Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1874-12-16
HUNTERS FINANCrAI PAN.cr.

/
of the Governor. To convey a brief
and intelligent view of the proposed
scheme and its distinctive features, we
cannot improve on the language of its
opening paragraph:
Let the State issue So. OO0. 900 In bills
of the denomination of 81, IS, SO,
$50, and In fractions of dollar, with
provision that the holder may at pleas
ure convert these notes In sums of 500,
or multiples of Sl00, to draw interest
from the State at the rate of four per
cent. per annum, IN specie. la addition
to which, the holder Of this bond shall
be allowed to reinvest into bills of the
like denomination as at first; which bills
shall bear no interest, but shall be con-
vertlble andre convertible as originally
provided. The interest on these bonds
shall be paid semi annually, unless the
holder should convert them into cur
rency at shorter period, when interest
shall be paid for the period of its ex-
istence as bond. Until the sum of
100000 has been issued, any holder
of Virginia State bonds shall be al
lowed to exchange them for these bills
at the market price in Richmond when
sold for legal tenders. And when once
issued these bills may be received at
par IN payment for half the taxes of
any person or corporation who may
owe the State for taxes.
1t will be noticed that, practically,
the above would be the application to a
State of the pivotal principle on which
Mr.. Kelley's plan of interconvertible
bonds at 3.65 Der cent. interest is based.
The main objection urged against this
''elastic" system as applied to the coun-
try at large is that it would place the
Volume of currency at the mercy of
Wall street Spectators, who would
organize ffty-million dollar pools and
expand or contract, at their own sweet
viii, IN the very nick of time to affect
trade and the value Of incoming crops.
Remember Brother-in-law Corbin's
Black Friday, and remember that it
would be an easy operation to convert
few hundred millions of six per cent.
bonds into greenbacks and thence into
3.65's, for the sake of contracting
the currency and the value of
every moving crop. A few
months loss of the difference
In interest-only 2.S5 per cent. per an
num-would be amply repaid by the
double prices put on the crops after
leaving the farmers hands, by loosing
the floods of currency, and reconvert-
ing the 3.65's into greenbacks. Pow
erful monopolies, and combinations of
monopohes, are among the giants that
have grown up under fostering Radical
rule, and which We have to fight.
We are frank to say that the force Of |
this objection to an interconvertible
currency for the country at large, would |
be comparatively Insignificant in its
application to one isolated State, as
Virginia. If all the States, however,
or large proportion Of them should |
adopt the plan, the question would |
loom into Importance, though specula-
tors would find much more difficulty in |
manipulating large pools.
The advantages which Mr.. Hunter |
argues would accrue to Virginia from
the issue direct of s., 100000 State cur
rency on the conditions given above, |
are, that it would relieve the financial |
stringency In that State, and, at the |
same time, increase the sinking fund in |
various ways, principally by the reduc-
ton of interest from to 4 per cent, |
and the retirement, at market rates, of |
SIX or seven million dollars of outstand- |
ing bonds, therangeofquotation in New
York being at present 80 to So cents
on the dollar. 1t is claimed, also,
that the payment of half the taxes in
this currency would afford great relief |
to the people, besides enhancing the
credit of the State.
Mr.. Hunter argues at length the
legality of such financial plan under
existing enactments. He dismisses the
clause of the National Bank act taxing
the notes of any private or State bank
ten per cent, by intimating that he
proposes no bank whatever, the bills
being issued direct by the State. This
view calls up the clause in the Federal
Constitution itself, forbidding States
to ''emit bills Of credit" He reviews
the opinion of Chief Justice Marshall
in Craig VS.. Missouri. Peters, and,
without entirely destroying the force
of its definition of "bills of credit"
which would cover the style of curren-
ey proposed, he proceeds to argue that
later decisions of the Supreme Court
have virtually reversed Marshall's
opinion, specially citing the
Bank of Kentucky case, in
IL Peters, and Darlington VS.. Alabama
Bank in Is Howard. Heialso repro
duces letter from James Madison,
at the time of Marshall's
decision, which throws new light on
the purposes of the trainers of the Con-
stitution. From these sources Mr..
reaches the definition of 'biIl
of credit" as being a note designed to
circulate for money, TO the payment
Of which in money the State pledges
its faith. The proposed Virginia cur
rency does not meet the latter provis-
ion, the State net pledging redemption
in money, but in bonds, and their ac-
ceptance, like ordinary warrants, for
taxes. The distinction is a delicate
one, and we are not satisfied that the
State Treasurer makes
his case out clearly.
Toward the close of his exposition
MIR. Hunter suggests that this issue of
100000 might be made doubly USE :
ful as the basis for State bank, the