Staunton spectator. [volume] (Staunton, Va.) 1849-1896, 1881-02-01
From the Richmond Dispatch.
Letter from A. H. H. Stuart. ESQ, on
the Public Debt OF Virginia.

-EUTLOTS D1SOOLCH. lDeTo Is no SuDJect
which has occupied larger share of the
attention of the people of Virginia for
the last ten years than the public debt
of the State. It has been discussed in
almost every conceivable aspect In the
public prints, at the hustings, and in
our legislative halls. Several abortive
| attempts have been made by the General
Assembly to settle it, but it still weighs,
| like a nightmare, on the Common
wealth, obstructing her advance in the
path hkOf progress which lies before her.
Finally, politicians have seized on it as
means of gaining office and influence.
| The intrinsic difficulties which encOm-
| pass the subject have thus been aug
Y mented by the addition of others of a
| partisan character. In my judgment,
this is greatly to be regretted. The
question is one of business nature.
| AS such, it ought to be discussed, con-
I sidered, and acted on in 1t calm spirit,
| and on business principles.
I No intelligent and fair minded man
will deny that the State of Virginia
owes, in round numbers, about thirty
two millions of dollars Nor will any
one deny that the debt was legitimately
contracted, or that the State received
full value for every dollar which she
owes. This has been virtually admitted
| over and over again by successive Leg~
islatures and Governors, ar Il has been
affirmed by the solemn Judgment OF
our own Supreme Court of Appeals.
think, then, / may ssfely assume
these facts to be established beyond ali
controversy.
Another great fact is also equally we'll
settled-viz., that by the results of the
war the taxable property of the State
has been reduced nearly one half since
the debt was contracted.
The latter fact, while it lnay furnish
q basis for an appeal to the clemency
and indulgence of the creditors of the
State, cannot in anywise affect the legal
rights of the bondholders becau se they
were in no way responsible for the con-
sequence of the war, which was de-
clared, doubtless, in opposition to their
wishes. Here, then, we are confronted
by these incontrOvertible facts: First,
the existence of this great debt of thirty
two millions of dollars; ard second,
that our ability to meet it has been i'm
paired to the extent of one half
The Legislatures of 1866 and 1871 re-
cognized the whole debt and promist ed
to pay it in full, with interest at p,gr
cesatatna per 0aaYaNa7a and the Legisla.-
luIc vi 1Ol1 duLAoliZCU UIlc luuUluR Ol
two thirds of the debt of the old or undi .
vided State of Virginia, as it existed be-
fore the war, when the debt was con-
tracted, 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
be forty-five millions) was funded and
twenty millions of new bonds, denomi-
mated "cOnsols." were issued, and ten
millions of what are usually called
West. Virginia certificates. The inter
est on the "cOnsOls" was provided for by
semi annual coupons, which were made
receivable in payment of taxes.
While this process of funding was 60
ing on a new General Assembly of Vir-
ginia was elected and assembled, and
being dissatisfied with the action. of its
predecessor, passed an act purporting to
repeal the sections of the funding bill of
1871 which provided for the receivable
ity of coupons for taxes. &c. The va
lidity of this act of repeal became the
subject of judicial consideration, and
our Court of Appeals decided that so far
dS OAC luAuluR 0du OCCu PCllCCCCus Oy
the acceptance of the terms of the bill
by creditors and the consummation of
thes agreement between the creditors
and the State by the surrender of the
old bonds and acceptance of new icon
sol" bonds, there was. a ''contract" be-
tween the parties, which, under the
provisions of the Constitution of the
United States, could not be ''impaired"
by any subsequent action of the States,
The Court, therefore, held that the
repeating act, so far as the ''consOl'
bonds, which had been issued, were
concerned, was IN violation of the Con-
stitution of the United States and inop-
erative and void.
Thus there has been fastened upon
the State of Virginia debt of little
over twenty millions of dollars, which
is, substantially, preferred debt, the
interest on which, at the rate of per
centum per annum amounting in the
aggregate to 81, 200, ,0OO) lis secured by cou.-
pons, which are receivable in psymer 1t
Of all taxes and other debts and e.
mands due to the Commonwealth.
But there still remained SIS O0O, 600 of
this original debt of the old State of
Virginia which had not been ftu ulded
when the act repeating tle sections of
kuo luuuluS Ulll Vi 1o(4, AuOV0 S0! oTreU
to, were passed. Of this two-tniI ds tor
$40, 600, ,O0O) was recognized as the debt
of the present State of Virginia, and
the remaining one-third Tor S.. 200, ,OOO)
as the debt of West Virginia.
The holders of these fifteen millions
of dollars of original bonds attempted
to fund them under the provi,si ms of
the act of 1871, but the Court .,f APP
peals very properly decided that as the
holders of these bonds had not before
the repeal of those sections accepted and
complied with the terms of the law of
1871 by actually surrendering their old
bonds and receiving new ones in lieu of
them, thereby perfecting the agreement
between themselves and the State,
there was no contract" within the
meaning of the Constitution of the Uni
ted States which could be impaired
but merely an overture by the Sta, with
a view to a contract, which, it wa, COM
petent for the Legislature mt any time
before final acceptance and compliance
with the terms by the creditor to with
draw.
But, as the Legislature had failed to
repeal the whole funding bill of 1871,