The daily gazette., 1881-02-18
From N. Y. Herald.
THE REFUNDING BILL.

ION OI Juo COIuulrECihl CouCfeS De GX-
plicity declared on the difference which
Is certain to arise between the Senate
and the House on the bill for refund
ing some seven hundred millions of
the public debt. If the Senate is
right it ought to be strongly support
ed by that part Of the press which has
examined The subject and is entitled by
its knowledge to express definate opin-
ions.
The Funding bill has been debated
in the Senate for the last two days.
The lucid opening speech of Senator
Bayard ON Tuesday in support of the
amendment to the House bill recon-
mended by the COMMITTEE on Finance
had nothing of the headlong zeal of
an advoca o, but was marked by the
candor, precision and Intelligent men
tai equipoise of judicial opinion de-
livered rom the bench by an able and
impartial magistrate.
Senator Bayard's speech deserves
greater commentator from thu fact
that he has the courage to dissent
from the pretty unanimous opinion of
his own political party in the House.
When TIE force of reason constrains
an eminent statesman to differ with
his party it may be assumed that he
has carefully surveyed the ground and
sees that the public interest justiiies
his course.
The only serious point OF conflict
between the Senate and the House is
likely to be the rate of interest on the
new bonds. NOBODY objects to three
per cent if that is practicable rate;
but everybody, except the holders of
the expiring high rate bonds, has rea-
SON 10 object to rate which would
prevent the acceptance of the new loan
by capitalists. Rejection of the pro-
posed bonds in the money market
would impair the credit of the govern
ment and would be attended with the
further disadvantage of a continued
payment of the present high rates of
interest on the maturing bonds.
Let us take the six per cent bonds
for illustration. The difference be-
tween six per cent and three and one
half per cent is two and one-half per
cent per annum. II, therefore, re-
funding should be postponed for but
single } ear the loss would absorb the
whole difference between a three per
cent and three and one half per cent
bond. Both the Senate : I'd the House
propose TO make the new bonds re-
deemable at the end of five years. A
difference of ore-half of one per cent
IN the rate of interest would amount
IN i've years to precisely two and one
half per cent. 1t is plain, therefore,
that If the p tssage OF a refundiug law
Is carried over TO the next Congress by
between the two houses
the loss 10 the government by years
will quail the difference
between the proposed House rate and |
the prop sed Senate rate. So, if the |
House should defeat the Funding bill |
by standing out for three per cent the
government would gain nothing, even
u this should prove to be practicable |
rate next year. Precisely as much
would be lost by a years DELAY as
would be gained by the adoption of
'he three per cent rate in the n, KIT Con-
Sress. But before The next Congress-
meets the condition of the money mar
Iet may be 80 changed as to render
wen three ana one-half per cent bonds |
dnsalable, causing considerable loss
o the Treasury by the postponement.
The present condition of The money
market is exceptionally favorable to
he success of new loan. How long
his favorable condition will last no.
'ody can tell, and it therefore be.
looVes The government to ke hay
While the sun shines and avail itself of
he opportunity before it passes. 1t is
ertain that the government could dis
ose of three and one-half per cent
.onds now it is by no means certain
bat IT could do SO "a year hence.