Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1873-11-07
THE TREAsURER'S REPORT.

on internal revenue This decrease in reye-
nue. is mainly due to the great reduction of
taxation in both of these, the main sources of
the national income, that was made by the last
Congress, which was demanded by the people,
and has received their sanction and approval.
OF the course that should be pursued in the
future, either taxation mast be incressed-=an
expedient that can hardly be thought of--or
the appropriations must be kept largely below
the receipts; otherwise the rapid reduction of
the public debt will be arrested, if not aban-
doned. Treasurer Spinner slys few if any
believe the volume of the circulating medium,
as fixed by law, stands at an amount that is
exactly right 1t must be obvious to all who
have an interest in, and who have watched the
course of business and the financial returns of
the country. that there are times when the real
wants of the country demand, and there
should be, an increase of currency; and tina.
there are other times when the safety of all
legitimate business requires that it should be
largely diminished. What is really needed is
a currency so flexible as TO at all times accom-
modate itself to the business wants Of the
whole country. After arguing the question,
the Treasurer says that for the existing noto-
rious evils remedy should be found and
interposed. In looking over the whole
ground, no scheme has presented itself that
would be so likely to accomplish the END IN
view as the authorization by Congress Of the
issue of certain amount of egal- tender notes
that could at all times be converted into
currency interest bearing stock of the United
States, and for which the holder Of such stock,
SO authorized, could at any time receive legal
tender notes with the accrued interest from
the day Of issue of such stock TO the dag Of its
redemption It is believed that rate of 10
terest no higher than three and sixty-lve one
hundredths per cent. will be high enough to
absorb the desired amount of the circulation
when not needed for commercial purposes,
and low enough to force the return of the
bonds in exchange for legal-:ender notes at
the times when the business wants of the
country shall require more currency.
Ii is believed, with this new attribute OF the
| legal-tender notes, the parties who are now SO
clamorous for more paper currency will be-
come satisfied that no more is needed, and
that those who believe it is mischievously
redundant and hindrance of the resumption
of specie payments will have an opportunity
10 Judge of the correctness of their precon-
| ceived opinions. la addition to the urgent
| ecogomical reasons there are strong moral
ones why the legal-tender notes should again
| be made to be convertible into United States
stocks.
Banks were created for the purpose ofloan-
| ing money for the more easy transaction of
| business, and not for the purpose of borrow
| ing it for the purposes of speculation and thus
blocking the channels of legitimate trade and
commerce. So long as they confine them
selves to this, their legitimate business, they
benefit themselves and the community
well; but the moment they reverse the ma
chinery, and become borrowers instead of
lenders of money, they not only put their own
interests in peril, but become instruments of
great danger to every body within their in
huence. This practice on the part of national
banks of paying interest on deposits, and
| especially that Of one bank allowing interest
on the deposits of another, whether they be
permitted to hold the proposed bonds as part
of their reserves or not, should be forbidden
by law under the severe penalty of the for
fixture of their charters.
Objection will no doubt be made to the new
tender notes, on the ground that interest will
hav to be paid on that part of them which
will be represented by the proposed stock.
The minimum amount of legal tender notes
1856, 00O, O00-is now loan from the people
to the Government without interest. Should
the plan proposed be adopted, it is believed
that at times the part of these notes represent
ed by stocks would amount to $3.50, 900,
and that at other times it would not be more
than half that amount. This would bring the
average amount at interestto about SIP ,O0O,-
600. If the maximum of 10000, 900 au-
thorized by law should be issued, it would re-
duce the amount on the difference of interest
TO be paid by $44, 200, 900, being an average
of $68 ZOO, 900 on which interest would have
to be paid This at 8 g. 100 per cent. would
amount to So, 49,, 900 per annum. The whole
circulation issued by the Government, includ-
ing the fractional currency, would then be
about SAC, 900, on which the interest at
five per cent. would be $22 900 900. Deduct
ing the amount of currency interest that W ould
probably be paid on the contemplated new
bonds as aforesaid, it would still leave over
SIS, 800, 900 as the saving of gold interest by
reason of this large loan by the people to the
Government, on which the latter pays no in
terest. The apparent loss of less than So
| 500,0 900 in currency TO the people who would
hold the stock would be mere trfe as COM
pared with the great gain that would accrue
to the whole country in consequence of the
better circulating medium that would be in
troduced, and which it is believed would pro-
tect them in future from ''corners" of all
kinds, and from financial commissions like the
one that has just now swept over the country
like tornado. This could not have hap
pened had there been an elastic and flexible,
instead of our present rigid and unyielding
currency. There is scarce a doubt but this
financial revolution has cost the people in the
aggregate hundreds of millions of dollars, to
say nothing OF the loss of revenue to the Gov
| eminent.
There are, 10 doubt those who suppose it
| to be their interest TO have money matters re-
main as they how are; who prefer state OF
suspension and unsettled values to the re-
sumption OF specie payments, and fixed
standard for the measure of exehangeable
commodities, on the ground that a return to
specie payments would make money scarce
and thus produce great shrinkage in all val
ues These may dismiss their fears. An ir.
redeemable currency, fixed as to amount, rig
id ike oars, makes an uncertain measure of
commodities, while a circulating medium that
ia elastic with poId ia tha