Evening star. [volume] (Washington, D.C.) 1854-1972, 1878-09-06
TnENT
Clear Showing OF the Financial Con.
diliOn and Prospects Of the
COnmfrv.

~
IDENT.
Clear Showing OF the Financial Con.
dtltOn and Prospects Of the
Country.
President Hayes made an important speech
at st. Paul, Minnesota, yesterday, at the fair
finances comparing them with their condition
at the close of the war, showing the decrease
of the public debt, the decrease in the interest
paid, and that only One-Sixth of the bonds are
now held abroad, whereas In ISL from eight
hundred to one thousand millions were owned
by foreigners. He also dwelt on the balance
being in favor of the United States, and drew
the happIest conclusions from that fact. He
eminent of the United States is shown by
its debt, its receipts and expenditures, the
currency and the stale OF trade with
present state of the puolc debt. Tne aScer.
tanned debt reached its highest point soon
after the close OF the war. in August, 1855.
to this it was estimated that there were enough
unadjusted claims against the government, Of
unGuestl" lon validity, to swell the TOTAL debt
buiden was one of the gravest Questions
which pressed for decision as result of the
war. 1t will be remembered that in important
speeches, and in the public press the opinion
was confidently declared that the debt could
never be paid; that great nations never did
pay their war debts; that our debt would be
ike that o. Engiand-permanent and bur
den upon ourselves and our pOSterity for all
time. Some advocated and many feared re-
quotation. There We're those also who thought
national debt was national blessing. For
tunately, however, the eminent gentleman at
the head OF the Treasury, Mr. Hugh McCul-
loch did not hold these views He believed aud
the people believed that the debt was not
blessing, but burden, and that it ought TO be
and could be honestly paid. Tue policy
adopted was to reduce the debt and there.
by strengthen the public credit, 50 as to
refund the debt at lower rates of interest Ard
now i've you the results. The debt has been
reduced until now IL is only 3, 035. so 32i So.
This IS reduction as compared with the as
2it.5S. More than one fourth of The debt has
been paid off in thirteen years. If We com
pare the present debt with the actual deD5
s3.WooOo,0o0, the reduction amounts to about
Sl,Wt,O0l,0OO, or 0ne-third of the total debt.
mus 1t has been demonstrated that the United
States can and viii pay the national debt. Ed
cOuraglng as these facts are, they do not fully
show the progress made in relieving the cou1-
try from the burden of its wsf debt. All who
have to borrow money to carry debts know the
Importance of the question of interest The
total amount OF interest bearing debt at the
time it reached its highest point. the 3lSt OF
August, 1865, was as follows:
-Four per cent. bonds S61S, l27 9S; five per
cent. bonds, 1868, 10, 12l65; six per cent bOndS
Sl,oa,7l2,27933; $40 United States notes,
SS3O,U0oOU; compound interest notes, six per
cent, Sll ~. 100; total interest bearing debt,
s., 3Sl $50 ,294 96.
The total annual interest charge amounted
to Sl50,9U,6 9lS This Was an oppressive bur-
den. For interest alone we We're paying more
than double the total current expenses of the
government in any year of peace prior to the
war for the Union. With such a burden for
that the debt could never be paid. But as we
have seen, better opinion prevailed. Those
who believed that by strengthening the ma
tional credit the rates of interest might be re-
duced were sustained by the public Judgment.
