New-York tribune., 1879-06-03
LOUISIANA AND HER BONDS.

While a Democratic Congress is doing its
worst to destroy the credit of the Nation, the
members of that party are displaying the
same spirit in dealing with the creditors of
their respective States. AT Washington,
Democracy is hampered by a strong and able
Republican minority, and curbed by Presi-
dental vetoes. TO learn what the party
really is, we have to go to the States in which
it wields absolute power. There are prominent
Democrats in this city and elsewhere to whom
recent events have brought lively sense of
the character Of their party, and their expert
ence may bo OF service for the instruction of
others.
A dispatch from Louisiana asserts that the
report of the majority of the committee on
the State debt Will undoubtedly be adopted
in the Constitutional Convention. This infor
nation seems to be confirmed by a report
made to leading bOndholders by an agent
whom they sent to Louisiana in their interest
This agent has returned, and dispatches from
Washington state that his report to large
bondholders there was that the proposition
of the majority would prevail. The
information appears to be credited
by the bOndhOlders, because the price
of Louisiana consols dropped on Satur-
day to forty cents on the dollar, with many
sellers and no buyers. The report of this
committee was briefly described some time
ago, though 1t was then generally regarded
with indifference, because few supposed that
such a step could be taken 10y the COnven-
ton. In brief the committee proposes to re-
putiiate as absolutely invalid and worthless
-, 600, 600 out of the S12, 100000 OF bonds
outstanding. The plea offered is that the con-
stitutiOnal amendment of 1874, which pledged
revenues of the State to be derived from u
perpetual tax to the payment of the principal
and interest of these bonds, was never prop
erIy promulgated according to records of
the Secretary of State. That the amendment
was duly adopted, not even this committee
attempts to deny. But some purely technical
form, il is alleged, was neglected in giving
official notice of the fact, and Oh that ground
alone it is proposed to hold the amendment
void and to repudiate two-thirds of the bonds
In order to appreciate this performance
Justly IL must be remembered that the con-
stitutional amendment In question was adopted
as part of a compromise with creditors of
the State. BY that compromise the State was
enabled to reduce its debt from over $24,-
10000 to S12,000,000. BY means of the
solemn pledge of public faith, made in the
constitutional amendment adopted. the State
induced its creditors to surrender their old
bonds. and TO take Instead the smaller amount
of new bonds which, 1t was represented, were
"amply secured" and would be "foreyer held
sacred by all parties" Some of the Old bond
holders strongly protested. but, in reply to u
protest signed by Messrs. Seligman and others,
the Governor OF the State declared in pub
lished letter in January, 1874:
reiterate the declaration IN my message. that the
people OF Louisiana willing 10 pay every collar OF
their just debts that they are able to pay You
ask what creditors will have that bonds
may not again be funded az stil further reduction
answer by referring you to the bill itself am satisfied
that tho people can and Will obseruy pay The pro-