Clarksville weekly chronicle. (Clarksville, Tenn.) 1873-1890, 1877-05-19
A MARYLAND VIEW OF OUR STATE
DERT.
baltimore Sun.

is The large amount of Tennesse
w bonds held by Marylanders make
is it a matter of special interest t
w watch and report upon the feelin
~ in that State in regard to the propC
f sition for refunding them in ney
Al bonds at the rate of sixty cents OF
q. the dollar. The trustees of the Pea
,f body Institute in this city hold, a
= one of the latest gifts Of Mr.. Pea
N body, no less than 1854, 900 of thes
If bonds, estimated at their par value
y That patriotic and philanthropi,
o American, in connection with thi;
= gift, expressed his confidence in thu
+ ultimate payment of the debt il
i full, advising the trustees therefore
y not to dispose of the bonds. Yef
q there have been meetings in thai
4 State recently proposing to pay only
) forty cents on the dollar; but we
: are glad to see the explanation in
quarters favoring the support OF
2 the State credit that the one or two
meetings of this sort were insignifi-
cant in numbers, and it was doubt
? full if the resolutions We're really car
ried.
, The greater part of the debt of
{ Tennessee was incurred in the con-
structiOn of railroads. Some of them
f have done well, some badly, while
some remain to this day unfinished
, and comparatively worthless. To
, build these roads the State issued
her own bonds to the companies
constructing them, taking a mort
gage on each line and binding the
companies to pay the interest on
the bonds. But in 1870 the several
companies were authorized to dis
charge their Indebtedness to the
State by the payment of its bonds
into the treasury at par. In 1871
the total amount of the State debt
was $38, ,945, ,852. AT that time eight
of the railroad companies paid the
interest regularly on $15, 155, 130 of
the State bonds issued to them.
The total Indebtedness of the re-
naming roads was then $21, ,2O3, 1856,
but their estimated value had de-
clined to $11, 100000. These rail-
roads were in default, and i'm 1872
the State failed to pay the interest
on her bonds, including even that
portion on which railroads did pay.
! Whether there was any purpose in
this we will not say, but it is a fact
that the depreciation consequent
upon these defaults enabled the sol
vent railroad companies to buy up
the bonds at low figures, and thus
liquidate in part the claims of the
| State against them. By these pay
ments and by the sale of roads in |
default the actual debt of the State |
was reduced from $3S, ,945, ,S52, in |
1871, to $40, ,3S2.14, in 1873
Nevertheless the Legislature of that |
year passed law providing for the |
funding in six per cent. bonds the |
past-due coupons, and also the cou-
pons maturing on or before the 1st |
of January, 1874. This was acqui-
esced in by the bOndholders in the |
expectation, if not assurance, that
thereafter the Legislature would |
levy sufficient tax to regularly pay
the interest. There has been a most
wanton disregard of faith, however,
in the matter. Tennessee never
having levied a tax even equal to
that of the State of Virginia, though
she has much larger property ba-
sis than the latter, and more varied
and, in the aggregate, valuable pro-
ductiOns. Only two coupons were
paid as due after the funding, those
of July, 1874, and January, 1875.
When the subsequent July coupon
matured the then Governor, Brown,
found, by reason of the Inadequate
levy, not a sufficient amount of
money in the treasury for its pay
ment, and it laid over unpaid until
September of 1876, when he, not
withstanding some outside opposi-
ton, announced that sufficient funds
were on hand, and entered upon the
discharge of the past due obligations
of the State, signifying at the same
time that payment on the other
coupons that had meantime ma
tured should also be made whenever
sufficient means were on hand. The
Legislature, however, of the follow
ing January session, took efficient
measures to Stifle any such honest
impulse as this by passing resolu-
tiOns forbidding any further pay
ment of interest till ordered by that
body. The same Legislature before
adjOurning also reduced the already
inadequate State tax, as if really de-
signing to further depreciate the
State securities with the view of
driving a hard bargain with her
creditors.
The total debt of Tennessee, ac-
cording to the COmptrOller's report
of January, 1877, was at that date
$22, ,852, 900, less SO, ,458, 145 due by
solvent railroad companies. The
assessed value of real and personal
estate in Tennessee in 1876 was $278,-
020. .534, and the rate of taxation 40
~ 10 |
estimated receipts for 1877 from all
sources would be 81, 1916, 400. The
estimated ordinary expenses were
S707 200, leaving 1868, ,290 applicable
to the payment Of interest on the
State debt at the old rate of taxation
the payment of interest in full re-
quiring a revenue in excess of ordi-
nary expenses of about 81, 100000.
An additional tax of two mills
would have provided for the def
cheney and enabled the State to pay
the interest annually on its bonds
in full. Nor would this be a serious
burden, for, of all the older States of
the South, Tennessee suffered least
from the waste and ravages of the
war. That she suffered greatly in
common with her sister Southern
States from the loss of her slave
property there can be no doubt, but
comparatively speaking her mate
rial interests were less affected and
since the war she has not been robbed
by carpet-baggers and other thieves
as have been other of the States.
Yet, granting that she was impOv-
erished, it is no less true that the
State is rich in resources. 1t pos
sesses a fertile soil and a vast
amount of mineral wealth that needs
but proper development to become
an important source Of revenue. 1t
could carry debt of $40, 900, 900 ca
silly if the people were persuaded
that it concerned the honor and the
credit as well as the welfare of the
State to make the effort.
Besides the reluctance to increase
the levy in Tennessee, there has
been criminal neglect in collecting
taxes on property assessed. But
perhaps the most serious cause of
all in making Tennessee a default
ING State is the interest that the sol
vent railroad companies have had
in depreciating the value of the
State bonds. These companies, ac-
cording to the last report of the