New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1881-04-13
THE GOVERNMENTS FININcIIL POLICY.

THE GOVERNMENTS FN1NCI1L POLIcI.
II is natural that there should be some OBJ
iections 20 the plan of Secretary WINDOW.
Tbosc who had Loudly asserted that he had no
power To take such "a step are little chagr1nea
10 find that the law officers of the Government
advise him that he has. Those who insisted
that il would be dsgraccfnl in the Government
to assent if asked 10y its creditors 10 permit their
claims to remain unpaid. feel a little ashamed
of their zeal and heat when they see that Prcsi-
dent Garfield and many capitalists OF un-
doubted fidelity to the pnblic faith hold the
contrary opinion Those who wanted some
other plan adopted, by which the stock market
or the market for particular class Of bonds
should I've especially uplifted. bctray their mo-
tives by their angry comments. But the pan
seems reasonable, practical and decidedly wise
to intelligent and candid observers, ana Is re-
ceved with general approval.
The bubble as to the legality OF the course
adopted il not worthy the attention OF sensible
men. There can be no question that the bonds
now outstanding are valid until paid and they
do not become less valid for having stamped
npon them the assent of holders to reduction
in the rate of interest. No man would question
that these bonds without any consent OF holders
tn a lower rate would bind the Government to
nav the present rate of interest and therefore
they equally bind it to pay amy lower rate which
holders may prefer tO accept Ia order To prevent
payinent in full. The pretence that the pro
nospd arrangement is not becoming or credit
able TO the Government does not como from any
whose zeal for the credit of the Government has
been shown in times past. On the contrary, II
is urged by men who have favored schemes and
measures of the most questionable character.
little common sense will enable any one to see
| that the credit OF the Government cannot bc I'M
haired. but must be greatly strengthened, II
| holders of its six per cent bonds, being sum-
| moned to receive their money, voluntarily re-
quest 10 have it remain at interest nj jig per
| cent. Indeed, no step which the Government
has vet taken in all its splendid financial
| achievements could go far 10 advance and
establish the credit of the Nation a. the request
of its creditors to permit their claims to remain
unnaid at a lower rate Of interest than has been
allowed upon any class of bonds yet sold.
| II is said that this plan will not succeed. The
wish ia father to the thought The shrewdest
| and soundest bankers of this city, including
many who have been largely concerned in the
p,acing Of past loans, are Of opinion that large
nroportion of the holders of outstanding bonds
will request their continuance. Some believe
that as many as four-6fths of the ak per cents
will thus be stamped at the desire Of the holders
within the coming month. Others less confident
believe that three-fourths or two-thirds OF the
holders will enter into the arrangement pro-
p.,sed. 1t is well known that, among the
bankers who were consulted by Secretary Win
dom in regard to this course. there were those
who were well entitled to speak for large pro-
portion of the holders of six per cents, and some
of them assured him that the holders Of more
than half of the old bonds would request con-
tinuance even at per cent. The Secretary has
wisely chosen a rate at which it is far more
likely that his resources will suffice to secure
settlement of the entire amount both of skies
and of fves which becomes redeemable this
summer. At present he deals with the six PEI
cent bonds only. But If 20 per cent Of the
holders of maturing bonds assent to the new
arrangement, the Government will have not q
single FIVE or six per cent Understanding bond
outstanding when Congress meets.
One critic says that the Secretary Ia only play
ing q great game of bluff because he has moi
i the money with which to redeem the six PEI
cents. Tho holders know better. The power