National Republican., 1877-12-04

tlKnty pcT CtnDUm of tnt tut1 Oi natlOnul
bank notes issued, and to continue such re-
domption, as circulating notes are issued, until
there shall be outstanding the sum Of $780,,
100000 Of such lcgal-tender United States
notes, and no more. h" TO
In obedience to this act, there have been is-
sued, since March I, 1877. to national banks,
SIC, ,123,995 Of circulating notes. and there have
been redeemed, retired and cancelled, $40, ,S99,-
LOG OF United States notes, leaving outstand-
ing, on the 1st instant, the sum Of 1851 $40 2ss
BY the same act IL Is provided that on and
after the first day Of January, 1879, the Sec
rotary Of tho Treasury shall redeem, in coin,
the United States legal.tcndcr notes then out
standing, on their presentation for redemption
at the Office Of tho assistant treasurer Of tho
United States, In the city Of New York, In
sums Of not less than fifty dollars. "hnd, to
enable the Secretary Of the Treasury to pre-
pare and provide for the redemption In this
act authorized or required, he Is authorized 10
use any surplus revenues. from timo to time,
In the Treasury not otherwise appropriated,
and to issue, sell, and dispose Of, at not less
than par, In coin, either Of the descriptions Of
bonds of the United States described In the act
of Congress, approved July IA, 1870, entitled
An act to authorize tho refunding Of the ma.
tioral debt with like qualities, privileges, and
exemptions to the extent necessary to carry
this act into full effect and 10 use the pro-
ceeds thereof for the purposes aforesaid"
In obedience 10 this provision, the Secretary
has sold at par, for coin, sl50O0,O0o four and
one-half per cent. bonds, or $5.000,0O0 during
each Of tho months Of May June, and July
last, and has sold $25,00o,000 at par in coin,
of four per cent. bonds, or $5,000000 for each
Of the months Of August, September, October,
November, and December. or the coin thus
received, - ,0OO, 600 have been sold for the re-
dcmption Of United States notes, and the resi-
due Is In the Treasury. Tho surplus revenue
haa ala, undor fba auf ifv haa an
piled TO horedemption Of the residue Of United
States notes not redeemed by the sale of coin
as above stated, and tho balance Is held In the
Treasury In preparation for resumption.
These operations, aided greatly, no doubt,
by the favorable condition Of our foreign COM
merce, have advanced tho market value of
United States notes to 97a per cent, or within
nearly 81 per cent Of coin. They have
also conclusively demonstrated the practica-
biiity ofrestoring United States notes to par,
In coin, by the time fixed by law, and that
without disturbing either domestic or foreign
trade or commerce. Every step has been ac-
companied with growing business, with the
advance Of public credit, and the steady appre-
ciation Of United States notes. Tho export Of
bullion has been arrested, and our domestic
supply has accumulated in the Treasury. The
expectation Of other domestic products has
been largely increased, with great advantage
to all industries. The course adopted under
the resumption act, rs herein set forth, II pur-
sued, will probably be followed with like
favorable results, and sufficient fund for the
maintenance Of resumption will doubtless ac-
cumuate in the Treasury at or before the date
fixed by law. The provision for free banking
has aided this process by allaying imaginary
fears that would otherwise have been aroused
by the withdrawal Of United States notes.
The Secretary canpot too strongly urge the
firm maintenance Of policy that will make
II. Ill. L.. a -
States notes when issued-a promise repeated
In the act ito strengthen the public credit"
approved March ls, 1869, and made definite
and effective by the resumption act.
Dishonored notes, less valuable than the
coin they promise, though justified by the ne
cessity which led to their issue, should be
made good as soon as practicable. The public
credit 10 injured by failure to redeem them.
Every holder who was compelled by law to
receive them has been deprived of q part of
his just due. Now, when our national re-
sources are ample, when the process of appre-
citation is almost complete, when the wisdom
of the existing law has been demonstrated, It
is the dictate Of good policy and good faith to
continue this process ofprepaation. so that at
or before the time fixed by law every United
State note will have equal purchasing power
with coin. To reverse this policy in the face
of assured success will greatly impair the public
credit, arrest the process of reducing the inter-
est on the public debt, and cause anew tho fl
nancial distress our country has recently suf-
fered.
The resumption act contemplatcs the reduc-
tion by the LIST day Of January, 1879, of the
amount of United States notes to $500, ,00O, 900,
by the cancellation Of such notes to the ex-
tent of eighty per cent. of tho circulation is
sued to national banks
The amount of circulation SO issued may not
be sufficient to accomplish the reduction con-
templated; the Secretary, therefore, recon-
mends that authority bo given to gradually
fund into four per cent. bonds all United
States notes in excess of $500, 900 OO0 the bonds
to be issued at par for coin or its market
equivalent in United States notes. This will
be in harmony with the declared object of ex-
isting law, and will open an easy way by
which the people may invest their savings in
public security. Or the reduction of United
States notes to the maximum of $500, 900, 900
may be accomplished If Congress will author
ize the coinage Of the silver dollar, to be ex-
changed for United States notes on the de-
mand of the holder, such notes to be retired
aud cancelled.
Existing laws do not clearly define whether
United States notes, when redeemed after
January 1, 1879, may be reissued. The
first section of the resumption act plainly pro-
vides for tho permanent substitution Of silver
coin for the whole amount Of fractional cur
rency outstanding. Section plainly provides
for the permanent reduction of United States
notes to an amount not exceeding $500, ,0O0, 600.
No distinct legislative declaration Is made in
the resumption act that notes redeemed after
that limit is reached shall not be &issued but
section 3579 of the Revised Statutes Of the
United States provides that "when any United
States notes are returned to the Treasury they
may be reissued, from time to time, as the ex-
igencies Of the public interest may require"
Tho Secretary is of the opinion that, under
this section, notes, when redeemed after the
LIST Of January, 1879, II the amount outstanding
Is not in excess Of $500 ,000, 600, may be reis-
sued as the exigencies Of the public service
may require. A note redeemed with coin Is in
the Treasury and subject to the same law as II
received for taxes, or as o bank-note when re-
deemed by the corporation issuing it. The au-
thority to reissue It does not depend upon the
mode In which 1t is returned to the Treasury.
But this construction is controverted, and
should be settled by distinct provisions of law.
1t should not be open to doubt or dispute. The
decision Of this question by Congress involves
not merely the construction Of existing law,
but the public policy of maintaining in circula-
tion United States notes, either with or with
out the legal-tender clause. These notes are
of great public convenieMce-they circulate
readily; are Of universal credit; are debt of
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