The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1879-01-28
LOUISIANA FINANCES.


ORIGIN AND PRESENT CONDITION OF THE DEBT
TALK OF REPuDIArIoN-AN APPEAL TO THE
BoNDHoLDERs TO REDUCE THEIR CLAIMS
INTEREST DUE AND PROSPECT OF PAYMENT.
NEW ORLEANS JAM %. 1870
The debt proper of the State of Louisiana just be-
fore the late put down by official authority
i'll round numbers at s5.700,00O Immediately after
the additional debt was contracted
ST. 600 O00for levees and this with the obligations
known Is "red backs"-nearly q million more
issued principally to meet interest coupons ante
beum bonds. made the whole debt at this interesting
period after which oil of our troubles are dated at
something over 13.50O000.
After the warmoth government came in power
wholesale robbery followed and the debt was further
increased to eight millions more In 1874.
what is known the Funding bin was passed, and it
first proposed that the State debt should be
scaled at fifty cents to the dollar with interest at
five per cent per annum. This, however. not
adopted. Instead. the bonds were reduced sixty
cents and per cent interest was allowed it
claimed by the friends of the measure that in
forty ycars-the period which the bonds to run
by the increased rate of interest aowedthey would
fully recover what had been lost in making the
change To meet the interest and principal of these
bonds the law provided that tax of five and half
mills on the dollar should be levied annually the
assessed value Of all real and personal property in
the State and that this should be collected for the
purpose of paying the interest and principal of the
consolidated bonds. and that it should be deemed
felony for the fiscal agent or any officer of the State
or Board OF Liquidators to divert the said fund
provided, and that any party so doing should be
liable to Imprisonment for not more than ten years
or less than two the discretion of the Court The
statute was further accompanied by constitutional
amendments which limited the debt to SIS 900.
making this provision part Of the State constitution.
declaring explicitly that the revenues of each year
derived from taxation upon all real, personal
mixed property or licenses should be devoted solely
to the expenses of the year which they should be
levied, and that any surplus remaining should be
directed to the sinking of the public debt. Now, it
should be forgotten that the settlement made with
the creditors of the State ratified by popular
vote Of the State and thus became organic law of
the land. Immediately after this arrangement was
completed loud cry went up the whole face Of
the country that great debt had been left upon the
necks of the people Of Louisiana by the carpet-bag
aoyernment. which they could never pay and it was
only just and proper that they should repudiate it.
Now. our people have so long sung this song that
they cannot break themselves OF the habit OF 1t and
SO continue sing it up to the present time believ
ing the cruel burden still continues to exist.
STATEMENT OF THE DEBT.
How stands the case in fact?
Funded debt of the State. Sill T24 800
ESTIMATED amount yet to be funded. 4S8, 100
General fund warrants (Kelloggs state
ment, as reported by the Auditor)...... 1SS.72O
Total. Sl24Ol $40
This is something less than it stood Immediately
after the Now what has become of the seven or
eoyernmenti This debt has been paid, not by the
State but by the creditors Of the State the bondhold
of the State by the REIMBURSEMENT OF forty per
cent of their claims according to the provisions OF act
of the session of the State Legislature of 1874 in
actual fact this wholesale plumber. which beyond
actually not cost the State cent In 1873, Gov
ernor Kellogg having his funding scheme in view,
S OF %ers o to S
together with the rest Of the coupons OF former
years. Thus the collections for the interest
fund made in 1878 were already in the treas
ury to meet the coupons Of 1874. In other words,
the then ready to its interest before the
interest wanted Through some strange. press-
ing necessity however, best known to those in au
thorty it happened that money in the treasury de-
SaS to he nsed for something else. conseauentiy
when the coupons came up for payment. in 1874 the
State under the law had to fall back upon the tax of
1874, which only collected in 1876
THE NICHOLS ADMINISTRATION.
When the present administration came into power
the Board of Liquidation under 1t. finding deti-
cheney in the interest fund aud DESTROYS to protect
the State, made an arrangement with fiscal agent,
wm1 T Sa1d,n 10 for his own account SUCH Of
the interest coupons as might remain I'M
paid for want of collection Of sufficient
funds. The duties Of his Office the fiscal agent con-
tinued to perform without any remuneration what
up 1873 In this year act IS of the extra SEES
sion of the Legislature provided that the fiscal agent
should be the amount of his advances,
together with Eve per cent extra, which was to be
taken from the redemption or sinking fund; When
agent In advance to the State 500. A74 80 for
| coupons of former years which he had cashed for
the State and therefore declined making further
advances until these were paid. The State could not
| make any settlement with the fiscal agent, either
| pons remained unpaid To the unfortunate po-
| sition of the State Treasurer, whereby he
called to the the made the Ssss
them are put into his hands the Governor had to call
the attention Of the last Legislature 1t was sug-
gested by him that the settlements Of the tax collec
tors now made in January should be advanced to De-
| cember to meet the payments in January, and the
settlements now made in July should be advanced to
June to meet the semisnnual payments of interest
as they become DUE Strange, however, as 1t may
seem. no steps to meet this difficulty were taken.
Possibly something may be done by the present
PROSPECTS OF PAYMENT.
If the remedy suggested by the Governor is ap-
piled and the assessments made equal throughout
the State-the collection of taxcs being pressed
there can be no doubt that the state will be
further scaling or reduction. Placing the tax
able property as low as $1soOOo,0U. with
tax of five and one-half mills, which is the tax
fixed by the act of 1874 we have $3.50 000quite suf-
ficient to pay the interest on the debt as it now
stands. That there is great inequality in tho mat
ter of assessment there be question. In the
city of New Orleans il excessive while throughout
the country it is much below what It should be.
One instance Is well known where plantation was
assessed ut $4,000 which actually brought, when
sold S90OOO and another instance has just been re-
u
SOL 600 which the would not sell for $l5 000
In places in the country. am assured. even .
mild species OF bulldoxing s resortcd to to affect
assessments; but there other modes Of reaching
assessors besides this which everybody knows have
been practised almost everywhere.
That the present Legislature will apply any remedy
to this crying evil is not to be supposed for one in
slant The county which is always in the majority
cannot 20 so much against its interests
while there other modes OF meeting the difficulty
which would hurt il less. One-most in favor now
is the old trick of calling upon the bondholdcrs to
bear the burden and submit again to further re-
duction of their dues, which looks very much ike
actual reputation Under the peculiar ideas which
prevail bill has been introduced in the Legisla-
ture making further reduction in the interest on
State obligations ve per cent which. it is clsimcd,
will make all things fair and practicable. But even
the last Of these fsncios may be questioned II the
state will not pay per cent when it can, will it
pay SIX Ave. four per cent any tho more will
inglyg That the present Legislature has very
clear perception OF tho sacred nature of contract
very certain; that will attempt to defraud
the holders of State obligations seems equally
but that this scheme be carried out to absolute
realization without the consent of the bondhoders Is