New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1877-09-07

Some eight or nine years ago. the CITY of Mont
g0mery issued bonds to the amount OF 100000, in
aid OF the South and North Alabama Railway, the
bonds bearing interest at per cent, payable semi
annually. The bonds were sold, of course in New
York. aud the interest paid until July, 1874,
when they defaulted The City Council of Mont
gomery now propose to settle with the bond
holders on these terms, and accompany the
proposal with a menace The past due coupons
TO July of this year are to be funded
in full. Twenty-Five per cent of the principal of
the bonds is to be paid in stock of the South and
North Alabama Railway, and the remaining 70 per
cent is 10 be funded, with the past due coupons into
a new bond dated January 1. 1877 the interest for
the first five years to he percent the next five per
cent. and the remaining twenty years per cent
These terms, however favorable TO the City of
Montgomery, can hardly be regarded favor
able to the bondholders. The stock of the
South and North Alabama road not be
supposed to have any value, while the
security of the new bonds is no better
since it is the same than the security of the old
ones What guarantee have the bondholders that
the new bonds will not default asoi Then the
interest at only 3, 4, and per cent. extend
ing through thirty years, is not what might be ex
pected. Why should Alabama, or any part of it,
borrow money al lower rates than the Government,
particularly after this kind of fnanciering The
South has always complained that it has not been
able TO get money on rs favorable terms as the
North II is never likely to- if the present transac-
tion Is 10 be taken "a a representative case. Mont
pomerv has always been regarded as one of the most
substantial and nourishing cities of the South. and
its inability or unwilIingness to make any better
arrangemeftsfor dcfaulted bonds. amounting to 50
small a sum a. Sj0OOOO, is not eucOuraging-to put
it mildly-;o Northern capitalists to make invest
menis i'm that section. The South declares that il
needs Northern capital for ITS DEVELOPMENT. If it
does it is certainly unwise to attempt to force such
hard terms upon its creditors We say force, as we
have before used the term menace. because the first
section of the ordinance passed by the City Council
of Montgomery ordains that from and after its pas
sage i'm every instance in which any holder shall fail
after thirty days to accept the offer of compromise
the commissioners of the city debt directed under
no circumstances to have any further negotiation,
nor TO entertain any proposition of settlement what
soever with any holder of the bonds This may well
be called financial " bulldozing.'
II must be frankly said that this is discouragng
news from Washington about the first law-olicer of
the Treasury To be getting into street braws about
petty newspaper squibs, would be sufficiently dis
gushing in any officer. But for a man, sixty or
seventy years old whose business il Is to know and
construe the law for great department,
to prove himself the cheapest of vulgar
law breakers is intoerable. Appointments of this
wretched sort doing too much To bring all
Civil Service Reform talk into dsrepute. Here we
have had one man Of spotted political character sent