The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1881-01-23

This review Of the origin o. The debt. and
Of The history OF The fuudlng Dill OF 1871,
and OF the PROCEEDINGS under II, has been
deemed necessary 10 show the injustice 10
| creditor which has grown out OF II, and OF
the acts of subsequent legislatures 10 regard
| TO Il, and to make plain to every one tue
difficulties which stand In the way oil iair
settlement.
I think every fair-minded man must re.
pret the existence Of these classificai IONS OF
! the bonds OF the State, and Of the differences
| in The value of the bonds OF the different
classes. They were all given for money
borrowed for purposes connected WIN the
hest interests OF the State. They were all
equally lust, and In equity all have equal
claims TO be paid by the State.
But we must deal with facts as they exist.
The classification aud disparity In value oil
the various classes c0nfronis us as Stubborn
facts. We can neither strike them out oil
existence nor ignore nor get around them
We must meet them sqnarely face to face.
Nor can we disregard that provision OF the
Constitution OF the United States which
forbids any State from passing any law
which "impairs the obligation OF con-
tracts" Neither can we, as sensible and
patriotic men, set ourselves in opposition
TO the calm and wel.considered judgment
OF our own Court Of Appeals. or to the
well.known line OF decisions OF the Su'
preme Court OF the United States. which
support the judgment OF our own highest
judicial tribunal.
| Various measures have from time 10 time
been proposed TO relieve us from our diff
Guilty. We have had the McCulIoch " bill,
the Barbour" bill, the " Bocock Fowler "
bill, and the Riddleberger bill.
The Riddleberger bill is an open and
undisguised Reputation OF twelve millions
OF the public debt. 1t assumes the right oil
the State, one OF the parties to the contract,
to ignore utterly the rights OF the other
party. II disregards the prohibitions OF the
Constitution OF the United States. and it
boldly assumes the right Of the State to pay
or not to pay Just debt, as she may think
proper. Ii makes the State the sole Judge
whether she will pay anything or nothing,
at her arbitrary will and discretion. II she
can repudiate at her own mere Will twelve
millions OF the debt, why may she not
on the same principle, or rather want oil
principle, refuse 10 pay anything! Indeed
think the Inference may fairly be drawn
from that bill that the alternative which II
intended TO present TO the creditors Is, take
twenty millions IN full discharge OF your
obligations, or nothing! do not propose
10 discuss this bill. II must shock the moral
sense OF any enlightened people.
The Barbour" and the "BOcock- F0w-
Ter" bills are less Objectionable in form, but
not much less 20 in their etltc cts. They dis
claim reputation IN name. Indeed, they
recognize that the creditors have some dim
and shadowy rights; but they regard them
as very misty and underlined. They, In ell
feet, LAY TO the creditors, We acknowledge
| the Justice Of your Gebts, and would DE
glad TO see you paid; indeed, we are WILL
| ing TO apply any surplus or our revenue
which may exist alter the payment OF Inc
expenses Of our Government and OF our
public schools TO that object. But GOOD
care Is taken not to give any guarantee mat
any such surplus would exist. 1t is simply
idle TO suppose that any credtor-and more
especially any creditor VINO has the security
which the holder Of consol" bonds enjoys
in the receiyability OF his coupons Tor
faxes and other dues TO the Common
wealth-woud think for Il moment OF &C.
cppiinp the terms OF either OF those bills.
The "McCulloch bill, though by no
means free from defecrs, was much less OBJ
|
distinctly recognized the fact that the credit
ors had rights which were entitled to re-
spect, and it nominally substituted consent
for coercion in the arrangement which II
pro2osed to make with the creditors. 1t
provided for funding, with the consent OF
| The creditors. and through the agency OF a
syndicate" the three classes OF bonds
above enumerated into new bonds having
| forty years to run, bearing interest at the
rate of 3 per centum per annum for the first
ten years, per cent. for The next twenty
years. and 5 per cent. for the remaining ten
wears. But in order 10 make this exchange
the creditor was required to present two
thirds of the amount proposed to be funded
or exchanged in consol" bonds, and the
remaining third either in "peeler' bonds,
or the equivalent in original ante-wars,
subject TO a deduction OF one third OF the
face amount, that being the share 10 be
assumed by West Virginia.
In pecuniary point Of view, always
thought that the provisions OF this bill, II
they could have been carried into effect,
would have been very advantageous to the
| Commonwealth, as the result would have
| been TO reduce the interest on the whole
| debt TO an average OF about per cent. At
this rate the aggregate Ofthe interest Oh the
whole debt OF S30,000.000, including all
three classes, would have amounted to
| 81 200, 900, which Is Just the amount that
was beng annually paid in the form OF tax
receivable coupons on the 100000, 600 OF out
standing consol bonds. Assuming that the
whole amount of 100000, 600 was just, and
must ultimately be paid, with interest, this
bill would have saved annually TO the State,
in the form Of interest, the handsome sum
OF S600,000.
The bill, however, was Objectionable in
several particulars. In the first place, it
gave to syndicate" the exclusive right
of funding the bonds. The holders OF both
classes OF bonds In the proportion required
for funding could not 20 to the Auditors
office directly and have them funded on
their own account. but could approach the
government only through the "syndicate,"
to whom they were compelled 10 pay tribute.
The bill operated harsbly also on the credit
ors OF the second and third classes, who
were compelled>to sell or exchange their
bonds ut less than one third OF their face
value, and then accept reduced rate OF IN
terest on this diminished amount 1t Is
true that the bill on its face contemplated
the full and free consent OF the creditors to
the new funding process, but l apprehend
that in nine cases out OF ten it was the pow
erty, and not the will. OF the impoverished
holder which consented.
But Il still greater objection to this bill
was the mpractcsbility Of carrying it into
full effect. As the result proved, there
were many holders OF bonds OF all classes
whose necessities were so great that they
were compelled to part with them. or fund
them through the "syndicate." In this way
something over eight millions Of dollars
were funded; but / doubt. II there had
been no war made on the McCulloca bill,
whether a much larger amount would have
been funded under it. | doubt it because