Vermont phÅ“nix. [volume] (Brattleboro, Vt.) 1834-1955, 1881-02-04
REFUNDING.


SECRETARY sHERMAN's REMARKS AT TIE DOS
TON MERCHANTS CLUB DINNER, LAST SAT-
URDAY.
Secretary Sherman, before the merchants
club OF Boston on Saturday, said the United
States government has always fully met its
obligations to public creditors, and then re-
viewed the means by which this had been ao-
complished as follows When civil war came
upon US, it compelled the contracting of q
debt in an amount so vast that one years in
terest was more than the debt caused by the
wars Of the revolution and 1912 attention
was devoted 10 the rapid payment Of the pub
lie debt, and the adoption Of the funding act
of 1870 resulted. At that time the legal ten
der notes were the unliquidated dshonored
promises Of the government, worth less than
par in coin and no man can tell the extent
of the OWL of this single fact upon our credit
during the first fifteen years after the war.
At all events though the funding act gave the
secretary of the treasury ample power to sell
bonds bearing 8 per cent. interest, yet it was
six years after the passage Of the law before
he was able TO sell $500, 900, 600 of this class
of securities. When they were exhausted, il
was long and slow process TO establish in
the market the 4 1-2 per cent. bonds. 1t was
not until after the passage of the resumption
act, and plain, definite policy to enforce thas
act, was announced by the executive branch
of the government, and ample provision made
to redeem our legal tenders on demand &C
cording to law, that we were able to sell our
per cent bonds at par. During 1877 they
were first offered. Our notes were rapidly
advancing to par under the effect Of the meas
ures adoptedpnder the resumption act. We
were able TO sell during that year S77, 600, 600,
l,.N ~, .,as
prepared to sustain the policy Of redemption,
the sale of these bonds at once ceased as with
n clamp When it was manifest that Con-
gress would not repeal the resumption act,
they were again sold but it was not until 'af-
ter the LIST Of January, 1879, when the United
States was fully prepared TO redeem its notes
at par that the credit of the government be-
came so firmly advanced that the per cent.
bonds were eagerly taken at home and abroad
so rapidly taken, indeed, that within four
months $537, O0C, 600 were sold, thus provid-
ing for the redemption Of all the and 6 per
cent bonds then redeemable.
The policy Of refunding is not yet complete
S2O2, 600, 900 of 6 per cent bonds, issued at
the beginning Of the war, are about to ma
ture, and S460, 600, 900 Of per cent. bonds,
issued under the refunding act, will become
redeemable on the LIST of May next, and the
question is how best can we apply the princi-
Piles Of our government in the reduction OF
the rate of interest and the gradual payment
and redemption of these bonds. can only
say we should follow tho examples Of the
past. We should pay what we can from the
surplus revenue. We should maintain intact
and apply without diminution, the sinking
fund fixed by law. We should sell our securi.
ties at the lowest possible rate Of interest, re-
serving the right to redeem them in a short
period Of time, and pay them either as they
become due OF by purchase in open market.
Our country Is indeed fortunate when it may
now confessedly borrow money at as low
rate Of interest as any nation in the world
however ancient, populous or wealthy. Many
among us are hopeful enough to believe thai
we can do what has never been done by any
nation in ancient or modern times-borrov
money upon our bonds at 3 per cent. Tn,
mother country has not yet been able to dc
| 80, although in moments of high prices hei
| per cent. consols have touched par. Thes'
| questions are now being considered by Con
| gresR, and believe wise conclusions will b,
reached We all wish to do what is best fo
| the country, but we do not want to lose tn,
opportunity Of doing good thing by attempt
| ing what is unattainAble. believe the gcoC
sense of Congress will conclude that it is bes
| to offer a bond bearing 3 1-2 per cent. inter
est, kept within a short period of redemp
ton, maintain the sinking fund, and perhAp
| apply a greater amount of surplus revenue
SO that we may expeotto see within the nextde
cade the public debt reduced to 900, O0O, 00I
"A sum so small that our successors in ofiic
and in life will feel that 1t is very small pricr
for the countless blessings that the generation
that fought during our civil war has conferre'
upon them.