Whig and tribune. [volume] (Jackson, Tenn.) 1870-1877, 1873-06-14
The Funding scheme---Ansthsr.


The Funding Scheme---AnsIher.
Mai. Lewis Tillman, of Bedford
county, suggests = cheaper, more
speedy and more economical way of
paying the State debt than by fund
ing at six per cent fer forty years,
for the payment of interest alone.
Under the caption
How TO Pay the state Debt, Prin.
cipaI and Interest
In a short time, with less money
and q larger rate OF interest than is
required TO pay the interest alone,
under the principle and plan of the
late funding bill.
Suppose the aggregate debt, $25-
100000, interest at per cent. would
be 81, 100000 annually, and for forty
years, (the time allotted the new
bonds,) sixty millions Of interest to
be paid by the people, and of the
principal, not a dollar paid.
Now, suppose we create a series
of bonds, aggregating SIS, OOo, 600,
making a million due each success
sive year, from one to twenty-five
years, bearing $50 per cent inter-
est, and bind ourselves to pay the
principal and interest of each mill
ion on and after it falls due. How
would il result in the twenty-five
years?
Let us see. The first year, we
would have to pay one million and
seventy-three thousand dollars; the
last year twenty-five years hence-l
we would have to pay two millions
eight hundred and twenty-five thou
sand dollars, and our average an
nual payments, would be one mill
| ion nine hundred and forty-nine
| thousand dollars.
But ii would be about seven years
before the yearly payment would
equal the payment we have to begin
with to meet the demands of the
late funding bill. A good breath
ing spell in our Elk"
The aggregate sum to wipe out the
| principal and interest in the twenty
i've years, would be forty-eight mill
ions eight hundred; elevt n millions
two hundred and seYenty-five thou
sand dollars less than the mere in
terest for the forty years under the
funding bill.
Now this comparison is made up
on the supposition that the 1-3O
interest bearing bonds would be Ia
ken by the holders of the 6 per cent
cid bonds at par, and certainly they
should not have them below.
But is it not morally certain that
several millions of the z $50 bonds
first falling due, would command 8
premium, offered to the highest bid
der of holders of the old bonds, ir.
respective of their dates of issuance
or maturity.
| submit that this process of fund.
ing would be in the interest of the
State and people, while the one thai
has been adopted, is in the interest
of the bond holders altogether.
l submit that this process would
bring the old bonds in to be cancell
ed at far valuation and equiVa
lent, while the other proposes tC
pay their face value, regardless o.
their market value and embarrassed
condition of the people.
submit that the plan adopted il
a make-shift to bolster up the cred
it of the State, without paying ;
dollar of the debt, but rather in
creasing it, and will tempt no tid'
of immigration, nor start any stream
of commerce or gush OF enterprise
while the plan l propose looks Il
business, and in a few years would
give the State better credit, great
err enterprise and brighter future
than she has enjoyed for lOnl
time.
Let the experiment be made will
five millions of such bonds as | pro
pose, consisting of denomination
running from twenty-five dollars Il
thousands, and if they are not takel
, at a handsome premium, in ex
change for the old, then let then
1.-THE old) float in the market, and w
will use all the economy and saw
, all the money we can, and pay thos
, 1irst who show US the most favor.
IN conclusion of this L will say
it Is thought we can't start with
million, increasing annually seven
ty-three thousand dollars and g
through in twenty-five years, let u
start with seven hundred and fift,
thousand dollars, increasing fifty
four thousand seven hundred ant
forty dollars annually, and we vii
+ 20 through in about thirty-thre
years, paying in the aggregate abou
fifty-six millions of dollars. Still
less than the mere interest, undo
the funding bill.
If we agree to pay 7-30 per cent
in lieu of per cent to get the favO
of making combined payments o
principal and interest, and if som
one chooses to call it a proposition
or threat to repudiate, let us NOV
steadily on, paying as we can
and convince the world "and tn
rest OF mankind" that we intend Il
get out of debt and stay out.
LEWIS TILLMAN.