The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1877-12-05
wEpNEspAY MoRNrNe. DEC. 5.

&c 9Dit tSiVVV' -1G6 secretary earnestly utkoS
upon Congress TO give its assurance thst the IN
tsrest aud principal Of these bonds snail be
PAID IN gold coin, aud says that u IS undoubt-
edly the general conbdenee felt that so
1ust a principal OF good talth would obtain
that has MADE their sale 40 successful, The
Secretary does not doubt that il no question
had arisen disturbing the pablo credit the SIX
per cent. bonds would be rapidly paid off by
She proceeds Of the four Der cent bonds sold
at par in coin, or its equivalent At a time
when we are enjoying the highest credit, aud
rapidly securing the benefit Of il by the reduo-
ton Of the rate of interest from six to four
per cent. 10 wOald seem to be grievons error
10 raise a question about the coin in which the
interest is payable. Self interest alone, with.
out respect 80 pride in public credit would lead
US 10 secure 80 great benefit as would be the
saving Of one-third Of the interest Of the public
debt.
If public interest demands the issue of the
silver dollar, the Secretary submits that aa exc
press exception be made requiring that gold
coin alone shall be paid for principal and lnter
est on bonds issued to public creditors, since
Feb. II. 1873. the amount of which is $780,
800 700.
These bonds have entered into the markets
of the world, If the market value of the silver
in the new coin is less than the gold dollar,
forced payment in the new coin is a repudia-
ton of part of this debt. The saving that
would thus be made is utterly Insignificant
compared to the ni0ry done to the public cred
It, And even as to bonds issued prior to Feb.
IL, 1873, public policy and enlightened self-in-
tervst require US to pay them 10 the coin then
in circulation and contemplated by both parties
as the medium OF payment. Silver dollars have
not bsen in circulation in the United States
since 1887, and since 1858 fractional silver coins
have been 10 circulation and a legal tender only
for limited sans, and have not been contem-
plated as the medium of payment since any
considerable portion of the outstanding bonds
were issued. The silver dollar was in fact, more
valuable than tbs gold dollar. 1t does not be-
vatsA r.. sNaa1e 49,
ket depreciation of silver to gain small saving
by the payment of silver dollars instead of toe
coin contemplated when the bouds were issued.
A far greater saving and higher public honor
can be secured by the sale of four per cent.
bonds under the refunding act and the payment
of outstanding bonds 10 gold coin. An assur-
ance given By Congress of such payment would
at once secure the complete success of the re-
funding process and greatly advance the pres
ent high credit of the United States.
Another practical impeachment in the sale Of
bonds was that, under the law, the secretary
could receive Col alone in payment for them,
and the only existing coin that could be rs
ceived. under the law, was gold coin. As this
was not 10 general circulation it was impract-
cable for the people to pay it into the treasury
for these bonds. Therefore, it became neces-
sary to conduct all sales through third parties,
who could receive bank bills United States
notes. drafts, certificates and other forms of
commercial paper, and convert them into coin.
The Secretary, therefore recommends that he
ba authorized to sell such bonds either for coin
or for its equivalent in United States notes.
RESUMPTION OF SPECIE PAYMENTS.
The Secretary says that the practicability of
restoring United States notes to par with coin
the time fixed by law is eonclusively demo-
ated by operations under the resumption act
during the past year. Every step has been ao-
cornpanied with growing business, with the
advance of public credit, and the steady sppre-
citation of United notes. Tbs export OF bull
lion has been arrested, and cur domestic sup
ply has accumulated in the Treasury. The eX-
portation of other domestic products has been
largely increased, with great advantage TO Rli
industries. The course adopted under the re-
sumption act, if pursued, will probably be fol-
lowed With ike favorable results, aud q sniff
Gent fund for thief maintenance of resumption
will doubtless accumulate in the Treasury at or
before the date fixed by law. The provision
for free banking has aided this process by al
Is; lug imaginary fears that would otherwise
have been aroused by the withdrawal of Unit
ed States notes.
