New-York tribune., 1879-09-18
THE 4 b C OF FINANCE.

c.. laws would tax the West and South bev vond en-
dprance i ccst If exchange, would make the people
nay more interest ON the same capital employed,
and would d. wholly ans ie. One other plan is left
e. Get rii oi bank due-bills entirely. AMI TO issue
Government du .-bls only. This wouid sacrifice all
care for local needs. it is plain. hut would il not he
safe and cheap The bonds held by the banks might
he paid II j. thought. Interest on them might be
stopped. ani a great cost saved.
five cou.i have heavy ram every day, the cost
If building wa'er-works and laying water-NpeS
might he saved. BIT many would then be unable
TO Ct water where they need IL, and. moreover,
thai plan would he bad FOR the crops Grecnbacks
wi not awav, 90 where hank circulation i found
useful. and heavy ram cf moro grcenblcks would
prove fatal t. industry and trade.
To retire hank-notes. it Is proposed to issue
fS3OO 900 oi greenhacks. with which bonds to
fhat amouu could be paid or bousht aud cancelled.
This caDnoi BE- lonc without bad faith until 1888.
when the first bank charters expire. But If II conid
he done az once. What is 10 be gained. Bv getting
rd OF $3.50 OOO 600 of four per cent bonds weshouid
AVE m interest $l3 2OO. 900 yearly But the banks
have paid for ten years taxes averaglngSlG"Os
yearly. WHAT part of the property invested IN
bonds would be taxed after the bonds had been
paid and the banks abolished About three
quarters Of all personal property escapes taxation
entirely. According to the census Of 1870, ont oi
$4,000. .O0O. 900 of personal property, only
Ri2OOOOOODD was assessed, or = per cent. If
as large part the property now ownel by banks
tlould fail % escape after abolition of the banks,
ihe taxes on hat property wonld yield 5i.73fOO0
yearly. wLrrca, the banks now pay Sl6.9Os. 900
ycarly. lhis would involve a loss of Tl2l1I,Ooo
fach year IN taxes. against a saving of Tl32oo"oo
zach year i'm interest. The who would save
BE triAmg diif renee. by giving np all the benefits
bf the safe local circulation of 5000 banks, might
ss well cart his wheat in his wagon from Chi
eago 10 New-York IN order To freight hy rail.
But the bank notes are now made perfectly safe by
sdcpo,it To protect them. Of $40 in United States
bonds for every - OF bank notes. 50 Good are they
That nobody cares. when he takes bin. whctherr
Isl note Cf the Nation O. Of any National bank near
Or far. If the banks are to be- abolished, and
SfSo.OoopsO more OF due-bilis are to be lssned
Government must project these itself. This n can
10 only as ~ tploiecfs ITS nOcs ont, 10y holding
enough ,p.cio 10 make sure that q pay on de-
maud. o. now holds : IA specie against ri0o in
notes 1o provide q like reserve for $3.50 NoNO,OoO
nor. notes. 90 mast raise el35.3oO. .00o in coin. and
If that sam could he borrowed on fonr per cent
kold~ tie cost would be qj,4l-."cO yearly ln m
lr,.f TaG, ih's from the inter- ST saved bv pay
ir. or bonds ard there is cit oni, @7,7s~.ouO
year iot .av.l IN Interest. while Ti217iooO
year vonIi he lost in taxes That wond surely oe
sqvinrlf f'i. ..i.o- ANA wasting 100 tho hung
With u..' .l- saved, The Treasury would bc IN in
STINT darl.r. even before bin to vipo ont the
bank, co1'l pass. TO. tle bank, now hold about
EII0Un1.Dool ln le-al-tendoIs. on which gold can
bedasu ol demand L, amy man jadee for hin-
IeI what Ic Wond do ID he Ald l"aue bis money 'o
Rne llUr. nu. found tAai uniglbor irving T. break
him uplu business or drive h.m oHt of employment.
WmI BE- nut iu.tantly demand LIS money The
banks w,uN lot wait until bin had passed 20
wind tirn ap. As soon as ths pls- re of such
b.n seemed .. rtain. thcy would draw ont gold for
notes. uan wi1 IT, crossing rgir0al track and
secs lu tuai.e coming doe, not WAX for the engine
ios'r.Se lIm before he jumps Al once the banks
would draw from thc Treasury S11oOOO0bO in
gold lor uo,es which they hold Ine Treasury must
pav or bte1,. lhs wou,d alarm other, and savings
banks insurance companies, state ami private
banks, AM private note-holdcrs by the thousand
would rl ST.. to tne Treasury 10 grt gold for notes.
Just ~ th, crisis, i the bin should pass, the Treas
nrvist.hcg'n paying ont $3.50 900 GOO ofurw due
bills Yr, 70 would then have leff. after the bank,
alone had Drawn their gold scarcely e3OopO.ouO
ln spei. .-apt one-tenth enough to redeem the
new nod, O., D., issued. Who woGil take those
notes' ". one bank ia the country. loldors OF
bond, % be paid would refuse n',e, and demand
roin. Could tle Treasury borrow more coin Z After
,uch "a war a71n invested capital had begun, the
Govcrnin mt wou'd find mo- one to buy its bonds In
lhort. tie Treasury would be bankrupt before the
execution of the bin could begin.
Repuiaiion IS .ie real am rs we a, the inevit-
Able end OF thi, s,il-Ine Ii has been virtually de
tlar.l by th. supreme Court that any issue # more
United >.aies notes IN time OF peace would be nm
ton.tirfiolIi. But if the Nation had the power, II
b.. tie. given "a solemn pled.c not 20 increase the
volume IF ic-al-tendcG notes. No plcdIe can be
given of greater importance To public ere utor'. 10
break ID would Doe an act of bankruptcy IN itself.
hsn az the south. who trdmple upon pledges made
bv cities and States often persuade themselves tha
they have sprna excuse and that the credit of thet
STATE or city orght not tn suffer from their act
T.. the terrible consequences of reputation come
lo,n them. rs surely as a child gets burned # 1t
puts its hand nto fire. II does not help the child to
IA. d" thought Il would not bum" 81 1t makes
nodiiisrcnce what pleage-DreaIing doctors think
u SAY. Credit is the opinion of the CREDITOR IL he
thinks an act dshonorable. credit ceases TO exist
NoOthrr pie l.e ever has been or ever can be made
With inor. q, ,'.mniiv than the pledge given in
peat,d acts of Congress that the volume OF OAited
States notes should not De increased Violation of
would sink The United States to the level Of the
Stat, Of Jefferson Davis, which. for many yeals.
h., found no man rash enough f. lend it dollar.
Creditors w,ul see naked repudiation in the act
itself as wei as sure reputation in It's effects and
would make haste TO get their money out of United
States securities Just as men rush 10 a bank for
their money when il has failed 10 pay It's notes.
Bonds bv the million would be thrown upon the
market and slaughtered. Compared with the tinan-
rial hurrc which would result, the widest panic
this country has over seen would be mild and harm
less as an April shower.
Everything was full oflifc and hope in that peace
ful aad bu-y New England valley, before the great
dam gave way. When it broke IN a sin gle hour lofty
factories and humble dwellings long bridges and