the
public debt, and, in slime, to pay of the
principal Yet the State credit is bad, and
the bonds of South Carolina have fallen to
price at which they give return Of ten per
cent. year, in gold, upon the money act
ually invested. The amount Of our debt, OF
which we have knowledge is not excessive;
the power Of the people to meet their en-
gagements is not in question. All this is
frankly conceded by both brokers and per-
manent investors. Why, then, is the State
credit at so low an iebb? The answer is,
that it is feared that the present Radical
administration will so increase the debt, by
extravaganza and by lending the State
credit to bankrupt corporations, that South
Carolina might, before many years, become
incapable Of meeting her engagements,
however desirous the people were of
keeping unsullTed their financial reputation.
This is the whole trouble. What we need,
to establish the State credit upon firm
basis, is binding and irrevocable agree
ment that the public debt shall not in any
way, be added to- or increased.
We admit that the Sterling Funding Bill
is not without flaw. A large confidence,
for, instance, is s-reposed in tue Financial
Agent who shall reside in London. But it
is indispensable tothe successful negotiation
OF the loan that this Agent should be above
suspicion, aud this intlines us TO. believe
that the new bonds will, as promised, be
placed in the hands OF a Banking firm whom
this people, and the general public, will
cheerfuly trust And We are free to say
that if the Bill were, in other respects, far
more open to cavil than it is, we should |
support the Bill, aud urge its passage, for the
one reason that it closes the door upon all I
swindling loans and endorsements, and
makes it impossible, without the formality
of a two-thirds popular vote, to add to the
liabilities of the State
The eighth Section, being recited in the
story OF the Bonds, creates contract with
their holders which the courts OF the United
States would unhesitatingly sustain 1t
prohibits any new debt, any loan of the
State credit, until tte ecisti,ag debts fully
paid.
We believe that the General Assembly |
will do the State good service by passing, |