The New York herald., 1873-12-23
A TEMPORARY LOAN TEE REMEDY.
IpstRity OF the Arguments as 10 the
Balance Of Trade.
IMPOSSIBaITY OF SPECIE PAYMENTS
Advantages to the People from
Three-Sixty-F Five Conrertibles.
THE JUp G E'S BILL.

WASHINGTON, Dec. 21, 1873.
The adjournment OF Congress and the scattering
Of the members tother distant homes Will give
then constituents opportunity to Freely express
opinions as to what should be done to relieve the
country in it's financial embarrassment. 1t is gen.
orally believed by those Interested In increasing
the volume of the currency that the sentiment VIII
be against taxation OF any kind restricting, so lar
a. the popular will can retrenchment in the expen-
ditures OF the government and greater supply Of
RreenbacRs for the business in vests OF the coun-
Hy. The members remanr Washington win
not lack for information. Alre the mails are
hardened with letters from y IN al conditions
Of life, earnestly protesting eAinst a restoration
OF the tax on tea and cofee, or increased tax
whiskey and tobacco. Such legislation, while
pronounced unpopular, would certainly weaken
the republican party and increase the
possibility OF the democracy gaining ! e
ascendency. With the return OF Congress,
win come hordes OF lobbyists, represent
ang every phase OF business. The bankers
will be here to prevent If possible, interference
with the present financial regime; while the dis
1iNers and tobacco manufacturers, divided In
opinion, will worry the Committee Of Ways and
Means with their pet notions. So far as the House
ana Senate have been canvassed the proposition
OF Mr. Keley, of Pennsylvania, has been favoraby
endorsed and the opinion OF both members OF the
Committee OF Ways and Means, Banking and Cur
rency and Finance is that it will eventually be the
compromise presented. Knowing the pertinacty
with which its author would press it, and the ma
jority, at least of the House. TO sustain him when
It comes before that body, your correspondent
called upon the Pennsylvania Representative this
evening for the purpose OF getting his views, and
the line of argument he win adopt when the sub
ject is presented Tor debate.
JUDGE KELLEY INTERVIEWED.
Having talked over the matter OF retrenchment
and how difficult it would be to satisfy the people,
who were clamoring for relief, ] asked
do you think we can do without any additional
taxation 9''
Judge KELLEY think the suggestion by the
Secretary Of the Treasury that taxes should be
Increased at time OF great depression like this
was serious mistake, and that he VIII discover
that the paralysis OF business Will be so brief as
not materially to aflect the revenue for this fiscal
year, certainly not to the extent OF the ordinary
surplus above the actual demands OF the govern
ment The falling of will be confined chiefly to
this quarter OF the fiscal year, and i think it is
highly probable that the loss VIII be more than
made up during the third and fourth quarters Of
the year, as the people will supply their wants as
soon as business shall revive and our laporing peo-
PIE shall be generally employed. The farmers and
working people OF the country are already loudly
protesting against the restoration OF the
DUTIES ON TEA AND COFFEE,
and TO increase the tax on whiskey and tobacco,
which seem to be regarded as proper subjects tax
alton, and which would lead 10 a most unwnolsome
specuton and TO general revival OF the frauds that
formerly prevailed with reference to both OF these
articles. The country does not appreciate the ex-
tent TO which the taxes on spirits and tobacco
afect the producing and working classes. Spirits
the products OF the grain fields OF the country
condensed to relieve the farmer Of from 20 to
75 per cent OF the cost OF transportation to the
Beaboard and tobacco Is one OF our most important
staple productions. Every reduction we have
made IN the tax either has increased its produc-
ti0n, and as the laboring people are the principal
consumers OF tobacco, whatever enhances Its
price reduces their wages. 1t is curious fact
that the existing tax on spirits adds from Is cents
to % cents to the cost OF producing an ounce
Of cuinine and this tax is felt in the price
Of every chemical production and article
ofperfumery in which alcohol is used as an in
gredient solvent. How largely this is the case
few people would believe. ] am therefore opposed
TO any modification OF these taxes until shall be
prepared, as hope we may in the near future, to
reduce them But, II am mistaken in supposing
that the revenues OF this year win be adequate for
the necessities OF the Treasury, hold as my reso-
luton now pending before the House expresses,
that the necessities OF the Treasury should be sup
Piled by
TEMPORARY LOANS.
Indeed, we should never, SO long as our paper
money is inconvertible, be without temporary
loans. They constitute an essential element in the
financial system we inaugurated with the issue OF
inconvertibe currency, and would not | think,
have ever been abandoned had Mr..
Chase remained at the head OF the Treas
nry. In my judgment, the present crisis, which
is costing the people OF this country at least
$1,000 600, 900 in loss OF wages and occasionng the
reduced prices at which we are selling our grain,
cotton tobacco and other crops, and in the shrink
age Of values in merchandise and the stocks OF the
most substantial and productive companies and
institutions in the country, is largely due to the
fact that our own bankers and foreign dealers In
credit have begnied us into eliminating from our
financial system temporary loans in which surplus
greenbacks might be invested. have, therefore,
a. you are aware, introduced bill providing for
the Issue OF bonds bearing SO 65 currency interest,
And redeemable on presentation in greenbacks, to
be known as
NrER-ooSvERTIBLE BONDS.
novelty in our legislation though the idea has been
boating through the community for some time
Judge KELLEY-I assure you, sir. that IL Is not
novelty, Is in no sense experiment. but was
part OF our uniform practice down TO the time that
the Treasury officials seem 70 have allen into the
hands Of the credit mongers OF the world In 1852
came from Philadelphia to Washington with a
German gentleman for the purpose OF introducing
him TO Mr.. Chase that he might oner, on behalf of
what we wogd now call a syndicate OF German
bankers, loan OF s4G0, 100000 Mr. Chase heard
him, respectfully received ais paper and said to
hun 81 will send you my reply to the hotel in the
course OF ifalr an hour" And ia less than that
fime the reply came, saying that 1--WE decline TO
entertain any proposition from abEoad at this
time, relying upon the ability OF our people
90 turnisn us with the required funds"
am not sure that / give his answer YER
Dausn, but am absolutely certain that there is no
departure from its spirit and intent That was
about the midsummer OF 1862 but we had ALREADY,
~ tae act OF July IL, 1862 authorizing an at-
dltona issue OF $15o,000,0 600 OF legal tender
nctes-s 900 OF which might be in demo nina.
lions A Ess tnan s5-provIded Tor the preparation OF
SoO,oOO,OO0 IN Rreenbacks, not to be issued for
general circulation, bnt to be reserved to pay tenn
porary iohns promptly In OF emergency,
nave said that attribute this crisis to
THE ELIMINATION OF TEMPORARY LOANS
rom our financial system, and now add that by
nd