Iowa voter. [volume] (Knoxville, Iowa) 1867-1874, 1874-05-21

that As the limit below which the United States
notes cannot be reduced without Congressional
enactment. Under the operation OF these
statutes successive Secretaries OF the Treasury
have assumed the right to reissue at their dis
erection $44, 0O0, 600, that is, the difference be-
tween 1856. OK, 600 and s400, 900, 900, and to
withdraw the same again from circulation.
Since the 1st Of October last there have been
issued OF these notes by the Secretary OF the
Treasury S26 0O0, 600, making the whole circu-
lation OF United States notes $685., 100000
The right OF the Secretary TO reissue any
part OF this forty.four millions, or TO increase
The circulation OF these notes above three hum
bred and fifty-six millions, has been continually
denied by many lawyers Ia Congress and out
of 1t, and large portion OF the press; and the
question cannot be said to be free from
doubt. u
In his veto message, and in his letter to
Messrs. Clafin and Anthony on the 2oth OF
September last, the President treats the forty
four millions as being an existing reserve,
sum of money already In tie Treasury, as
much so as a like sum received from taxes,
to be used at the discretion of the Secretary OF
the Treasury for certain purposes.
The first section Of the bill declares the law
to be what the President and Secretary have
assumed II to be. 1t declares that the maxi
mum amount of United States notes shall be
$400, 100000, that is, the amount beyond
which the issue shall not be extended. The
word "maximum" means the greatest. Ii
docs not mean the precise amount, but sim
ply the amount beyond which the issue can
not 60.
Tie section relieved the sGovernment from
the exercise of doubtful power, which had
been the occasion of severe animadversion.
1t was the wish and expectation of the
friends of the bill that the Secretary should
put into circulation the remaining SIS, 000, 600
OF the "a, 600, 600, and 1t was proposed by
some that the language OF the section should
be SO changed as to require that amount to be
put into circulation and kept outstanding.
But 1t was determined otherwise, and that the
bill should simply declare the maximum
amount of circulation, and leave the power
and discretion of the Secretary what they had
been claimed to be.
The other section Of the bill authorizes the
increase of bank-note circulation TO the
amount of SAG, 600, coo, to be distributed among
the States having less than their proportion
upon the basis of the act OF 1865, the new
banks to be established upon the terms, liza
biitics and restrictions imposed upon existing
banks, being required to secure their bills by
| deposit of bonds, redeem them in United
States notes upon demand over their own
| counters or In one Of the redemption cities,
and with the additional restriction that all
| banks, old and new, shall keep one-fourth of
the coin interest they receive upon their
| bonds deposited for the security OF their
notes. This provision looked forward to the
resumption of specie payments, and was the
| first step that had been taken in that direc-
| tion by Congress.
The s46,0O0,0O0 provided for came full
| $50, 0O0, 900 short Of equalizing the distribu-
| ten among the States upon the basis Of the
act of 1865. Under that act the New England
| States were entitled to less than $40, 600 600,
| but received Sl10,000,000, and the other East
ern States had an excess of nearly $l2, 600 600.
Whether the volume of the currency Is suf-
| ficient for the business OF the country is
| question of fact about which men may hon.
estly differ. During the four years preceding
| the panic there had been an actual contraction
of the currency, and a much larger compare
tive contraction resulting from the growth of
population and business. A majority OF Con-
gress were of the opinion that, to produce
restoration of confidence, speedy revival Of
business and return to the prosperity which
was so suddenly destroyed by the panic, some
addition should be made to the volume Of the
currency. ... ...
That the bill which has failed to become a
law would have produced some contraction is
undoubtedly true; bu: 1t would have been
almost entirely In the stock market In New
York. 1t is a well-understood fact that the
reserves of the Western and Southern banks
kept in New York have been loaned by the New
York banks almost exclusively upon call to
dealers in stocks, and have thus contributed to
| stimulate unwholesome speculation, and have
been OF very little benefit to the mercantile or
manufacturing community The evil resulting
| from this fact was strikingly illustrated dur
| ing the panic last fail. The stockholders
| who had borrowed the money were not able
to repay the New York banks, and they in re-
| turn were not able TO pay the country banks
| from which the money had been received, and
thus the disaster Of the panic was greatly ag-
gravated. This bill in effect required the
banks outside of the redemption cities to keep
three-fourths OF their reserve at home, and
4 would have withdrawn some millions from
| the stock market In New York, which would
strengthen the banks to which they belonged,
and would have produced contraction In
| quarter where IL Is pretty well understood
| that contraction would do no harm.
The act of 1862 to strengthen the public
| credit, declares that "the United States SOL
EMMY pledged its faith to make provision at
the earliest practicable period for the redemp-
ton Of the United States notes in COIN" In
the debate upon this bill nobody has denied
the character or binding force of that pledge,
but the question as to the "practicabe
period" for Its performance remains as open
as 1t was upon the day 1t was passed. Very
| few members OF either house OF Congress
have agreed upon any method for the resump-
! ton Of specie payments. few are In favor
| of boarding the gold I'm the Treasury until
enough has been acquired TO begin
| the redemption of the notes. Others
have proposed to acquire the requisite
amount of gold by selling our bonds In Eu-
rope Others to fund portion of the legal
| tender notes In bonds bearing per cent. In
terest, and retire them Ia that way, to bring
| the rest to par by contraction others to fund
them into bond bearing per cent. interest,
to be issued and again funded.
While the Government is pledged TO redeem
| the legal-tender notes In coin, at the earliest
practicable period-while the purpose to do SO
should ever be kept in view-yet that period
1 sl.....
there Is great stagnation of business, much
labor unemployed, the revenues largely fallen
of, and much distress and suffering in every
part OF the country.