Daily globe. [volume] (St. Paul, Minn.) 1878-1884, 1878-01-16
FOUR PER CENTS.
r1ls TO REFUND THE rUg11c DEBT.
Secretary sherman's scheme TO Localixe
and Popularsze Public Loan as Ex-
planned TO the Waya and Means Commit
tee.

WASHINGTON, Jan. 15.-Secretary Sherman
to-day appeared before the committee on ways
and means. He said it YVES known that there
had been syndicate for the sale of per cent.
bonds, but il reference to what was regarded
as q popular sentiment and also for
convenience of negotiation, it was deemed best
to terminate that contract and to place the
bonds on the market in somewhat different
plan, namely, to employ as far as possible all
national banks and bankers of established
credit who would give the requisite security. in
the sale of bonds to reach if possible, all class
es Of people, to treat them all alike, to allow
them the same commission to deliver bonds to
them in any part of the country free OF charge
and to invite popular subscriptions for that
purpose.
When, however, the treasury department
came to put that plan in actual operation, it
WAS found under existing lave, there were some
endorsements which, if congress should see
proper to remove. would enable it to very
largely increase the loan and to distribute it
more rapidly than it could be done at present
under the law az it now stood.
The secretary then proceeded to show the ex-
isting embarrassments, and presented to the
consideration of the committee draft OF 3
bill to promote the deposit of savings and re-
funding of the national debt. In commenting
gress would pass it he would be able to refund
the public debt very rapidly. and to carry ont
the operations of the treasury with increased
advantage to the public. He preferred this
mode to the one he had previously indicated for
a popular loan.
1t proposed that any holder of United States
notes may deposit them at any postal order
office in the United States. and shall be en-
titled to receive therefor. free of charge, q
postal order on the treasurer of the United
jStates, such postal orders when presented to
the treasurer at Washington in sums of $40 or
any multiple of that sum, shall be convertible
into certificate of deposit of the United
States of this kind and description provided
for in the bill. Such certificates may also be
issued in exchange for United States notes Mt
the treasury of tho United States or at the
Office of any assistant treasurer, or ut any
designated depository of the Uuited States
the certificates Of deposit TO be issued by
the secy of the Treasury of such form and
description us he may prescribe, and OF de-
nominations of Sly, $40, $50 and 800,
and to bear interest at the rate of 3.65 per cent.
per annum for the term of one year, and no
longer and shall be reserved and redeemed by
the United States, in payment only for bonds
and certificates which may be held by any
National Bank for that portion of It's reserve
not required to be kept ON hand III specie or
legal tender notes.
The secretary is authorized to receive either
y
Gates Of deposit, at their market value in coin,
in payment Of United States bonds issued I'M
der authority of law or in lieu of such bonds,
| registered bond or inscribed debt on the books
! of the treasury similar in character. Leaving
the interest to be compounded every Blk
| months, all United States notes received into
the treasury to be applied exclusively to the
| payment OF any bonds of the United States re-
deemable at the pleasure of the United States,
or to the purchase Of coin or bullion to be ap-
| piled exclusively TO the payment of such
| bonds.
| Several questions were asked by members OF
| the committee with regard to the true meaning
| and intent of this BILL among others by Wood,
chairman who inquired whether the Secretary
| did not think that certificates authorized to be
issued in lien of the postal money orders the
| bill called for, could not be used rs currency.
especially as the denominations ran down as low
rs FLO, and whether after the expiration OF the
one year in which they bore interest, they could
| not be used their par face value, with &C
! crned interest rs currency, precisely the same
us legal tender notes now are, and if this view
was correct, whether the effect would not be to
add six hundred millions of dollars to the
amount Of the ve-twentics yet unrefnnded, 10
the circulating medium of the country.
The Secretary replied be thought not.
Wood said: But after the expiration of the
year during which they we're entitled to dra"
interest, having in the meanwhile gone into
+
they might net continue to be issued as cur
reney and not he presented for redemption OF
conversion.
The Secretary replied they never could be
rconyerted into moro than Il 4 per cent. bond
and that they would be entirely presented fol
such within year.
The chairman said he understood that, bu.
the people did not receive any interest now or
United Etates notes called legal tenders. and i
holders Of these certificates choee to regard
them in that light and as currency, you would
hove no control over them.
The Secretary replied the difference would be
United States notes were legal tenders ant
these would not be.
Wood said the legal tender feature was mo-
of practical importance with regard TO a cireu
latig currency passed from hand to hand. w
have already q large national bank circulation
which is not legal tender by law, but yet it s
circulating medium of great value and gener
ally regarded as such. Now, the questio,
arises whether these certificates represented
generally by postal orders may not continue !,
circulation in the same way unless there b.
something in the act to prevent it.
Tucker, of the committee said as he under
stood the point Of the chairman, it was when
certificate ceased to bear interest they nigh
pass rs currency.
The Secretary asked: Is there any obiectio,
to thatl
Wood have not raised the question;
merely wanted to obtain your views as to tn
possibilities under your bill.
The Secretary referred to a feature Of tn
bill which he deemed of great Importance an
that was the French system of receiving money
into the treasury, recording them an in
scribed debt, and giving compound Interest
This was generally approved by the eommitte.
and after further discussion, in which Messrl
Kelly, Tucker, Bnrchard, Banks, Garfield an
others took part, the committee adjourned.
ReraIf nt Snoffed TniI Yudinn.