The Dallas daily herald. [volume] (Dallas, Tex.) 1873-1887, 1877-11-28
MONEY QUESTION

SlG-As cmbtr OF the HEbup.
Nom correspondent Ela observed chat
youh .ft wogg aversion 90 govern,
meut Ouudrpd,H, from lhe fact 10 is
p,auurd that lhc bonds me eNcmp,
FROM MXntiou, The greatest iur',t
that America ever produced Chief
Justice NJ lshall, decided that govern
mout promises to pay were not taxable.
One OF the reGsons' given why they
should not be taxed, was that the gov,
ernment was never supposed to borrow
money except In eases Of grave noces'
eity and thea the government should
be- permitted TO enter the money
market on the most favorable terms,
free and unuameled II the states had
the power TO tax national promises 10
pay, they might use that power to such
IN extent that would virtually inhibit
the government from borrowing money,
thereby rendering the government in,
operative and powerless II the bonds
were taxable, the government would
have TO pay at least two per cent more
interest than we are now paying, let
s ae how this would work AT the
N g of the war, the government had
some two thousand million of bonds on
the market Two per cent additional
interest would have been forty million
dollars additional tax per aunum,
which would have fallen indirectly on
every citizen Of the United States the
rich and the poor the just and unjust
alike,
But says the advocate of greenbacks,
granting the states the power to tax the
bonds the burden of taxation would
Eventually have flllcn on the bond.
holders Tor the states would have tax.
ed them two per cent thereby making
the bondhoder pay the additional
interest.
But this would be robbing Peter to
pay Paul, for the states would only get
back what the citizens had already paid
to the national government, the two
per cent additional interest, and in some
States the amount of bonds held by the
citizens thereof being comparatively
small, they would get back but little
from the boudholder, while the citizens
would have to pay their full share Of the
national tax on everything they con.
sumed. But this is not ALL More than
one half of the national bonds are held
abroad where they could not be reached
by taxation, hence we would be paying
the foreign holders of our bonds an
extra twenty million dollars per annum,
from which we would obtain no return
Whatever.
Then to sum up 1t national bonds
were taxable the government would
have to pay higher rate of interest,
and if the tax laid on the bonds was
greater than the additional interest the
bonds would be driven abroad, and we
would have the pleasure of paying an
extra tax for the especial benefit of for
eigu capitalists,
There is still greater reason, founded
on common sense and equity why
promises to pay should not be taxed.
Promises to pay are only evidences OF
Indebtedness, and evidence of indebted
ness is not property, while property
alone should be subject to taxation.
The burdens of the debtor are sulii>
GENTLY great without making him pay a
tax on his debts, which is the ultimate
result Of taxing any species OF lndebted>
ness.
The supreme court of California has
decided that mortgages are non-taxable,
and it is safe to say that the time is not
far distant when evidences of in
debtedncss will not to be taxed in any
state of the union.
Although the greenbackers are so
very indignant at the national bonds
being non,taxable, yet no one ever
heard them utter single complaint at
greenbacks being exempt from taXa~
ton. If your humble correspondent
had one million dollars in greenbacks
he would not pay dollar tax thereon,
rs the supreme court Of the United
s States has decided that they are non,
taxable. The man OF wealth is called
many hard names for investing his cap>
ital in government bonds, but wherein
is the difference between a, who bags
fifty thousand bonds, and B, who bags
fifty thousand dollars worth OF real es
tate? The one lives on the interest OF
his bonds while the other lives on the
rents of his real estate. The fifty thou>
sand dollars A paid for his bonds con-
tinue in circulation as much as the fifty
thousand dollars that B paid for his
real estate. The circulating medium is
not increase.l or diminished by either
transaction. The secretary of the treas
ury is now selling four per cent bonds
at par in gold, aud with the gold thus
Obtained is calling in aid destroying
six per cent bonds, or in other words,
he is exchanging four per cent bonds
for six per cent ponds without paying
any difference thereon, thereby reduce
ing the interest on the national debt
twenty thousand dollars for every nils
lion of six per cent bonds thus called
in. 1t is a shameful thing for him to
do, and as consequence the greens
hackers are calling him every ugly name
that they can think OF.
Your correspondent cannot under
stand how it is that The HERALD
that is so strongly opposed to bond
holders and "bondholders legislation
is in favor of the government issuing, oil
endorsing, which amounts to the same
thing. seventy or eighty million oil
bonds to the Texas and Pacific railroad
company. thereby increasing the army
of bondholders to that extent 1t l,
claimed that the bonds would be sold
in Europe, thereby increasing our cir
culating medium to the amount OF
bonds thus sold. If the bonds were
sold in Europe the interest would be
naid there also, but the sale of th'
brnJs would not increase the circulating
medium single dollar, as they have
no greenbacks in Europe, and goll
does not circulate in the United States
This is one of the beauties of the green
back system; if our currency mad