The Wheeling daily intelligencer. [volume] (Wheeling, W. Va.) 1865-1903, 1881-01-31
JOHN SHERMAN
DINED By THE MERCHANTS' CLUB
OF BOSTON.
An Address ON the EubIsct Of Funding
and RerundInE Operations Of the
GOVernment-RegulRt that
Govern them, and the Reasons
for Adopting Ihsm.

was entertained this evening at q dinner
given by the Merchants Club OF this city,
and in response to an invitation, delivered
on address, touching upon the relunding
operations OF the Government and the
management Of the public debt. The Sec.
retary opened with a review Of the llnan.
Cial affairs OF the Government at the close
OF the Revolutionary war, and Of the neCes-
sty that then existed for the relundiug Cf
the debt at that pOriod for the purpose OF
securingR lower rate OF interest, and ex.
tending the period of its payment, and IL.
Illustrated, by contrast between the
amounts involved in the reiunding oper.
atiOns Of that period and those OF re-.
cent times, the progress made in
the Conntry's growth, The Secretary
continued: The revenue now received for
three months amounts to more than all
the debt OF the Revolution. Tho resump.
tion fund, now held to protect tho redemp-
ton Of United States notes, Ia more than
double the amount OF revolutionary debts.
had occasion recently to look into the
beginning Of the financial operations OF
the National Government, and found the
first entry, dated September l3, l770, in
day book No. /, was that OF draft upon
the Bank oil New York OF Sc, 900 Tor the
credit Of Samuel Meredith, Treasurer OF
the United States, being part OF loan
agreed to be made by that bank to Alex.
ander Hamilton, Secretary Of the Treas.
ury, and this was tho first money
received into the Treasury OF the
United States. II was followed by
similar transactions 10 the amount Of
$l40 900 during September and October,
which was used mainly for the payment
OF members OF Congress. This loan was re.
imhursed out Of the first reyenues Of the
new government, The whole expendi.
lures for the first year OF the government
were about equal to two days receipts OF
the Treasury at the present timo. Follow.
ing the financial operations Of the govern
ment thence TO the administration OF Gen.
Jackson, when the national debt was paid
In full, the Secretary stated from that time
to the beginning OF the civil war, inClud.
ing the period Of the Mexican war, tho
debt Of the United States ranged from
minimum OF $4,000 TO q maximum Of
SOS, O0.0OO. It 1t apparent that in all
moReyed transactions OF the govern
ment prior to tho civil war, certain gen.
eral principles were followed, the chief OF
which was that the debt was TO be cOnsld.
cred as q temporary burden, to be paid az
rapidly as possible. In this respect our
financial policy has differed from that OF
European countries. We have always
made provision for the gradual payment
Of our debt, and they do not. Another
lprincipls upon which we have acted Is
that public securities shall run but for o
short period and that the right OF redemp.
tion shall always be retained 90 far as prac.
ticable. This right Of redemption has not,
In any case, been placed beyond
the average life Of a single gen.
Grafton, and this principle Is more
tenaCiously adhered to In the popular
branch Of Congress than any other 10 70.
speCt 10 our debt. Another principle for.
mefly held by us Is that whenever the
public debt Ia contracted, a sinking fund
should be set aside for It's gradual llquida.
ton. Another principle OF our financial
policy 10 that not only shall tho principal
OF the debt be gradually paid, but every
suitable occasion be taken 10 reduce the
interest thereon, and thus lessen its bur.
den. But more than all, the United
States has always firmly and fully and
honestly performed every promise made
to the public creditors. These principles
were inherited by us, when the OWL War
came on US and compelled the contracting
OF debt In amount so vast that one years
interest was more than the debt caused
by the wars OF the Revolution and Of
1912. Attention was devoted 10 tho rapid
payment Of the public debt and the adop.
tion Of the funding act OF 1870. At that
time legal tender noles were unliqndated,
the dishonored promises OF the Govern.
ment were worth less then par in coin
and no man can say the extent OF the evil
OF this single fact upon our credit during
the last fifteen years alter the war. At all
events, though the Funding Act gave the
Secretary oI the Treasury ample power 10
sell bonds bearing five per cent interest,
yet II was slx years after the passage Of
the law before he was able TO sell $4,000.
900 OF this class OF securities. When they
were exhausted II was long and
slow process TO establish In the
market the iour.and.a.half per cent bonds.
II was not until after the passsge OF the
Resumption Act, and The plain, definite
policy 10 intoroe that act was announced
by the Executive Branch Of the Govern.
ment, and ample provision made 10 re.
deem our legal tenders on demand, accord.
| ing 10 law, that we were able 10 sell our
iour.perUent bonds at par. During 1877
they were first offered. Our notes were
rapidly advancing TO par, Under the
effect Of measures adopted under the Re.
sumption Act we were able 10 sell that
year $77,00O,000, but when II appeared
Congress was not prepared to sustain the
policy oiredemption the sale oithese bonds
al once ceased as with clamp. When II
vas manifest that Congress- would not re-.
peal the Resumption Act they were again
Bold, but Il was not until the lst OF January,
1879, when the United States was fully
prepared to redeem iIs notes at par, that
the credit OF the Government became 90
firmly advanced that four pur cent
bonds were eagerly taken at home and
abroad 80 rapidly taken, indeed, that
within four months 1851, ,OO0, 900 we're sold,
thus providing for the redemption Of all
five and six per cent bonds then redeefna.
BILE. The policy ol relunding is not ye
oompleLe 900, 100000 Of ak per cent
bonds, issued at;ihe beginning oithe war,t
are about tomattte, ndithe AG0 900, 900 oI
Eive per cent bonds Issued Under the re-.
funding act will become fedeemable
the let oi May next, and the question IL,
how best can we apply the principles oI
our government Id the reduction OF the
rate Of interest and the gradual payment
and redemption OF these bonds? | eau
only say we should follow the examples oI
the past; we should pay what we car
from the surplus revenue. We should
sell oui securities at the lowest possible
rate Of interest, fesefying the right 10 re-
deem them in a short period oil time, and
pay them either as they becomt
due, or by purchase In open mar
ket. Our country 10 indeed for
tunale when II may now confessed
ly borrow money at 90 low rate o.
interest ss any nation In The world, how
ever ahciAnk hohulOpa and weallhv,