The Indiana State sentinel. [volume] (Indianapolis) 1868-1895, 1875-09-09

Il
and national bank notes. lam not In favor OF.
| the policy that proposes to retire the treasury
national banks and their paper. The
/ treasury notes are the cheaper currency 10 the
not irredeemable. For their value they rest upon
/ the pledge and conscience OF the country. Inc
| relation between the holder anu the soNSaIn-
ment is direct. The people are not requlre9 10
pay interest," upon national bonds deposited as
the basis of their security ana value, as IN the
case of bank notes. Passing everS wnere, ana
without question, they are the favorlte ana pop
1 ask your very careful consideration OF
| the last provision OF the act. 1t would
have been idle, as well as vicious, Tor
uTV TO redeem the legal tenders In coin without
making provision for the same. 10 mSet uie
necessity the act provides: "Ano 70 enaole tl,e
secretary of the treasury to prepare and provide
for the redeIE ption in this act authorlzea or re-
quired, he is authorized TO use any surplus rev
enues from time 10 time in the treasury not
otherwise appropriated, and 10 issue, sell aud
dispose of at not less than par In coin, ei5nef OF
described IN the act of c1ngre IS approved ulY Ia
eighteen hundred and seventy, entitled AN act
with like GuaIifies. privileges and exemptions,
10 the extent necessary 10 carry THIS act ihIo iuu
effect and 10 use the proceeds thereOi LOT III, tne
incon sistent with the provisions OF this act are
hereby repealed" At the passage OF this act,
there was outstanding, as suppose, k3oz,oOOtOJ
of legal tender notes. az provided in the act of
June, 1874 should the SS2,0O,OJG be retired oy
the substitution OF bank notes under the nlst
section, then there will remain S3OOVoOOOO to be
Is S gf S VIII ne entirely displaced by bank
nOies Ifnot. an excess of the sjO01o000J will re-
main for REDEEM ption in gold. That excess VIII
prob sbly equal the surplus revenues IA goo ti
purpos IS of the act. suppose II may therefore
be as sumed that the secretary will be REQUIRED
10 sell five per cent. bonds 10 meet SoOOOtpsOO
OF treasury notes. The immediate and direct
efis1t OF the measure wi De 10 increase
our interest tnTe re- flee ni i
in gold. If we ad the forty millions OF bonds
that must be cid TO buy silver TO displace the
fractional currency. we naVe.ln TINS measure
an increase of the interest bearing debt of $780,
OO0gOO, and OF the annual interest Of sl7 OJJO0 in
gold. The bonds will be sold in Europe. IhlS
administration conducts all such transactions
through a European syndicate, or combination
OF bar KS Thus the debt will be foreign one,
and will add sl7, OO.0O0 to the enormous annual
expectation OF gold to meet interest. What con-
sderation of obligation or OF coed policy can sup
port this measure? In the midst OF ahuancial
crisis serious as 10 disturb The foundations OF
our prosperity, We are to add this large sum a 70
our foreign debt. Why Is IL done? The s352OOJ.-
Coz oftreaSury notes are held exclusively oy our
an people Ii is a domestic dent. The holders
are not asAlns lts Ieoein PtIoi. roI .iie - I,
they want IL 10 remain circulating emohg mem
as lawful money" The treasury
notes were is ued as legal ts 6sse az az
he essential to the maintenance OF
the public credit. It was deemed eSpedient to
issue portion ofthe governments creuls IN the
form OF currency and, therefore the treasury
notes bear q double Character. Jncy are 81 once
the evidenced n government debt, and are
medium ok commerce, q debt to be paid, and le-
i.sl lenders to be used. They were so issued by
the governmcn. aud so accepted by the people
No lime was fixed for their redemption. The
people received them, leaving that % The pleas
ure aad conscience OF the government. IN the
meantime they have b-en used as money. Then !
IN accordance with the purpose of their issue,
should they be Withdrawn so as 10 injure busl-
ness aud labor, until as good or
Every obligation OF the government must be
met and discharged. Whoever questions the
fidelity of the Democracy TO the country
honor ct.SO
truth. fully recognize the obligation lOr the
redemption OF the treasury notes, but can not
feel that il must be discharged at time when 1t
may seriously add to our embarrassments, and
when the people, who hold them, do not desire
IL. In our present condition any addition 10
our foreign gold Obligations is calamity. VIII
you vo TO convert this domestic, non-interest- |
gold debt? In this statement have made no
estimate Tor the sale OF bonds and increase of in
the secretary to redeem the eighty-two million
legal tenders, which are TO be displaced as bank
bills issue.
1t is now my duty to call your
attention TO other probable consequences
OF this measure, more frightful than those
which have eXposed. as the time for inc re-
dempton OF the treasury NOES In gold ap- /
breaches, and the secretary prepares for their re-
oemption by the sale of bonds and the accumu- /
advance in value. During the period OF two |
years before the redemption commences, par |
sons who are able 10 hold money out OF active |
use, will accumulate and retire the treasury /
nstes for the profit of their increasing value /
The banks are permitted by law TO redeem their /
bills in treasury notes. So long as the bills and
not IS are about the same value the bills are not
presented to the banks for pay nent. But as
will be presented Tor payment. The banks will |
anticipate that probable result and viii prepare /
for 1t by boarding the treasury notes Tor the re-
demptiOn OF their paper. The probable conSe- |
quence will he that under these influences the |
treasury notes will. for considerable per cd of
currency VIII be contracted TO nearly one-half |
its quantity Asrap!dly as the treasury notes
of the bank bills they Will be presented |
at the treasury Tor redemption IN gold, and Wi!
disappear forever l know il is said
Iished that they are redeemsble in gold |
. hey viii not be presented as they will then be
s IS good as god. To some extent that would be
true in a Time of established composure and
confidence, but that will not be the condition of
our country whilst this law is being executed. |
maturity merely because you have confidence
debtor? How long do you think the gold paid
out in The redemption OF the treasury notes VII
VEINS and arteries of business and give life and
energy? In a time of general confidence 1t
might be so, but not whilst this law is being
stability can not be made 20 rest upon borrowed
gold. This measure will increase our gold obli-
reduce production at nome. This flow OF sold
abroad Will continue, aud the borrowed gold
will soon be gone. In this presentation
of the subject L have not considered the
possibility OF any extraot binary foreign demand.
Any great financial crisis abroad, or disturb
ance of the peace Of Europe. would cause our
bonds TO be thrown upon our market in large
quantities, and correspond ug draft upon our
supply of gold. L do not believe we can rely
upon ihis measure for any supply of gol 10 our
domestic currency that will be permanent or
useful. Substantially our reliance for a cur
rency must then be upon the banks. VIII they
be in a condition to supply it? The retirement
of the treasury notes viii leave them under the
obligation to redeem in gold only. Can they
meet that obligation? And with the known
uncertainty IN the supply OF gold, will
they venture to throw their paper upon the
currents of trade in quantities a. all adequate
to the demands of legitimate business? The act
permits tree banking. and the bills are yet .e-
deemaDte IN Urea ury notes. WnaG mas
been the result? The statement of
the comptroller, made on the 9th of July. shows
that since the passage OF the law, January IA.
1875, TO the Ist of July, nearly
hal year, the increase OF bank
currency is but seven thousand five hundred
and fiflY-eight dollars. Does this Statemen ins-