New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1881-01-20
THE FUNDING Bill.

country Will ToghIu Vho eo-OahO"
bill" which has been matured after long laDor
in the House, as the measure OF the utmost
craftsmanship to which that party can attain
The occasion was one which called for the
highest exercise of whatever faculties the
marty has It has been beaten, to its great
amazement and disgust, in the sixth successive
Presidential election, and beaten nanny
because the country distrusted both lts honesty
and it's capacity in the treatment OF hnanciM
questions. 1t had become an absolute neces-
sity for the party, before losing control OF
legislation, to do something to show that IL
could treat such questions with honesty ana
capacity. All the leading members OF the
party have been engaged in the labor Party
spirit and party necessity have been appealed
to openly, in order to bring into some tenn
porary semblance of harmony and cooperation
elements which are really separated from each
other as widely as the poles. 1t has been teh
and said that the country would judge the
party by its behavior in this emergency.
Members who did not like the bill prepared
have been persuaded to give 1t reluctant
assent, on the ground that its passage
had become necessary to redeem the
party from the public suspicion and contempt.
If the Democratic party under the pressure OF
such extreme circumstances has not agreed
upon an honorable, practicable and useful
measure, what chance is there that 1t ever can
The first section of the bill authorizes the
issue of not more than $500, 100000 in three
per cent bonds, redeemable after five and pay
able in ten years, and $300,O00,0O0 in three
Der cent certificates, of $40, $50 OF $50 each,
redeemable after one and payable in ten years.
These must be sold at par, SO that the debt
shall not be increased; the six per cent bonds,
when called, shall cease bearing interest thirty
days thereafter aud before any of the new
bonds shall be issued the Treasury must "pay
con the bonds accruing during the year 1881 all
"the silver dollars of 412l2 grains and all the
"gold over and above $50, 100000 now held in
"the Treasury for redemption purposes" The
supreme absurdity Of tho last clause-an
ATTEMPT to dishOnOr the United States first, by
paying gold bonds in silver, and atterUGrd TO
sell more bonds-caused its defeat in the
House, though even this rare bit of stupidity
would not have been omitted had not the little
band of Democrats who had sense enough 70
vote against it been reinforced by the solid
Republican vote, with one exception. The
vote on lnlS QhteltOuB nhtth 10 oA"'J@'N ~
orr Washington dispatches, Is instructive
reading. IL exhansts comment to say that
three-fourths of the Democrats in the House
voted for this astonishing proposition.
The certificates authorized are intended to
operate as an imitation of the currency, lt is
suppOsed that, in spite of their interest-bear-
ing quality, these will be readily purchased
and will circulate at par. The savings banks,
il ia said, pay no higher interest; therefore,
$500, OOO. 900 Of deposits will be Withdrawn
from these institutions and invested in three
Nor cent certificates. IL Is well to note in
n,ssing the strange reckessuess which con-
terminates without alarm the sudden with
drawal Of vast amount of deposits from
banks which hold and are obliged to protect
a much larger amount of the savings of the
people. II this should take place, the loss TO
individuals which would follow the failure of
savings banks, aud the contraction OF loans
which would result from their efforts
to protect their deposifOrs and save them
selves. would speedily teach members of Com
gress that they had made blunder. But the
people who are sensible enough to have de-
posits are also sensible enough IN most cases,
at least, to foresee that three per cent
certificates would be likely to depreciate in
market value very quickly. At the first
breath OF monetary stringency these certifi-
Gates, if once issued, wonld be thrown upon
the market in excess of the demand
for them, and would have no legal
tender quality to support them in
nominal value. 1t is not highly probable.
therefore, that careful people will put their
la,
obliged to lose or 10 per cent of 1t in order
10 get the rest of it back. The probability is
that the certificates will fail to sell. The re-
naming $500, 600, 900 of bonds will not suf-
flee, even if sold readily, to pay off the bonds
which become redeemable this year.
As to these bonds. moreover, it is evidently
calculated that the National banks can
be forced to take them. The amount,
$500, 100000, is about that which the banks
hold in other bonds. But it has been fully
explained already that the National banks are
much more likely to stop the sale of the bonds
by contracting their loans, surrendering crcu-
lation and contracting the currency. To the
banks this mode of resistance would offer q
quick and sure profit In order to prevent
the sudden retirement of circulatioA thg bill
makes provision which is peculiarly calcu-
lated to accelerate it, BY repeating the Act
which now allows a surrender of circulation
upor the deposit .ofa legal-tenders the bill
proposes to take away from the banks
resource which has been most po-
tent to prevent a retirement Of cir
culation hitherto. Being warned by the
passage of the bill in the House, it viii be
strange il many banks do not take measures
to surrender their circulation at once, anless
they are advised that they can do so under
the provisions of the present law, at ony time
.,rinr 10 Nov 1 the hnte nnnarantlv RYnh In