The Orangeburg news. [volume] (Orangeburg, S.C.) 1867-1875, 1873-10-21

terest. which htd been accumulutng for six
years. Tho State then made cOmpromiso
with her boudhoders, in which she agreed 70
transfer her title to tho Wabash and Erie
Canal in liquidation OF onc.half Of her debt
and to issue certificates of stock, bearing five
per cent interest after 1854, for the other halt
The Legislature solemnly pledged Tue taiths
aud funds OF tho State for tho punctual pay
ment of the interest aud principal; and
afterwards solemuly set apart all the revenues
of the State derived from taxation for general
State purposes, after the dcfraying of the
ordinary expenses OF the government TO the
payment OF the interest and liquidation of
tho principal Of the debt This compromise
and contract was afterwards confirmed by the
people at the ratification of tic New Con-
stitution of lS50.n
Even the old creditors of the State who
were not directly interested in these schemes
and held none of these questionable bonds
came forward tetihRyiy TO relieve the State of
the foul stain OF reputation, ana made
sacrifices OF their pecuniary interests which
made the compromise possible.
Aud now, by the faithful performance of
the terms OF this compromise, her credit hus
been completely restored, and stands upon
perfectly secure basis and without opprcS-
sive taxation her debt is being very rapidly
eNtingnshed.
Tie history Of tic tuances of the State of
Michigan furnishes another illustration of
compromise effected between State aud her
creditors Tho compromise made by the
State OF Indiana was made mt the suggestion
OF the hondholders and with their hearty
assent and cooperation; that of the State Of
Michigan was made without agreement,
which the bondholder was obliged TO acccpt
or get nothing. Her financial troubles began
in $40. The fovcr for issuing bonds to
build railroads and canals ragged mt that time
as IN epidemic throughout tile entire West.
Like II prairie fire or swarm of the dreaded
caterpillar passing over Il cotton plantation in
the South, its appearance was us sudden, its
march us rapid, its dosolaton rs complete
In 1897 and lS3S Michigan issued S5,200,-
600 TO build canals and railroads. The Gov
ernor made arrangements with 3 banking
company To net as the agents OF liIe State in
the negotiation OF the bonds The company
negotiated a portion of them and made the
proper returns 10 the state; tic moneys were
payable i'll iaslallments. The State was enti-
tied to receive about $2,s57, ,O391G on the
remainder OF bonds in hands OF the company
when suddenly it collapsed, and it was dis
covered thnt the whole amount of bonds had
beon hypothecated or sold. had passed into
| the hands Of Innocent ,:arties and were ont
| standing as n charge against the State The
Governor publicly called upon tho holders Of
the bonds either to pay the balance due upon
them by the company ar surrender them and
have the amount they paid for them refunded
The Legislature OF lS4l confirmed the action
OF the Governor and again demanded the sur.
render of the bonds upon the terms before
mentioned. y portion of the entire sum OF
| $5,2G00O0, amounting To Sl3S7.000, were
not included in the demand for the reason
previously given.
| The bondholders refused to accept the com.
promise and no further action was taken until
1916 At that time (Marc.I, 1866 the State
sold her railroads and received as part pay
| priuuipaI at Une rate OF $I03SS per s COO in
bonds, az the interest at the rate OF six per
| cent on :jO2f3 for each 81 900 of said bon,is
In 1855 the Legislature directed the trea-
surcr 10 notify the holders of said bonds, by
| public advertisement, TO surrender their bonds
within six months, MS after that time no in
! ter 81 would br paid. Tie six months expired
August, 1859, and from that Time the bonds
lave been adjusted nj the rate of $57S.57 for
each $1,000. There are still outstanding
$4,000, adjustable at So ,242.7s.
| Under the operation Of wise legislation
ample provision having been made for the
! payment OF uic interest and exlinguishment
OF the principal, by solemuly setting apart n
| portion OF the annual reyenus aud the levying
OF specific annual tax for that purpose tho
credit OF the State has been completely rc.
!
and annually increasing while the debt is
small, taxation light, and no occasion To make
1t oppressive. Tho auditor-gcncral in his re.
| port OF September, 1871. states that the sink.
| ing iund was large enough to furnish The
means 0I redecming all the bonds outstanding
before their maturity, il the holders could 10
| induced To surrender them, and the Governor,
| therefore, recommends tic repeal of tho act
levyng specific tax for tnat purpose.
The history o. the finances of the State Of
! Illinois is worthy of especial notice in this
connection. as in several respects she passed
through a similar experience 10 our own. The
success which rewarded that band of patriots
| who combined to restore the credit of the
State, and to lift the cloud of suspicion Of re-
! pudialon which rested heavily upon her,
might well furnish lesson TO the citizens of
this State who have her best interest at heart
The financial troubles OF Illinois occurred
| prior to the adoption of the constitution of
lS4s. Size had neglected for long time to
pay the interest upon her debt until the prin-
| clpal and It's interest accunulations amounted
to Tho enormous sum $50 considered at that
time) Of SlS000,000. Party leaders i'm
pcnched the validity Of the debt, and recon-.
| mcnded that the people refuse To provide for
It's payment, while the tax payers relieved
from taxation for one purpose, vigorously OPP
| posed paying any taxes at all. The distress
ing condition of the iinanccs is illly PORTRAYED
IN the report of the auditor OF the State of
| December, 1870. Said lie "To those who
can remember the condition OF the State OF
ILLINOIS, Ill lS47, the treasury empty, the Gov.
ernor borrowing money upon his own credit
to pay The postage on the letters written
on the business of the State, her bankruptcy
known aud sneercd ut all over tho world,
| nDnpgtV N IaI "A