Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1872-02-06
wHTrEwAsHTNG ROurwELL.

The Congressional Committee appointed
to investigate the alleged infraction of law
perpetrated by Secretary Boutwell, in re-
funding portion of the public debt have
submitted a whitewashing report to Con-
gress, and according to our dispatches from
the capital, that long suffering and merciful |
body have adoptedit. 1t was charged against
the Secretary, and admitted by him that he
had temporarily increased the public debt !
to the extent of slS5.OOO,OOO, in recalling
the fye-twenty bonds. He denied, how
ever, that this increase involved violation
Of the law, Notwithstanding the fact that il
specifically declares that s.nothing in this
act or in any other law now in force shall
be construed to authorize any increase
whatever Of the bonded debt of the United
States" The object of the law referred to
is to refund S1,5OO,OOOOOO of the public
debt by substituting new bonds bearing
low rate of interest for the old bonds. The
only practicable method of carrying out this
scheme is by selling the new bonds at piT,
and redeeming the old issue. Under the
provisions of the act, three months notice
must be given to holders Of old bonds be-
fore the interest on them can cease. 1t is
therefore impossible to avoid entirely tenn
pOrary increase of the public debt, as the
sale of the new bonds necessarily must pre-
cede the purchase of the old. 1t is evident
that the object of the law is to prevent a
protracted increase of the debt in the pro-
cess of refunding. The second section of
the act appropriates one-half of one per
cent. for the payment of the expenses of
printing bonds, ETC., and COM
mission to the agents employed to refund
ing the debt. On the S1,500OOO,OOO, this
per centage would give S7,5O0,0OO, which is
intended to cover all the cost Of re-funding.
! That is the maximum rate authorized by law,
and it is held to be the duty of the Secreta-
ry to see that the cost shall not be allowed
to come up to that maximum unless it be
reasonably necessary to secure its negotia-
ton. According to Mr.. Kerr, of Indiana,
who was member Of the investigating
committee, the following amounts were
actually paid for re-funding 5000, 100000
For negotiating the sale Of $50, us, $50,
the sum of S164, 438.S7fc, or one-quarter Of
one per cent; for negotiating $50,000,000,
the sum of So, 5OO,or one-eighth of one per
cent. The amount actually paid under the
contract with the Syndicate for negOtiat-
ing the sale of the remaining So, 224, $50
was $375, 0O,equalto nearly one-half ofone
! per cent on that amount. In other words
it cost more than half as much again to
fund eighty-four millions as it did to fund
nearly one hundred and sixteen millions.
For the former the amount paid was $780,
900; for the latter only 26,93S.S7k. How
all this came about is one Of the
mysteries of the Grant admins
tration. All attemps to fathom
it have proved unayailing, the Secretary
having declined to furnish any information
on the subject. But this high per centage
is q small item in the profits which the Syn
dictate have made as agents Of the govern
ment. Under their arrangement with Bout
well they were allowed to hold $1O0,000,0OO
for an average period of three months and
twelve days, and S20,OOO,0OO more for an
average period of over six months and
half, and nearly Sl2OO0,000 for seven
months. These sums were not held for
any uncertain period. The Secretary could
not call on the syndicate to pay them in at |
sight. This immense sum was, therefore, bear |
ing interest all the time it was in their hands.
They could not have realized less than two |
per cent, or about S2,50e,000 from their
contract. OF this amount the public have |
been swindled either through the completely |
of Boutwell, with the Syndicate, or through |
his incompetence to manage his department. |
In every way the people have been
victimized, and the law has been
broken. The public debt has
been needlessly increased; the very highest
rates permitted by law have been paid to
Jay, Cooke & Co., and others who form the
Syndicate for refunding portion Of the
debt, when there was, to all appearance no
necessity for such increased expense; in
violation of law the public money has been
loaned to the syndicate for protracted periods
and in such a way that it was not under
control of the government until the termi-
nation Of such periods, thus depriving the
public Of the interest arising on those
amounts. There is no evidence to show
that any Of the vast sum of money en-
trusted to the Syndicate was ever deposited
in any of the National banks. Where it
was kept or how it was employed by them
is a question which none but those
who shared in the dark transaction can an
swer. Two things are very evident: One,
that Secretary Boutwell, has largely exceed
ed his authority; the other, that his con-
tract with the Syndicate has entailed loss
of many millions Of dollars to the country.
The action of a majority Of the
committee in submitting a withdrawing
report to Congress, and Of that body in
adopting it will not deceive the public.
Many Independent Radical papers have con-
demned Boutwell's illegal proceedings, and
have openly denounced the action of the
committee. The dominant party are treas
uring up unto themselves "wrath against
the day Of wrath" when they will have to
stand before the public and render an ac-
count of the stewardship they have so
prostituted.
IN HIGH QUARTERS. I
1t appears that smuggling is not confined