The daily phoenix. [volume] (Columbia, S.C.) 1865-1878, 1873-10-22

Inslase Tho people realized their tvo con.
dtioli, but not before they hid boo,l burdci,G,l
viii. n del't Of $l4,000,000, besides. tho i,s
tcrsst which had been ncolmnlsting ior sin
years. Tile State then mude a cpn,proinis.
with her boudholders, in which slis, ugreed to
transfer her tito to tho Wabash Sand Eric
Canal in liquidation of one-hnlf Of hsr debt
und to issue certificates OF stock bearing five
por cent. interest after 1854, for the other half.
Tho Legislature solemnly pledged tho faith
aud funds of tho State for the punctt,ul pay.
ment of the interest aud principal; and
Afterwards so:ec,nly get apart all the revenues
OF the State derived from taxation for general
Slate purposes, after tho defrnying Of tho
ordinary Expenses OF the government, TO the
paymentbf tho interest and liquidation o
the principal of the debt. This compromise
and contract was afterwards confirmed by tho
people at the ratification OF tho s.Ncw Con-
stitntion Of 1850" Ela
Even tho old creditors OF the State VINO
were not directly interested in these schemes
aud held mono of. these questionable bonds
camo forward ac.!linyly to relieve the Stato of
the foul stain Of ropudinticn, and made
sacrifices of their pccuniary interests which
made tho compromise possible.
Aud now, hy tho faithful performance of
the terms of this Compromise, her credit has
been completely restored and stands upon n
perfectly secure bnsis; aud without opprcs-
sive taxation her debt is being very rapidly
extinguis,cd. :.
The history OF tho iiuances Of tho State of
Michigan furnishes another illustration of n
compromise effected between State and her
creditors. The cosrprcmise made by tile
State OF Indiana was nndo Mt tho suggestion
OF the bnndlioidcrs and with their hearty
assent and cooperation; that of tho S,nte of
Michigan WIS made without agreement,
which the bondholder was obliged to accept
or get nothing. tlcr financial troubles began
in l840. Tho fever Tor issuing bonds to
build railroads and canals ragged mt TINT time
0s all epidemic throughout tile entire West
Like prairie lire or swarm of the drtu.led
caterpillar passing over Il cotton plantation in
Tho South, lts appearance was as sudden, its
mnrc ns rapid its dcsolalion as complete
In l837 aud 1913 Michigan issued $780,
200 TO bn'ld cnnnls and railroads. Tho Gov
eriior made arrangements with II banking
company to uct rs the agents OF the Stnte in
tho negotiation Of tile bonds. Tho comrany
negotiated n portion of them and made tho
proper returns to the State tho mnncys were
payable in instullmonts. The Stuto was cn,-
tied to receive about $2.S57 ,O397G on tho
remnudor al bonds In hutds of the conpany,
whum suddenly it collapsed, aud it was dis.
covered that the Whole amount of bonds had
been hypotliecutcd .,r sold had pissed into
tile hands OF innocent parties, and wcro out.
standing as a charge against the State The
Governor publicly called upon tito holders of
the bonds either to pay tho balance due utsln
them NY tic company rr surrender them '&4lf
have the amount they paid for them refunded
The Legislature of ls4l confirmed Tho action
OF ihe Oovorhor aud again demanded tho snr-
render cc the bonds upon the terms before
mentioned. A. portion Of tito entiro sum of
SO, ,20O,O 600, amounting to Sl,9S7.O0O, were
not Included in the demand for tile reason
previously given.
The bondholders refused to accept tho com.
promise and 10 further action w,s lnken until
lS46. AT tlint time March, 1860 the St,te
sold her rnilroads md received IN part nay
somo of these part.paid bonds, scnling ilie
principal at tho rnte of S4O3.sS per ST. 900 in
bonds, and the interest nt the rate Of six pcr
cent on SA02 - Tor encli Sl, 900 of said bonds
In 1896, tho Legislature directed, tho tren.
snrer TO notify tho holders of said bonds, by
public advertisement, to surrender thcir bonds
within six mouths, rs after TINT time no ir:-
ter-st would he paid. Tile six months expired
August, 1855. and from TINT tino tho bonds
have been adjusted at tho rate of S5TS5 FOR
onc! ST 900. There are still outstanding
SOD, 900, adjustable Mt SO ,242.7s
Under the operation Of wise legislation,
nlnplc provision having bceu made for the
o
OF the principal, by soemnly setting arurt
portion of the annual rcvenle and the lcyyne
vi specific annual tax for that p,r,m,su- tho
credit OF the StGte has been COMPLETELY re-
stored tile resources of tho State nre largc
and annually increasing willis tho debt is
small taxation light and no OCCASION To make
IT oppressive. Tho anditor-gcner,,I in his re-
port OF September, 1871, states that The sink
ing innd was large enough 10 furnish tho
NG .,l.,,.,, .x>II
before their mnturity. if the holders could ho
Induced to. nder them. md lie Governor,
therefore, re "nds tie repeal OF the act
lcfylng Il ~ nc t..x for tnat purpose
The histt of tho finances of the State OF
Illinois is worthy Of especial notice in this
connection, as in several respects sho passed
through similar experience 10 our own The
success which rewarded that band of patriot;
who combined to restore the credit of the
State, and to lift the cloud Of suspicion Of ro-
plldialion which rested heavily upon her,
might we'll furnish lesson 10 the citizens OF
TINS State who have her best interest Mt heart
The financial troubles of Illinois occurred
:'rior to the adoption Of the constitution of
ls4S. She had neglected for II long ti,no to
pay tho interest upon her debt until tho prin-
clpai nnd its interest nccumuntions amounted
to the enormous sum ESQ considcrcd at that
timc,) OF SlS,000,00O. Party leaders i'm
peachcd the validity Of tho debt mud recon-
Incnded that tile people refuse 10 provide for
its payment, Willie the tax payers relieved
from tn1ation ior one purpose vigorously op-
posed paying any taxes ut I'LL. The distress
,ng condition of tho finances is fifty portrayed
in the report of the auditor of tho State OF
december, 1870. Said ho ITO those who
cnn remember the condition Of the State OF
Illinois Ill lS4I. the treasury empty. the Gov.
ernor borrowing money upon his own credit
To pay the postage OH tho letters written
OH the business Of tie State, her bankruptcy