Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1875-06-18


ed in the NesD York Tribune Of Tuesday,
Possesses a local as well as general
interest. The ex-Secretary of the Treas
ury with opens the assertion that the
credit Of the United States ought to
be equal, if not superior, to that of any
other nation. We may not be as rich
as others in accumulated wealth, but
our resources are almost untouched,
while those of other countries are more
or less exhausted. The population is
increasing more rapidly than any other
country, while it ranks all in energy,
inventive talent, and general intelli-
gence. None can rival us in
fertility of soil, richness of minerals
and capacity to produce from these two
sources all articles Of necessity or utili-
ty. At the same time we are not bur-
dened with the enormous expense of
maintaining in unproductive idleness
standing armyof hundreds of thous-
ands, or a costly navy. In addition to
this, the traditional policy Of the Uni
ted States to steadily reduce its debt,
Is being persistently adhered to even to
this hour. This circumstance, in CON-
parison with the condition and policy
of other nations ought to make our
national credit the best In the world.
No other country can exhibit such
wealth Of resources from which
to meet its obligations. No other
nation enjoys our exceptional geo.
graphical position which renders large
standing army unnecessary, and none
others manifest such a readiness to de-
crease its debt as rapidly as possible.
The majority are chronic borrowers,
each year bringing its own deficit, to
be made good only by negotiating new
loans. Why is it, then, that the credit
Of the United States ranks so low in
the money markets Of the world-that
We are paying six per cent interest
where other nations pay only three?
First and most powerful among the
causes of this unnatural depression,
Mr.. McCulloch ranks the defaulting of
States on their bonds or interest. The
effect of railroad failures and bank
failures, such as the past two years
have witnessed, exert very little effect,
compared with suspension" by States,
because the former are attributed to
the extravaganza and indiscretion of
individuals or corporations, while the
latter are taken as a reflex Of the peo-
pie and of the American system Of gov
eminent. If the majority rule, then
the majority of the people in any de-
linquent State must be shiftless or
dishonest. Either they make contracts
recklessly that they cannot keep, or they
break them dishonesty. With rich,
virgin resources, these bankrupts must
be either fools, who cannot measure
their ability to pay, or knayes, who DO
not want to pay. This view Of the peo-
pie, drawn from the idea that the ma
jority rule, comes home TO every one Of
us, because 1t deters foreign capital
from venturing among us IN any sort
Of enterprise. Thus a State loses, in
directly, an hundred-fold of any amount
supposed to be saved by default.
In another way the deEnquencies of
States seriously affect the credit Of the
General Government. The United
States is a complex affair, embracing
under it number of States
enjoying many prerogatives of
sovereignty. The State borTows
money on its own responsibility. 1t
then pleads its sovereignty in bar
against recovery Of the debt in court.
At the same time the State is not re-
sponsible to the laws of nations, the
central government standing between
it and the world. The government of
the aggreived foreign creditor can ma Ike
no demand on the State for reparation.
If demand be made on the United
States, the latter has no power to force
the State into compliance with It's
money contract. To the European
mind, this peculiar system, which
lodges responsibility nowhere, and even
precludes appeal to that ultima ratio,
war, is simply incomprehensible, 1t
looks, to their eyes, very much
ike a system organized to make fraud
successful and irresponsible. If this
be the American system, they ask, how
can, We trust the United States whose
government and people countenances
it How long before the national bonds
follow the way of State bonds? In
European countries, the debts Of any
subdivision, such as a province or a de-
partment, can be recovered in the
courts, the same as those of cities and
counties with US. Their political sub
divisions do not enjoy any share of
sovereignty. The lesson for US is that,
if We prize local self-goverDment
and State sovereignty, we should
be careful never to abuse
: it. Sovereignty imposes duties as
well as privileges, and the policy that
would interpose sovereignty against
Just claims, is not one calculated to
perpetuate it, nor becoming a free
people.
Mr. McCulloch cited some curious in.
cidents in proof Of the deleterious and
long-enduring effects Of Site delin-
quencies. The action Of some States
IL taking advantage Of the legal tender
act to pay in greenbacks, interest that
was contracted in gold times, appears
TO the foreigner as unjust as would be
any other offer Of IS per cent. when
| 100 was promised. As far back as 1897,
Indiana, Mr.. McCulloch's own State,
| Watched III, % sort oF cor,,,r-,,,