The Wheeling daily intelligencer. [volume] (Wheeling, W. Va.) 1865-1903, 1877-07-28
An Explanation Of the Present
Troubles.

An Explanation Of the Present
Troubles.
Mr.. Moilet, Of the Register, who is so.
journing amid the mountains OF Green.
brier, furnishes that paper with letter,
published in yesterdays issue, explana.
tory Of the present railroad troubles and
cOmmunistic uprisings throughout the
country. He proceeds thus learnedly to
explain the source Of thedifliCullies. lie
says that "Ony man who has studied the
philosophy Of our political condition
will concur with me when Estate that the
prime cause Of this uphesval OF Ameri.
can society can be traced to the one act Of
the governments exemptiHg United States
bonds from taxation" This act, accord.
ing to Mr.. MofIet, imposed the burthen Of
taxation "upon the muscle Of the coun.
try" and gave "violent shock to our 80
cial and financial system"
Mr.. Moiiet seems to be under the i'm.
pression that the bonds OF the Govern.
ment issued during the war, in order to
raise the means to put down the rebel
lion, we're arbitrarily and unwisely ex.
empted from taxation by an act Of Con.
gress. He does not seem TO be aware
that the securities issued by the U. $.
Government never were liable to taxation
at any time in the history Of the nation.
One would suppose from his remarks that
it required a special net Of Congress to
exempt them, whereas the act authorizing
their issue simply affirmed, for public in.
formation, the fact that II Government
bond could not be taxed by n State, coun.
ty or city, and did not engraft any new
feature whatever Of that kind in their
previous character. The Mexican war
bonds were not taxed or taxable by any
State, county or city of the United States.
Long before the war OF the rebel.
lion, the United States Supreme
Court laid down, through Chief
Justice Marshall, the decision that no
power inferior to the general government
itself could impose a tax on its bonds,
and for tho reason that il such a princi.
bic was once admitted the credit OF the
government could be at any time depreCiN-
ted and perhaps entirely destroyed, by any
recusant state OF the Union. The source
Of power in a government is It's credit
its ability to command the sinews Of war
and this power would be gone il in
times Of domestic instruction or foreign
invasion State, or county, or city could
lay tax upon the issues Of the govern
ment put out to raise money with which
to place troops in The field.
There has been persistent effort made
by the Democratic party in certain
states-nOtably in West Virginia-toin.
flame the prejudlces Of the people
against the holders OF government bonds,
and time and again the attempt has been
made To arraign the "bloated bondhold.
etS" before the public IA enemies Of our
National prosperity. Many nninformed
persons regard the bondholders as II privi.
legged class, who by M unjust act Of Con.
greSs enjoy an unrighteous exemption
from bearing their share Of taxation.
They never stop TO think that in their
very nature n government bond cannot
be taxed by any other power than that Of
the Federal government. Ii wonld mean
the possible overthrow Of the government
in some great emergency like the late re.
bellion to admit the right Of q State to
levy ajax on the government securities.
The government iAcli can tax its own Sc
Cnritier, md did 30 all through the con-
tlnuance Of the income tax. When the
taxOn incomes was abolished the tax on
bonds went with ii, md there is no tax
now III force upon bonds simply because
the incomes of the people are not taxed
We have always held that it was bad
policy on the part Of the government 10
let go that tax. The tax on incomes over
5000 should have been kept up, but it
has been the policy Of the government 10
reduce taxation in every direction, and
to collect nearly all Of Its revenue
from the manufacture Of three or
four articles, such as whisky, beer
tobacco aud cigars. To have
kept up tax on government bond
alone, as an income tax, would have beer
very unwise indeed, fer the reason that i
would have deprecated every new issu,
which the government might desire t,
put out in order to redeem its old bonds
In other words, such a tax would hav
produced no income, II thus levied as
separate tax, because the bonds wouI,
nave been discounted just that much il
tue markets Of the world a. compare,
with other securities bearing n higher rat
otinterest. When man buys bond, h
buys it with reference 10 i,s producip,
power in the way OF interest, and its pric
iSregulated accordingly. For instance, III
city Of Wheeling has just issued six pe
cent bond, free Of city tar, wherowi,h I,
take up debt on which ii has been pay
ing s per cent interest. Why did it cx
empt the funds from city taxation
Simply to induce people to pay par 10
them. Otherwise they would not hav
brought par in the market. So that, i
eject, the city has really collected 8 to l
per cent tax on said bonds in advanc,
lt'has, in other words, got that muc
more for It's bonds.
Mr.. Moastis greatly mistaken when b
ai'rlbutestO the untaxed issue Of Gov
ernmGnt bonds the origin Of the presen
'ronbles. 1t has had very little to d
with nnr diifinnltiaa aYoo,. =. ,l.,......