Watertown republican. [volume] (Watertown, Wis.) 1860-1906, 1877-10-17

that which prompted men to give them
selves or their sons to die on the battle
field. Many were taken by the poorer
classes; Mr.. Lincoln dwells on this fact,
III his messages to congress, as imposing
peculiar obligations to economy in
expenditures andeto energy in action"
In those days of wild speculation and
rare opportunity, there were abundant
methods for far more profitable invest
ment than in the obligations of the gov
eminent They were issued as a neces-
sity, they were bought largely by those
who fully appreciated the needs of the
government, and it is a great wrong
almost a crime-to class the public
creditors of that time as public enemies
now. If they or others, had not came
forward with their money, either the
government would have persisted, or
survived, not as the temple of liberty,
purified and reconstructed, but only as
a monument of failure, a broken union,
a divided country, with standing armies
perpetually facing each other along the
line separating the shareholders des-
potism from all that was left Of the proud
republic founded by Washington and
his associates From such disaster
our improvised financial system saved
us, and every patriot should join in the
sentiment: God bless both the govern
ment which issued bonds for this holy
purpose, and the people who bought
Them"
WHY THE BONDS ARE NOT TAXED.
But it is said that while the purpose
was good for which the system was de-
vised, it contains many bad features,
advantageous to the rich and both OPP
pressive and unjust to the laboring elias
ses. First on the list of this class of OBJ
jections in the cry that it has created
"an untaXed bondholding aristocracy,"
as if the exemption of United States
bonds were ''new departure" in the
financial history of the country. This
charge is of the very essence of falsehood
or of ignorance. The government had
repeatedly issued bonds before the war,
and they were Meier subject to taxation.
They were always exempted. The
necessity and justice of this rule
was established more than fifty
years ago by the supreme court of the
United States, Chief Justice Marshall
announcing the decision in an elaborate
opinion. The soundness of his conclll-
slons no respectable lawyer or intelli-
gent man will question: The reasons
for such exemption are these The
government is not expected to incur
debts except in exigencies when its ex-
penses are greater than can be met by
its available revenues. To tax the
bonds is simply a mode of reducing the
interest. For the government to tax
them would involve the absurdity of it's
paying out the interest and then collect
ing back a part oft How much better
to make the interest as low as possible
at first, and avoid the expense Of col
lecting the tax. Further, if it permitted
states and municipalities to tax It's
bonds they would have a practical veto
on It's constitutional right to borrow
money. A state by levying high tax
on such securities could prevent their
sale within its limits. Such power
would be inconsistent with the sover-
eighty of the national government.
Suppose it had been possessed by the
municipal authorities of New York city,
VIGOROUSLY in sympathy with the rebel
lion during the war; it Is extremely
probable that by such taxation they
would have destroyed that market for
United States securities
Whether this rule Of exemption be
good or bad, it is one for which our
present financial legislation is not at all
responsible. 1t is one which the trainers
of our present system found already es-
tablished 1t has it's origin in the con-
stitution, and those who charge republi-
can legislation with creating an untaxed
aristocracy of bond-holders are either
ignorant of the laws and history of the
country, or they are demagogues seek
ing to deceive and mislead the people.
THE CHARGE THAT THE BONDS WERE
ORIGINALLY PAYABLE IN GREENBACKs
Another favorite charge of the Green
back leaders Is, that our interest bearing
debt was originally payable in Green
backs, that Congress afterwards repealed
that law and pledged their payment in
gold An examination of the statutes
and the decisions of the Courts will
show the falsity of these assertions.
The basis of our present financial sys-
tenn Is the Legal leIluef AcC OF req. 70.
1862. 1t authorized the first issue of
legal tender -Greenbacks- of
$40 bonds. Upon these bonds the Ma
tional bank circulation is founded,
which, with Greenbacks, constitute the
chief currency of the country at pres
ent Now the Legal Tender Act no
where says, directly Or indirectly, that
the bonds may be paid in legal tender
notes. If the law can be so construed
it must be some strained inference
drawn from other than its express pro-
visions Such is the claim, and it is
alleged that the clause Of the law max
ing Greenbacks legal tender for all debts
public or private except interest on
the public debt and duties on imports"
warrants the assumption that the princi-
pal of the public debt is payable in
greenbacks. But the Supreme Court
has decided that the term debt" as
here used, cannot be construed to mean
all obligations but merely current trans
actions among the people and between
the people and the Government. 1t is