The Pulaski citizen. [volume] (Pulaski, Tenn.) 1866-current, 1879-01-23


be useertained and he courts opened for the
sale of the roads, and that so much of the
proceeds as arose from the roads built by the
postwar bonds would be paid on those bonds
and nothing more, and the remainder ap-
piled to the ante-war bonds.
When the election of 1863 demonstrated
that the right to vote and TO hold office was
about 10 be restored to the whole people, the
interest OF the solvent railroad companies and
the holders of the postwar bonds concur
ring, they made joint effort TO procure leg
islation allowing the solvent railroad compa-
MES 10 buy the postwar bonds and deliver
them to the State, and for every bond deliv-
cred to have the taxpayers assume one of
theirs. At the beginning of the session OF
ls69-lO bill was Introduced upon this sub
ject and passed the hOuse. In the Senate
there was able and unanimous report
jecting the bill. and by q decided vote the
Senate concurred in the report Subsequent
", by some means, the bill became law
But the bill that was passed was not all that
was desired. Although there had been no
investigation, IL believed that the post
war bonds had been illegally issued and sold
and fraudulently used, and Therefore the act
restricted the right of exchange 10 bonds
illegally issued
The postwar bonds, by reason of their in
hrmitles, were greatly deprecated, and al
though there were two grave questions Ia the
way OF the solvent railroad companies, yet
The speculation was tempting they deter
mined to take the chances. Tho first diIdcui-
" Was that a. the act restricted the right of
exchange TO bonds legally issued, and as
there had been no Investigation OF determi-
nation OF that question, it was uncertain
what bonds had been illegally issued The
other difficulty was that the holders of the
bonds issued to the several solvent roads had
a lien upon all the property and its usutruct
Of the respective roads for the payment OF
the bonds. and it was doubtful whether the
1aaa. IL H., Lot
The first question the solvent companies de-
termined TO decide for themselves; and they
decided that all the bonds were illegally is
sued', and the report of the Comptroller
shows they bought and paid IN the most OBJ
jectionabie bonds hTst, as they were cheapest
and this was done in great part before an in
vestigation was had.
This precipitate action upon the part of
the solvt Mt railroad companies seriously en-
barrassed the action OF the legislature, and
that embarrassment was augmented by
threatened military government, which was
then asked Tor by members in the Lower
House of Congress from Tennessee.
The question as to the lien of the bond
holders is now pending in the courts,
In 1863 the Just debt for which the tax
payers had to provide was comparatively
small, while the debt of the solvent roads
was large, but by manipulation the solvent
railroads undertook TO transfer their debt to
the taxpayers and relieve themselves.
Under duress from the threatened orer
throw of the State government by Federal
Interference, and believing they had the abil-
Ity to provide for the payment of the entire
debt, the tax payers submitted to the grave
wrongs which had been done them, RAJ her
then imperil their liberties and subject them
selves TO unfriendly criticism But debt
difficult 10 bear in the beginning, AID con-
stsntly augmenung by fraud and funding,
while all values were rapidly depreciaJing,
became at last too great for them to bearl
and they went down in the hopeless effort.
At no time since the first funding act have
the tax payers been able to pay the interest
upon the nominal public debG. An examin-
alton will disclose the fact that there no
legitimate payment of interest before 1870.
The interest was paid by borrowing money,
by appropriating the assets of the Bank of
lem essee, by selling bonds to raise money,
and partly by taxation
In 1873, when the payment of interest was
resumed, it estimated that the taxable
properly of the State would now be 300
900 900. In fact, il is but little over $780,,
100, 900. The bondhOlders appreciate the
tact that the debt cannot be met, and long
since a compromise would have been had but
Tor the fact that the holders of the bonds of
the solvent railroads regarded their bonds
still lien upon the roads, AID until that
question is settled adversely to them, they
will never offer compromise within the
ability of the taxpayers.
