The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1881-01-20

ldet ttD ycHIS tuuu tut YuDUC uCut Va wv
State. II has been discussed In almost every
conceivable aspect In the public prints, a
the hastings, and In our legislative halls
Several abortive attempts have been made
by the General Assembly to settle II, but II
still weighs, like nightmare. on the Com
monwealth. obstructing her advance In thu
path Of progress which lies before her. FL
nally, politicians have seized on IL rs I
means OF gaining Office and influence. The
intrinsic difficulties which encompass the
subject have thus been augmented by the
addition OF Others OF a partisan character
In my Judgment, this is greatly TO be re-
GREETED. The question IL one OF business
nature. As such, II ought to be discussed
considered. and acted on In calm spirit,
and oil business principles.
No intelligent aud foir.minded man will
deny that the State OF Virginia owes, IN
round numbers, about tbirty-two millions
OF dollars. Nor will any one deny that the
debt was legitimatey contracted, or that
the State received foil value for every dol
| lar which she owes. This has been virtually
admitted over and over again by successive
Legislatures and Governors, and has been
affirmed by the solemn judgment OF our
own Supreme Court OF Appeals.
| think, then, may safely assume these
facts TO be established beyond all contro-
versy.
Another great fact is also equally well
settIed-yiZ., that by the results OF the wac
the taxable property OF the State has been
reduced nearly one half since the debt was
cont racied.
| This latter fact, while it may furnish a
basis for an appeal to the clemency and in
diligence OF the creditors OF the State, can
not 10 anywise affect the legal rights OF the
bondholders, because they were IN no way
responsible for the consequences OF the war,
which was declared, doubtless, in oppos-
ton to their wishes. Here, then, we are
confronted by these incOntrovertible facts ::
Fist, the existence OF this great debt Of
thirty-two millions OF dollars: and second,
that our ability TO meet IL has been impaired
to the extent OF one half.
The Legislatures Of 1866 and 1871 recog-
niZed the whole debt ana promised to paw
it in full, with interest at per centum per
dnnun, and the Legislature OF 1871 author
lied the funding OF two thirds OF the debt
OF the old or undivided State of Virginia,
as 1t existed before the war, when the debt
was contracted, that being the equitable
share which the present State of Virginia
ought, in its opinion. TO bear, leaving the
remaining one third to be settled by West
Virginia.
Under this act of Assembly about thirty
millions of the original debt of the old
State (Which was estimated to he forty-fve
millIons) was funded and twenty millions of
new bonds, denOminated "coDsOIs," were
issued, and ten millions OF what are usually
called West-Virginia certificates. The in
terest on the 'consos" WAS provided for
by semi-annual coupons, which were made
receivable in payment OF taxes.
While this process of funding was going
on a new General Assembly of Virginia was
elected and assembled, and, being dissatis-
fed with the action OF its predecessor, pass
ed an act purporting TO repeal the sections of
the funding bill of 1871 which provided for
the receivabity Of coupons for taxes, dc.
Tue validity OF this act OF repeal became the
subject OF judicial consideration, and our
Court OF Appeals decided that so far as the
funding had been perfected, by the accept
ance OF the terms OF the bill by creditors and
the contamination Of the agreement be-
tween the creditors and the State by the
surrender Of the old bonds and acceptance
OF new "consol" bonds, there was ICON
tract" between the parties, which. under
the provisions OF the Constitution OF the
any subsequent action of the State.
The court, therefore, held that the re.
pealing act, so far as the "consol" bonds,
which had been issued, were concerned, was
in violation OF the Constitution OF the United |
States and imperative and void.
Thus there has been fastened upon the |
State OF Virginia q debt OF little over |
twenty millions OF dollars, which is, sub. |
stantally, preferred debt, the interest on |
which. at the rate OF per centum per an
mum (amounting in the aggregate to 81, 200,- |
DO0). is secured by coupons, which are re- |
celvable in payment OF all taxes and other !
debts and demand. due to the Common.
wealth.
But there still remained Slj,000,000 Of the |
original debt OF the old State OF Virginia |
which bad not been funded when the act |
repeating the sections Of the funding bill OF |
1871, above referred to. were passed. or |
his two thirds Tor 100000 00) was recog-
1ized as the debt OF the present State OF
Virginia, and the remaining one third Tor
s.. 000, 000) as the debt OF West Virginia.
The holders OF these fifteen millions of
iollaIs OF original bonds attempted TO fund
hem under the provisions of the act OF
81, but the Court of Appeals very pro-
)erly decided that as the holders OF these
)oDds had not before the repeal of those
ectiOns accepted and complied with the
erms of the law of 1871 by actually sur.
endering their old bonds and receiving new
mes in lieu OF them, thereby periecting
he agreement between themselves and the
tate, there was no "contract" within the
Deaning OF the Constitution of the U0ted
tates which could not be " impaired" but
nerely an overture by the State with view
0 a contract, which, not having been ac-
epted and complied with, it was competent
or the Legislature at any time before final
cceptance and compliance with tue terms
y tue creditor to withdraw.
But as the Legislature had failed 10 re-
zeal the whole funding bill OF 1871, but
My the clauses in regard TO the ;eceivabilty
I coupons for taxes and other dues 10 the
it was still competent for |
he holders OF original bonds to fund them |
nd receive in exchange new bonds with [
oupons which were not receivable in pay I
,ent OF taxes. a number of the original [
reditors availed themselves of this priv- {
'ge, and received new coupon bonds, the |
oupons OF which were, on their face, not
in payment OF taxes. This Sc ,
Dnd class Of bonds is known in commercial I
rcles as "peelers." | am not advised of ,
&c amount OF this class OF bonds which has '
cen issued. | presume it amounts to sew ,
al millions OF dollars but it can readily t
G ascertained at the office of the Second :
uditor. =
Thus it will be seen that we have a second
ass OF Virginia bonds, which, though =
Iually just, and in equity entitled to stand b
] the same footing, are in law and in fact
laced on lower level, as the coupons cam 5