The Secretary cannot too strongly urge the
firm maintenance Of 8 policy that will make
good the promise contained in the United States
notes When issued--a promise repeated in the
act 'to strengthen the public credit" approved
March Is, 1859, and made definite and effective
by the resumption act.
The Secretary recommends that authority be
given to fund into four per cent. bonds all Unit
ed States notes in excess of $500 000, 600, the
bonds to be issued at par for coin or its market
equivalent In United States notes, in order to
assist the reduction contemplated by the re-
sumption act, and which may not be accom-
plished by the cancellation of such notes to the
amount of 80 per cent. of the circulation issued
TO national banks. Another way of accom-
plishing this reduction is BY coming the silver
dollar TO be exchanged for United States notes
on the demand Of the holder, such notes 20 be
retired aud cancelled.
The Secretary Is of the opinion that under
the resumption act notes when redeemed after
the first of January, 1879. if the amount out
standing Is not in excess of $500, 000, 900, may
be reissued as the exigencies of the public ser
vice may require. But this construction is con-
trover oed and should be settled by distinct pro-
visions of law. The Secretary argues that bis
construction of the law is in accordance with
public policy and convenience. He thinks the
best currency for the people of the United
States would he carefully limited amount Of
United States notes, promptly redeemable
presentation, in coin, aud supported by ample
reserves of coin, and supplemented by system
of national banks, organized under general
laws, free and open to all, with power to issue
circulating notes secured by United States bonds
deposited with the government, and redeemable
on demand in q. 8. notes or coin. Such a
system will secure to the people a safe currency
of equal value in all parts of the country, re-
caivable for all dues and easily convertible into
coin. Interest can thus be saved on so much of
the public dsbt as can be conveniently MAIN
tanned in p rmanent circulation, leaving to ma
tionsl banks the proper business of such COR
porations, of providing currency for the vary
ing changes, the ebb and flow of trade and
that the suspension of their redemption be au-
thorized under certain circumstances.
NATIONAL BANKS.
Under this head the Secretary calls attention
to the report of the comptroller, of the cur
reucy, especially to what is said by him as to
the repeyl of the tax on deposits. While the
necessity exists for collecting the amount of
revenue now required the Secretary is not pre-
pared to recommend such repeal. but whenever
sufficient amount of revenue for the support
of the government can be derived from the
other articles now subject to taxation, re-
duction of bank taxation will be advisable The
redemption of bank notes in U. s. notes at the
Treasury, under the present system is great
convenience to the public and should be con-
tinued.
SAVINGS BANKS.
Under this bead the Secretary recommends
that authority be granted to issue certificates
for small deposits, convertible into four per
cent bonds now. authorized by law, the pro.
ceeds to be used solely for the REDEEM tion of
bonds bearing higher rate of interest, and
now redeemable at par.
COINS AND COINAGE.
The Secretary recommends that the limita-
ton upon the amount OF fractional coin to be
issued in exchange for United States notes
should be repea ed. He also recommends the
issue of the silver dollar, with such legislative
PROVISIONS as Will MAINTAIN its current value at
par with gold. This coin, however, should be
subject 10 the same rule as to issue and con-
vertibility rs other forms Of money The Sec
Rotary argues at length the question Of free
coinage of silver and urges upon congress the
serious objections to ii upon such conditions as
will demonetize gold, greatly disturb all the
financial operations Of the government sudden
ly reveluiionize the basis Of our currency,
throw upon the government the increased cost
of coinage, arrest the re-fundng,of the public
debt and impair the public credit, with no ap-
parent advantage to the people at large.
The Secretary believes that all the beneficial
results hoped for from lbsral issue of silver
coin can be secured by issuing this coin in pnr-
susnee of the general policy of the act of 1853
in exchange for United States notes, coined
from baliion, purchased in the open market by
the United States and maintaining it by re-
demption, or otherwise at par with gold coin.
1t could bs made legal tender for such Sums
and on such contracts as would secure to it the
most general circulation. IL conld be easily
redeemed in Upitef States notes and gold coin,
and Honly ressued when demanded for public
convenience. If the essential quality of re-
deemability given TO United States notes, bank
bills, tokens, fractional coins and currency
maintains them at par, how much easier it :