The Morristown gazette. [volume] (Morristown, Tenn.) 1867-1920, 1880-10-13
TIN STATE DEBT.


We append = draft Of 40 act lsek'
ing towards the settlemeRt Of our
State debt, aud eommend the same
to the perusal snd thsughtful csH-
aideratisn Of eur readers in general
aad especially to those Of thom who
may be candidates for either branch
of the next General Assembly, 1t
was drawn by a prominent lawyer
OF this State, and one who is not
only fully conversant with the his.
tory of our legislation on all ques-
tiens Of finance, but one who, for
years, from q disinterested stand
point has been an intelligent observ-
er OF every event which in the last
decade has affected the value Of our
State bonds in Wall street, the
money center Of the country.
At this writing we ourselves are
not prepared to enter upon dis
cussion Of the provisions of the pro-
posed law, or to give to them such
serious reflection as is demanded by
the importance of the subject, and
we hope in the near future to be
able TO give the matter further and
fuller consideration in these col
umns. We must for the present
content ourselves with simple re-
cital Of what seem TO us the salient
features Of the proposed enactment
The proposition is to provide new
bonds which may be demanded ano
received by holders of the old bonds
who choose to surrender TWO ole
bonds of $1,000 each, with the uu
paid interest, for simple Dew bono
of $1,000, bearing six per cent. in
terest, not maturing for thirty years
The annual interest on the ne7
bonds is, for two years only, pro
vided for by the levy of a tax 0
only five cents upon the one hun
dred dollars or taxable property, no
entrenching upon any exemption
from taxation now in force in tn
State that is as we understand
the tax falls only on those owuinI
over one Thousand dollars of proper
ty. 1t is left to the subsequent Leg
isIatures as they assemble biennis
Iy TO continue this tax of FIVE cent
or to omit it altogether as they ma
deem most in accord with the tru
, interests of the people.
The amount Of new bonds to b
issued is $5,OOO,OOO. The amour
( of outstanding State Indebtedness
be surrendered and wiped out b
! this is the enormous sum of SIS
B 600, 600, or about one half orthe er
e tire bonded debt of the State, priI
3 cipai and interest.
= The bonds ef the State are, as "
| learn from the financial columns {
our exchanges, now selling daily
J.. New York at thirty-two cents on I'll
I dollar. That is a bond for 81, 0C
t and the back and unpaid intere
represented by coupons attache'
= amounting to say $500, on eat
} bond, can be bought for 1920 cas-
, and are daily sold at about TIL
l figure.
A person buying at this price an
, converting his. purchase into IL
! new bonds proposed to be issue
? would acquire the new bonds at G:
e actly the same figure. That is Il
5 two outstanding bonds would co
= him 500 90; should he surrend
i them he would have for his $640,
i single bond, for $1,000, due in thil
:; ty years, bearing six per cent. int
Q est, and payment of this intere
u for the years 1881 aud 1882, wou
S be in advance provided for by Il
a levy Of a tax of five cents on Il
8 hundred dolIars. and the faith of Il
f State only pledged for it's subs'
e quent semi annual payment.
y other words, in lieu of @640, invet
e ed in tooo non-interest paying bond
- he would have q single bond wifi
/ would yield him annually, lat lea
q for two years. the interest on 81 90
e or $50 as interest for his $64O, tn
Il is at about the rate of 81 per cer
!, per annum on his investment. al
G as to the 6Nal payment Of the pri
y cipal he would receive $1,000, f
q his $64O. 1t is a simple busine
/. operation with the holder Of the o
+ bonds. which he can enter into
not, as he may think most advis
BILE for his interests. If he prefe
to retain his two old bonds wi
3, their unpaid coupons and take b
: chances for a better settlement
III. F1tpra that iE his ov0n Ipstt