The confusion OF the Just debt of the State
with the questi nable and fraudulent debt
has resulted disastrOusly to her interest and
reputation. There has never been time
when the State was not able and willing 10
pay the interest upon her just Indebtedness,
but by uniting all, pay ment has been made
impossible. The bonds which represent The
several branches of our State debt can at
least be approximately distinguished, and if
so, they ought to be dlstInguished,and permit |
each branch of the debt TO stand upon its
own merits and be adjusted accordingly; and |
for this purpose an appropriate committee |
should Investigate all the facts connected |
with the debt and report thereon, in order
that the Justice of the case of the State may |
be exhibited and intelligent action had. All |
efforts at adjustment OF the debt heretofore |
have fai led and that failure has resulted from 1
the fact that the meretorIOus debt and the |
unjust debt have been equally recogn lzed, |
and until plan has been adopted founded |
in justice to ali, it is apparent that no salts
factory result will be reA"hed.
Uniform legislation by the general govern !
ment IN favor of capital and against produc- |
ton has not only deprecated values in the |
state, but has paraly zed more or less every |
pursuit. Consequently, the sub
ject of the State debt presents itself at most |
inauspicious time for adjustment, yet it is |
obvious that some step should be taken to |
solve the difficulty and remove all just ocCa-
SION for Teproach. An investigation will dis
close that the public debt is divided into the /
their merit: Fist, the primary debt of the |
State, and distinguished as the State debt |
proper. This part EN- braces the bonds of he |
Capitol and hermitage, the only property
now owned by the State. US the result Of its
investments. Second, the bonds loaned the
a gricultural Bureau. Third, the bonds loan
ed turnpike and plank road companies before
the war. AL OF this property has been sold
and the proceeds turned over to the bond
holders Fourth, the bonds loaned to SOL
l.
own their roads and take ali the profits
Fifth, the postwar bouds. All of tho prop
erty purchased with them has been sold and
the proceeds paid the bondholders.
1t appears, therefore, that all of the prop
erty purchased with the proceeds of this yast
debt, except the Capitol and Hermitage. has
gone into the hands of the Federal govern
ment- the bondholders and the raj lroad com
panies, while the State has nothing but the
iebt and the obloquy resulting from her IN
ability to pay 1t. The amount realized from
.he public property in Tennessee BY the Fed
'ral government can only be approximately
estimated. The net earnings of the I,ouis-
vile 81 Nashville road TOR the year ending in
Iunc, 1865, largely exceeded two millions
FOR the same period, tor months after. and
or nearly two years before, the general gov
rnment was operating all the roads Of tho
State, and took all the profits, besides renov-
ng public property amounting in value to ,
Yearly two million dollars.
All of this property and Its profits had been
,ut in pledge by the State as the primary Sc
urlty for the payment of the bondholders.
md at last whatever injury the bondholder
las sustained resulted from the Injustice of
he Federal government in refusing to pay
What was justly due tor the property and I
'roits pledged ID the bondholders and ep-
by it.
The obvious equities as to the State debt
roper are: First, the funded war interest
o be expunged, and all other funded interest.
'econd, all payments upon the war interest Z
night to be credited upon the principal at
heir value at the time of their pay ment 49, .
Third, where funded at greater rate of in |
crest than the contract originally bore, tie
rginai rate ought to be estored Fourth
here interest has been paid ut a greater rate /
han the original contract, the excess ought
. be credited upon the princiI al at Its then
Rlue. Filth, as the debt at the time of its
reation was pay able in gold or silver, and as
" Federal legislation the State has been de-
rived of the opportunity TO LAY in the
heaper metal, the State ought 20 be allowed
he difference between the market value of
old and silver. =
SO much of the State debt proper as lie =
wned by the Federal government ought to ;
9 entirely rejected, until il is willing to pay
be State the money justly due her The >
onds loaned the Agricultural Bureau ought !,
. be embraced in the sett. err emit of the rsrt-