The New Orleans bulletin. [volume] (New Orleans [La.]) 1874-1876, 1875-12-14
RESUMPTION.

Secretary Bristow's report embodies plan
: for the resumption Of specie payments" te
8 use the popular phrase more accurately
= speaking, the restoration Of a specie circula.
: ton. He proposes first, to deprive the
: treasury note of its legal tender character by
b providing that, after January l, 1877 paper
8 shall not be legal tender for debts contract
, ed after that date; second, that treasury
/ notes may be funded in four per cent bonds
} at rate not to exceed $4,000, 900 month;
? third, to augment the coin receipts Of the
, government by restoring the duties On tea
, and coffee; and, fourth, to accumulate gold
| by the sale of bonds. It is quite probable
that this plan, if adopted, would have the
effect desired by the Secretary. That is osay.
it would, in time, and perhaps in a COMPARE
lively short time, establish an equilibrium be-
tween paper and coin. Indeed the first two
| propositions would alone seem to be effective
for this purpose. 1t is difficult to see in what
manner the fourth or last feature of the plan
is to have any effect on its main object. Il is
very true that bonds may be sold for gold,
but it does not follow that this process will
augment the coin balances in the Treasury
The bonds must be bought before they can
be sold, end they must be bought either for
gold or greenbacks. The ordinary process
is to sell the Treasury gold tor greenbacks,
and with the greenbacks to buy bonds. If
these bonds are Cancelled, just SO much of the
public funded debt is extnguished.
If they are sold again for gold, the only
effect is to bring back into the treasury the
gold which had originally been paid out. Of
course an issue of new bonds would be
different kind of transaction but this would
be simply equivalent to borrowing gold for
the redemption of the paper circulation. The
only form in which the Secretary proposes to
put out a new loan is that of four per cent
bonds directly exchangeable for greenbacks.
We have little doubt that if Congress were to
enact that S25,0O0,O00 Of paper per annum
should be retired in this manner, an equality
between gold and paper would be established
long before the date fixed for resumption by
the act of last year. What causes the depre-
citation of paper is not SO much redundant
currency, as its inconvertibe character, and |
the uncertainty that it will ever be redeemed
The United States Treasury note is dishon-
ored promise to pay If it is equivalent to
demand note, it is q continually violated
promise, and if it is assumed that its redemp-
ton is to be RENTED to an indefinite future,
it will finally lose its value altogether. AS
soon as it is understood that definite and |
unalterable plan of redemption has been |
adopted and confidence in the final redemp-
ton Of the paper circulation is established, it
will not take long to bring greenbacks to par.
In that case their final retirement would be
a simple problem. The result would be much
facilitated by depriving them of their
legal tender character as to future debts,
thereby causing them to repose only CT the
more legitimate support of public confidence.
The restoration of the duties on tea and
coffee is a measure of reform which ought to
be adopted without reference to the currency
question. If these duties are restored only
for the sake Of laying up a store Of surplus
gold in the Treasury, the duties would operate
as an increased tax. whereas they should oper-
ate in the sense of a reduction o. taxation or at
least reduction Of the burdens on industry
growing out Of the protective system. The
abolition of the duties on tea and coffee, of
course, caused large deficit in the revenue.
This deficit was made up by an in
crease of duties on o!her articles main
ly such as are, to certain extent,
produced in this country, SO that, whilst
the public still pay the tax to the government,
they are forced to pay much larger sum to
American manufacturers, in the shape OF the
prices of certain domestic products.
To restore the tea and coffee duty would be
desirable measure of revenue reform, and
step toward approximate free-trade, if it were
combined with corresponding reduction of
the tariff on other articles, but not other
wise. Hence it would be mistake to conpect
t with the currency question in the manner
proposed by Secretary Bristow.