Yorkville enquirer. [volume] (Yorkville, S.C.) 1855-2006, 1874-04-30
VETO OF THE SENATE FINANCE BILL.

VETO OF THE SENATE FINANCE BILL.
On Wednesday of last week, the President
transmitted to the Senate his message, return
ing without his approval, the finance bill
which originated in that body and recently
passed by both Houses of Congress, authori-
zing the increase of the United States legal
tender and the national bank note circulation
to an aggregate of s8OO,OOO0O0. The mes
sage contains the following arguments against
the measure:
Practically It'll question whether the meas.
ure under discussion would give an additional
dollar to the redeemable paper currency of
the country or not, and whether, by requiring
three-fourths Of the reserves to be retained by
the banks, and prohibiting interest to be re-
ceved on the balance, it might not prove
contraction. But the fact cannot be conceal
ed that, theoretically, the bill increases the
paper circulation S1O0,O00,000, less only the
amount of reserves restrained from circulation
by the provision of the second section. The
measure has been supported on the theory
that it would give increased circulation. 1t
is fair inference, therefore, that if, in prac.
tice, the measure should fail to create the
abundance of circulation expected of it, the
friends Of the measure, particularly those out
of Congress, would clamor for such imitation
as would give the expected relief.
The theory, in my belief, is departure from
the true principles Of finance, national interest,
national obligation to creditors, congressional
promises, party pledges on the part of both
political parties, and of personal views and
promises made by me in every annual message
sent to Congress and in each inaugural nd.
dress.
A declaration contained in the act of June
30, 1864, created an obligation that the total
amount of United States notes issued, or to
be issued, should never exceed four hundred
millions of dollars. The amount in actual
circulation was actually reduced to three hun
dred and ffty-six millions of dollars, at which
point Congress passed the act Of February 4,
1868, suspending the further reduction Of the
currency. The forty-four millions have ever
been regarded as reserve to be used only in
case of emergency, such as has occurred on
several occasions, and must occur when from
any cause revenues suddenly fall below ex-
penditures and such reserve is necessary be-
cause the fractional currency, amounting to
fifty millions, is redeemable in legal tenders on
call.
1t may be said that such return of frac-
tional currency for redemption is impossible.
But let steps be taken for return to specie
basis, and it will be- found that silver will take
the place of fractional currency as rapidly as
it can be supplied, and when the premium on
gold reaches sufficiently low point, with the
amount of United States notes to be issued
permanently fixed within proper limits, and
the treasury strengthened as to be able to re-
deem them in coin on demand, it will then be
safe to inaugurate system of free banking
with such provisions as to make compulsory
redemption of the circulating notes of the
banks in coin or in United States notes, them
selves redeenable and made equivalent to
coin.
AS measure preparatory to free banking,
or for placing the government in a condition
to redeem its notes in coin at the earliest prac-
ticable moment, the revenues of the country
should be increased 80 as to pay current ex.
penses, provide for the sinking fund required
by law, and also surplus to be retained in
the treasury in gold. am not believer in
any artificial method of making paper money
equal to coin when the coin is not owned or
held ready to redeem the promises to pay, for
paper money is nothing more than promises to
pay, and is valuable exactly in proportion to
the amount of coin that it can be converted
into. While coin is not used as circulating
medium, or the currency of the country is not
convertible into it at par, it becomes an arti-
Gle of commerce as much as any other product.
The surplus will seek foreign market, as
will any other surplus. The balance of trade
has nothing to do with the question. Duties
on imports being required in coin creates
limited demand for gold. About enough to
satisfy that demand remains in the country.
To increase this supply l see no way open but
by the government boarding through the
means above given, and possibly by requiring
the national banks to aid.
1t lis claimed by the advocates of the meas
reherewith returned that there is an unequal
distribution of the banking capital of the
country. was disposed to give great weight
to this view of the question at first, but on re-
Election it will be remembered that there still
remains four millions of dollars of authorized
bank note circulation assigned to States hav-
ing less than their quota not yet taken. In
addition to this, the States having less than
their quota of bank circulation have the opt
ion of twenty-five millions more, to be taken
from those States having more than their pro-
portion. When this is all taken up or when
specie payments are fully restored, or are in
rapid process of restoration, will be the time
to consider the question of more "currency."
s6~ A law court in Iowa has fined farmer
twenty dollars, because he made his son turn