The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1878-04-05
Course Of the Department in
the Use Of Silver.
The DEFICIENCY IN THR SINKING FUND
The Light Of Experience Thrown on
Extreme Suggestions.
EFFECT ON THE NATIONAL BANKS


the House COMMITTEES on BsnkinR and Curreacy IN
regard 70 the Resumption act was resumed to-day.
II opened with comparison between the ability Of
tho government to resume and maintain specie pay
nsas and that Of tho Bask Of England tho Secretary
insisting upon u that the government was in an
equally good II not better condition than the Bank
Of England. After this point had been thoroughly
exhausted Mr.. Ewing asked the Secretary how be cx
pccted 10 got tho additional millions OF gold which
no required by the LIST OF January, 1872
Secretary SHKRxAx-You must sec that for mo 10
state 100 closely what propose to do might prevent
me from doing what expect to do, and therefore l
will answer your question Just as far think you
win say ought TO 90. l answer. mainly IRON the
sao OF bonds indeed, In the present condition OF
tho revenue. We cannot expect much help from sur
plus revenue except so Tar that surplus revenue
may be applied 10 the payment Of greenbacks and TO
tho redemption Of fractional currency IN
aid Of tho sinking fund. To that extent /
think we can rely upon revenue enough to
retire the United states notes redeemed under
the Resumption act, SO that would say that we can
get the fifty millions OF gold additional by the sao OF
bonds. Az to tho kind OF bonds that would SELL and
as to how would sell them, &C., ought not to say
anything on that subject at present. because you
ought to allow me as executive occr the cxer-
OF very dolicate discretion free power to act as
for my action afterward Asto what bonds will sell,
or where will sell them or how will sell lhem, as
that discretionary power left with the Secretary
ought not TO decide that now but 10 decide a. the
case arisos.
SOURCES OF COIN SUPPLY.
Mr. EwIxo-I understand you TO say In your inter
Wow with the Senate Committee that you would have
to rely upon the natural currents Of trade enable
you SELL that IT. that there cannot be largo sale Of
bonds for coin abroad II Is not on foreign sale that
Mr. snERMAs-Not at all. but on a ,slo q, home
Perhaps ! might as we'll say shat II can got two.
thirds Of this years supply Of gold and silver IL viii
amount too good deal more than $50 600 ooo that
do nos have 10 60 abroad for GOLD. II wo keep
our own gold and silver from going abroad u IL more
Tho CnAlnnAx-For this $50, ooo, 900 additional 1
suppose you rely 70 some extent on the ooinago Of
COLO We consider the same under the Inv.
THs USE OF SILVER COIN.
Ant. Ew,sc-Do you expect to pay out the silver
coin Liabilities or 20 hoard for resumption
Secretary sHsRAAE-l expect 70 pay 4 out only
perfectly rce answer the question fully because on
that point, altcr cUasuising with many nrmvcrs Of
requires mo 10 do propose 70 ISSUE ali The silver
dollars that are demanded In exchange Tor gold
has ss:n sns On
usc the silver in payment for silver bullion, which
can do At par In gold without any loss after tho
was mado In the Silver bn. l thon troposo 10 buy
ali tho rost OF the silver bullion which need under
the current OF pusi3css, OF that SILVER
COIN will 90 into circulation; how much, DO not
take viii po Transferred To- ,es Trosu 81
silver cortifcates that seems 10 be tho Idea
s the S ana hcro silver
OF duties and In that way practically the SILVER viii
bslong 10 tho government again. Unsil silver is
coin transactions we cannot pay out that silver for
the Ordinary expenses the government because wo
have not enough TO pay all tho expenditures in silver
and II tho silver Is maintained pur with
gold, and " tho United States notes arc DO.
low par with GOLD. wo cannot aisermina,e
therefore have 10 hold silver at par with gold until
either have enough TO pay everything with u. or until
and silver. That Is matter over which navo
more control than other citizen The silver dollars
be converted into certificates which receivable for
customs-l must receive them; and could not pro-
ury, other Tor silver certificates payment oil duties
As 10 when snail commence paying tncm out Tor
tho current expenditures OF the govornmsn or IN pay
mont OF the interest or PRINCIPAL Of tho deot cannot
tell, because that would depend upon the equality
OF Tho three kinds Of currency-gold, silver ana
papor. do not know whether I make
myself understood, but tbat Is tho general idea havo
in my mind As a matter OF course. u bong great
discretionary power which you have invested Ia tho
Office OF tho Secretary OF tho Treasury, while hold
the office Will be very careful TO exercise that power
80 Is 20 carry out ~ good iah she law as Congress
has passed 10, and that Law, 1 think. contempIatcs
that gold, SILVER and paper shall DO all brough, ON
equivaIency.
TnK SINKING FUND
Coming TO tho question OF the sinking fund, about
which much had been said the last con renee
Mr Ewing put this question TO the Sccrctury -
Did any law onicer o. the govern msni or any Sec.
rotary OF the Treasury give written opinion to Tho
Ell ct that tho authority gwen TO tho secretary Of tho
Treasury by the resumption law, to- use any surplus
rcvcnuc from trc 10 tn6 IN Inc treasury not other.
wise appropriated 10 prepare and proviae Tor tho
sumption Of legal tenders, affect in any way tho oh.
legation imposed by that section oi tho Revised
Statutes winch dcc,nrcs that rho paid for Gus.
toms shall DO set apart special fund ard appiicd
tho sinking fundf
secretary snERnAS-No. think lha. no law oiIicer
Of the government or no Secretary OF tho Treasury
has yet actnortat,vely decided that question as you
put u now The question which the Secretary OF tho
fractional no,ea, beng art Of the public debt may
be included IN the sinking fund; and practicaiiy wc
that way and applied TO the sinking fund until last
year. In ono year In Mr. Bristow's time there was u
ssnoeSoy o. Goo and THIS ass year a,a 20,
the surplus fund; So that tho question which
you now present. although 10 Is presented
either by myself by any Secretary OF tho Treasury
or by any Law, Tor tho question has really never been
presented IN . way which made II necessary to &c.
edo H. My annual report viii snow the exact ap.
piication OF the amount Of tho surplus revenue. As
selling bonds under The Resumption act a,d not SEQ
my way Gear 10 60 into the market and buy these
bonds Tor The sinking fund. just during the whole
imperative; while wo werc actually selling bonds u
was absurd TOR as 10 20 into tho market and buy
bonds The money lies In the Treasury subject to tho
order OF Congress II Congress DIRECTS that Ave mid
IONS DO applied 10 tho sinking iund So but
II will only involve US Ia the absurdity that tho
English were involved 10 when they undertook to
carry out Sir William PITTS sinking Fund law during
their war.
Mr. EwiSG-But you can buy SIX per cent bonds
with IL ana you can sell tour por cent bonus
secretary snEnmAs-i know that. We can sell four
per cent bonds, but what Is the use oil dong SOL
MI EwfsG-What is tho balance ia the sinking
fund2
Secretary SHKRMAS-Fivs million seven hundred
ana sevcnIy-eight thousand dollars.
Mr. EwfSG-Whero is that In the Treasury7
Secretary SnEKhAx-lt IL IN tho general cash bal
ancc, IL ~ In tho coin accumulated. Mr.. Bristow IN
his report In 1875, mentions this very matter and
says that IN his opinion, tho law requires him call
IN bonds ana TO invest this money but Congress took
no action upon IL and the result that that year
or the preceding year. the balance toe surplus
revenue, some $1,000 600, was not applied at ALL and
SO, ever since the panic Of 1874 there has been a
balance not applied
MI EwIse-I don't think Tho surplus revenue has