Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1874-09-22

ed OF all Glasses - 5fr2 o.
Making the total vet to be Registered
or tuhded-- .--..-...-......----..S.- 5,oh 81
And the grand total which has been or can
be funded or registered will thus amount
TO So, 100000. Of this amount the sol
vent roads will hereafter pay s., 46I, ST.. 40,
and the pun chaseTs Of delinquent railroads
will pay SS23,2 T7, total, $, rs, 1879; leSv-
ing 10 be provided for by the State S20,-
go, ISL IS.
"The bonds which have been thus ne
newed Under she provisions of the funding
law, were ali issied before the war. to eS-
tablish the Bank Of Tennessee, for tlrs con-
stTuction Of the Capitol, and the building
of turnpike roads, and large majority Of
,he coupons funded were from the same
class OF aIiti-Esf bonds. against which no
possible question could disc. Not one
bond issued since the close of the war has
been funded under the act, nor can be.
"Tle past due debt amounted TO less than
S7,OOO;OOg, and. rs ] believe, less than ST.
5O0,OUO. But this afnOIInt could not be
paid at once without paralyzirg Industry
aid b'irging distress to the country. CUt-
plants are made Of = tax Of forty cents on
the hundred dollars, which IS barely Sufii-
ciert for the current interest. To have de
voted the entire tax to the payment Of this
past due debt would have required FIVE
years % estfnsnish It, and in the meantime
the current interest WGala have matuFed 10
the amount Of $6,0O00OO. To hate lefs
these bonds and coupons unprOyided for
while returning the payment Of interest
would be like an iTift7idUal who makes
provision for payment of debts 10. vas due,
but fails TO provide for those Of equal digni-
" already past due. The State found her
self like i.IzTry solvent individuals who
having large property, nave n. money with
which to pay past-due deOt, and like 5nr
business man in your commercial circles
surrounded by these unusual and untOwarl
Circumstances, she proposed TO her cred
itOrs 20 renew her past-due obligations at
their face to sofie future day, and in the
meantime pay interest for the fOrbeafanCe.
trusting to renewed prosperity and in-
creased business TO meet her obligations,
thus doing justice as between creditor, and
preserving intact her own faith and honor.
Ard this very process Of indi iidual adjust
ment of debts by renewing them, is essen
tally funding The State, under the
operation Of this funding bill, instead of
paying her niatured debt, renews il, paya-
bic at future day, and obligates herself, in
the meantime, to pay interest upon it.
Before the converting Of the next General
Assemb Y, the Law will have been fully ex-
ecuted, and the people of the state, through
their chosen representatives, have plight
ed the faith and honor of the State TO
compliance with its provisions. There
is a striking feature in the practical re
suits of this legislation which has not
yet been considered. Ii will not be
questioned by any well-infOrmed legal
mind. that as legal proposition, all Of this
due obligation bore interest from its ma
turity until redeemed By the State. In
the case of the city Of Nashville, vs.. abe
First National Bank, adjudged by the Su-
preme Court az tine December term, 1872,
il is held that the coupons of the bonds of
the city of Nashville bore interest from ma
turity, and the terms and language of those
coupons do not differ, in any essential par
ticular, from our coupons. Now, the hold
ers Of our past-due bonds aud coupons, in
consideration Of the pledge Of the State 10
commence payiAg interest the first of July,
1874, and her solemn promise to continue
Its payment rs il accrues, were willing to,
and did, accept our new bonds for the face
Of their securities They thereby lost, and
the State saved, this item of interest. But
the creditor gave il up, under a contract
with the State, that he should receive in
terest regularly upon his new bonds. Had
this contract not been made, the creditor
could, and doubtless would, have demanded
Of the State this large amount Of interest.
'The following table shows the amount
already saved TO the Stale by this means
fttrniafN rail
as the amount that viii be saved. when
the funding is completed:
SAVING OF INTEREST By THE FUNDING
BILL.
"The creditors OF the State have submit
ted to a loss of interest on paSt-lue bonds
and coupons, thus far funded, as follows:
ON past-due Bank OF Tennessee
bonds maturing in 1s6S .........S 6,55j 90
on turnpike bonds maturing from
July, 1853, to January, 1S74....... I0,SoO "a
ON Capitol bonds maturing from
March, 1870, 10 January, ISL. Al $50 ~
Total loss of interest on bonds. 5 1885 90
Interest ON coupons maturing from
July, 1869, to January, lSIl........ IOS,65I 81
Total on bonds and coupons ....s $50 81
"This amount is upon such bonds and
coupons as have already been funded. Up
Oh Lut anu NAAeAt lNb W
presented, a saving of interest in the same
proportion will likewise be made.
On bonds yet to be presented. .--....S 1890 90
on coupons yet tn be presented...... lH,75O %
Totai.. ...-...--............-s Sl,66o 90
Add amount already saved.......... SISSY 81
Aggregate amount saved. ,l24, DAP 81
"And while this amount Is a clear gain
TO the State, the interest TO be paid OF the
new bonds is only the same interest for
which the State was bound ON the old Sc
cnrities. And while this large amount
has been saved, the execution Of the fund
ing act has cost the State less than four
thousand dollars. The popular error that
the whole debt Of the State, which is as
sumed to be SIS, 900, 900, las been postponed
forty years, and that at the end of that pc
ried the State will have paid S6O,OO0,OOO of
interest without reducing the principal,
grows out of amiscOneeptiOn Ofthe practical
effects.of the law, and is completely refuted
by this statement Of the facts. The elev-
enth section of the act, provides "that the
bonds that may fall due between the first
day of July, 1874, and the first day of July,
1884, shall be fundable, at the option Of
the State, in bonds authorized by the first
section Oh ILLS III luc COllollHCliOA XIV
en- to this section by the Executive Depart
ment is that this option of the State must
be declared by the General Assembly; so
that the bonds maturing between those
dates, amounting TO S371 600, can either be
funded or paid, as the General Assembly
in its wisdom may declare. And 50 of the
$43S,OOO Of bonds that mature after July
1884, and prior to 1892. And the balance,
which mature between the latter date and
the year 1909, will also be the subjeci OF
future legislation. All
THE FUNDING BONDS
already authorized, which will amount, as
already shown, TO less than 100000, are
redeemable at the option of the State. Sc
that neither the Funding bill nor the re-
sumption of interest payment can, in the
least, embaTTass the payment Of the princi-
pal, whenever the condition 81 our finance:
viii justify such policy. The third sec
ton Of the act pledges "the filth, honoi
and credit of the Stale" for providing .
sinking fand for paying the principal a:
] well as the current interest; and the people