Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1873-02-22

We have heretofore said that the fund
ing Of the State debt was not-a political is-
sue in the late canvass; that both candi-
dates for Governor and al parties concur
red in the necessity of this Legislature en-
acting law 10 fund this Indebtedness. We
have. also said sthe funding proposition has
nothing to do with New Issue nor Confed-
crate notes, warrants, bonds nor COUPONS
If there be any member of the Legislature
who fayors the funding Of any of these he
has not so far as our information extends
given utterance 10 his desire so to do"
We extract from an editorial in the Knox
vile Chronicle Of the 10th, the following:
As the term during which the present Leg
islature will sit draws to close, the peonie
of the State will look with intense interest
to the action of that body on the great
questions in which the State is SO vitality in
terested. Something must be done. Deep
disappointment will follow, If something IS
not done, and members of the Legislature
can not afford to brook such a public sentl-
ment as will follow as result of their fail
ure TO take action.
Craftsmanship and a regard for the good
opinion of the world, should prompt us to
take steps for putting the State right in the
matter Of her obligations. No interest has
been paid on our bonds for four years. We
are morally bound to either pay this, or to
give our creditors something 10 show for it.
We say in a moral point of view this is so.
= IF Or.inicTt
on this subject, but if funding bill apply
ing TO this, and this alone, were offered, we
do not believe there would be any serious
opposition to lis passage, and from our
knowledge of the taxpayers OF Tennessee,
they would endorse it. -
In the Nashville Bulletin Of the 10th we
find the following, communication from
Hon. A. A. Freeman, the Republican can
didate for Governor, at the last election
To the Editor Of the Bulletin: / have
been surprised since my arrival. in your
city to find that there is some diversity of
opinion among the members of the Legisla-
ture as to the propriety of funding the past
due debt and interest of the State. l do
not wish to be regarded as obtruding my
own views upon the legislature, but in
Justice TO myself and the patty whose prin-
cipies | had The honor to represent during
the late canvass, must be allowed to say,
that if there was any one question upon
which all parties democratic, Republican
and independently were more fully agreed
than upon any other, it was upon that pre-
serving the credit ofths State. And TO talk OF
preserving the credit and at the same time
to reflse to fund the matured overdue
debt. is to perpetuate glariDg absurdity.
But we are told that to fund the debt is to
compound the interest, and thereupon is
held up TO our view all the horrors of com
pound interest. / answer, inthe first plaza,
this is not true, and in the second place,
if it scere true, it would not alter the prin-
ciples involved. Interest, strictly speaking,
is penalty that the law imposes for
failure TO pay debt at its maturity, and
in ordinary commercial transactions It IS
merely appended TO and contingent upon
q failure to perform the contract. But 1t
is not so in matters pertaining to the State.
Our bonds are issued, and to them are az
fixed what we call coupons. represent
ing, what for want of a better name,
we call interest. Now Il esq coupons
are due and payable at certain
dates, just like ordinary promissory notes,
and when the coupons fall due we are IN
der just as much obligation to pay them as
the farmer is to pay his note executed for
corn or bacon, or the merchant his bill CIV
en- for dry goods. When we issued our
bonds we promised to pay these coupons as
they fell due, and to pay the bond Itself, at
its maturity. True, we did not promise to
pay interest on the coupon if we failed to
pay it when due, for the very good reason
that We pledged the honor, the credit, and
the good name of the State to pay the cott-
pom itself. So with outstanding treasury
warrants, these are sll evidences Of debt,
not interest, but debt due and unpaid.
And for us to say that We will neither
pay these outstanding and Overdue debts,
nor pay interest on them, nor even give our
promise to pay interest is not step in the
direction of repudistion-H is Reputation
| ttseif. II does not require an act OF the
Legislature to constitute Reputation. A
| failure to provide any means for meeting
| our past liabilities is OF itself reputation.
We cannot be compelled to pay our debt,
| and therefore to fail to provide any means
for so doing, is equivalent to direct refusal
| to pay. But / have been panied and sur
prised to hear the idea advanced that the
| State does not suffer any from deprecis'
ton Of its credit, and they suppose that if
| our Cebt of about twenty millions could be
| purchased for ten millions, that it would g
| ten millions saved to the people. Nothing
could be further from the truth. 1t has
been remarked by one of the best political
economists in the world that Hthe premium
which State pays on its debt is just equal
to the discount Of its securities in the
| markets OF the world" IL the present
debt were all that could be contracted
by the State-in other words, if the State
could exist in the future without any cred
it, the policy of repudiating, or discounting
our debt, might not be so ruinous, but to
talk of great State existing for any length
of time without credit, is an absurdity.
True, it is to be hoped that we will have no
more railroad combinations, but thousand
unforeseen contingencies will arise, neces-
sarily demanding and requiring that the
State pledge its credit. So, let the railroads
and turnpikes work out their Indebtedness
without aid or embarrassment from legisla-
ton, and in the meantime let the Legisla-
tuIe by ali means provide for meeting our
outstanding liabilities, l do not wish TO be
understood as abiding in any manner, or
under any circumstances, to that uumeasur-
ed and Unreasonable amount of spurious
and so-called indebtedness, known as the
Torbett issue, nor to any other debt or liza
bility in any manner incurred in aid of the
rebellion. If the Legislature now in ses-
sion will only fund our past due debt and
interest, and provide a good and efficient
system (State system, of common schools,
it will do what The people desire to have
done, and will earn the respect not only of
the people at home, but of those abroad.
Respectfully, A. a. FREEMAN.
NASHVILLE Feb ~ 1879 .H-a-a