Morning journal and courier., 1880-01-28
Wednesday Morning. Jan. 2s. 1880.
JUDGE KELLEY,s PLAN.

Judge Kelley's scheme for paying of that
 part of the public debt which becomes redeem
 able at the option of the government between
 now and Sept. 1, 1891, has much to commend
 it, and is said to find favor with many mem-
 bers of Congress. He believes that it is best not to refund the debt referred to but to pay
 it as soon as possible, and he thinks it can
 easily be paid before 1907. The loans which
 become redeemable between the present time and Sept. l, 1891, aggregate $1, ,031, :, $40, 300, and include all the outstanding bonds of the government except the per cents., the re- funding of which was recently completed, and which will not become redeemable until July 1, 1907. These bonds are the per cents., which include the Oregon war debt, $s21, 300; the 6s of Dec. 31, 1880, SIS, AIS, 900, and the 6s of June 30, 1881, $254, 164, ,250; in ali, $273, 40O, $50. The per cent. loan, amount ing to $50s, 44o, $50, becomes redeemab1e May 31, 1881, and the 4a per cent loan, amounting to $25O, 900, 900, becomes redeemable Sept. 1, 1891. Judge Kelly's proposition is to issue no more bonds, but to pay of the $1 ,O31, $40, 300 in the 27 yearsintervening between the present time and 1907, by maintaining the sinking fund and purchasing each year one twenty seventh of the total amount above stated which would require the payment each year, on ac- count of the principal, of $3s, ,216 33o exclusive of interest. By this plan the sixes would be paid of in six years, the fives in 13 years, and the four ard a. -halfs in six years, thus cancel ing the entire amount of $1, ,O31, $40, 300 in 25 years, the last or twenty-fifth installment of the principal being $4s, ,216, 1920. A cal culation on this basis shows that the aggre- gate amount which would be paid during the 25 years on account of interest is $596,-| Al, ,06s, which is about 24 per cent per an mum for the entire amount of the principal thus paid. The aggregate of principal and interest to be paid by this plan is $1, ,62s, ,2S1, O6s, and the amount of principal which it is proposed to pay is no greater than that now required to be paid under the Sinking Fund act.
 Judge Kelley submits figures to show that his scheme would be far more advantageous to the government than Secretary Sherman's proposition to fund the maturing bonds in new four per cent. bonds running thirty years, or Fernando Woods plan which provides for re- funding with three and 8 half per cent. bonds running fifty years. By adopting Secretary Sherman's plan Judge Kelley points out that at the end Of thirty years we shall have paid one thousand two hundred millions for inter est alone, and still be debtors for the entire principal while under Woods plan we shall have disbursed eighteen hundred millions for interest and still owe for the whole principal. Another disadvantage attending these plans is that by them the government loses control of it's loans and could not Hauidate any portion of the public debt for period of 27 years un- less it went into the market and bought its bonds at the ruling premium.
 The advantages of such plan as Judge Kelley's are obvious. By it clean work would be made and the burden of debt quickly dis posed of. But, as the New York Times says, Git must not be forgotten that taxes are paid from the annual savings of the country, and it is fair question whether a smaller annual drain would not be more advantageous and less burden upon the business of the nation, even if continued for a longer time, than one which should consume larger amount each year."