The ability and the purpose to pay the debt
according TO its letter and spirit were demon
Strated. 1t was seen that the successful m In
agement of the debt depended on the rates of
interest to be paid that a reduction of one per
cent. on our whole interest bearing debt would
be ayearly saving In interest OF over $40 00000o
that reduction of two per cent. in the rate
OF interest would save to the country over
100000, which is the interest at four per
cen ds en- 81 oo The policy Of reducing
credit having been adopted, let us observe the
result in the present condition of the public
debt with respect 10 interest. The total in
tereSt- bearing debt August l, 1878, was as fol
loWS:-Three per cent navy pension fund
GA, OOO, 600; four per cent bonds, sll2 S5O,OOl;
four and half per cents, s246, OOO00; i've per
cents, sos, 266 $50: six per cents, s33 56 ,5O-
total present intereSt- bearing debt, 81 Sy9 677-
800, the interest On which amounts to the sum
OF So, so per annnm. 1t thus appears
that in thirteen years the interest bearing debt
has been reduced from 1891 so, $50 s. to
l.SO9,6T7,9 Q, a gain in the amount of the in
teresE bearing debt of s57l, 49,, 1874 So. The re-
dnction a. OF the annual interest charge is
5,796, $50 "a. or more than so per cent of what
we now pay. If the reduction of annual in
ferest were placed in a sinking fund at per
cent. interest," 1t would pay of the whole debt
In less than twenty five years.
Ihere had been another gratifying and
important improvement in the state of the
public debt. A few years ago our bonds were
mated that in ISL from 800, oo,oJo to
81, 0Oo0 600 were held abroad. We then paid
from $50, OOO. WOtO 81, 900 annuallytO Europe
for interest alone. Now the bonds are mainly
held in our own country. 1t is estimated that
five slxths OF them are held in the United
States and only one sixth abroad. Instead Of
paying to foreigners $5O.pO0000 we now pay
them only about sl2 900 900 or ST., OOO, 600 year
and the interest on the debt is miinly paid to
our own citizens: Il appears from what has
since the panic of five years ago, there has
been great change in the condition of the
debt. The change has been one of improve
ment: First-The debt has been greatly re-
been largely diminished. Third-And it is to
be paid at home instead of abroad.
"Ihe Burden u taxation Ia. been reduced
lows: The taxes in $3.50 were: Customs, sl79,-
ei665l 50; internal revenue. 1909. 26,Sl342; to-
tai s4SS 273 ,465. The taxes In 1873 were: Gus
Tens S IS. s,o 81 internal err revenue, sllo
taxation since 1866. s247, so, 1906. Taxation
the year of the panic, 1873, customs, slSS, 0S9,-
5 5221 - internal I revenue slls 729 BAH; total
since the panic, 61,O66, $3.50.
THE expenditures have been reduced since
the end OF the war as follows: 1867, exDendi-
lures, including pensions and interest, $751;.
542,67516; 1873, expenditures, including pen
siOns and interest $l36 ga, 32S 80; reduction of
expenses. $120, 57S 3iS So; expenditures the wear
OF the panic 1873, $290, 3l5 2i5.33; 1873, $236..
964,326.SO; reduction in five years, $50 $50 9lS-
53. The Improvement in the currency since
the close of the war has been very great In
1865 the paper currency of the country consist
ed Of greenbackS, 1872 757 .64: national bank
notes, $lI6, 2l3955: fractional currency, Sl6-
S4,1i2; old demand notes, $i02, 9j5: trea Surv
notes, compound interest notes and state bank
notes, estimated ar Sl00,N4 0la: total S-}l7l9-
= d. It's va 'ue was 50 3 100 cents on the dollar
III coin, and it, rOial value in coin EaS $3.50
1850 IL. In lS,S "ur paper currency co insists
OF green backs. S}.G,6Si, DC: national bank
notes. 1924 5l424: fractional currency, So
5f.l6S.T; total, $iS., 7t3 1887
Each dollar OF paper currency is now worth
S91 cents In coin, and the total value in coin of
our paper currency Is more than So3i,0p0 Go
The value of the paper dollar Is as stable as
that OF coin. Coin and paper are practically
abreast OF each other. The luctuation in tina
value OF the paper dollar has not in the last
five months exceeded the fraction of a cent.
The total increase in the coin value of our
paper currency since 1865 is about sl75. OOO 900.
NOth1ng connected with the financial affairs
OF the government is more Interesting and in.
Struct1ve than the state of trade with foreign
countries The exports from the United States
curing the year ending June SO, 1878, were
Larger than during any previous year in the
history OF the country. From the wear 1863 to
me year 1873 the net imports into the United