Savannah morning news. [volume] (Savannah) 1868-1887, 1882-11-23
OUR FINANCIAL METHODS.
An Adverse Criticism from High Au-
thOrity in England.


The revenue of the United States is COM
ing in with such rapidity as to embarrass
the Treasury, or rather, we should say
so rapidly as to make the Treasury, as at
present managed, an embarrassment and
restraint to business. In the ten working
days, from the 1st to the 18th of this month";
the receipts, exclusive of deposits for
silver certificates, amounted to E4,150,-
000 as compared with f2, $50, 900 in the
corresponding period of 1881, the payments
in the two periods being f3, 700, 900
and 43, 100000, respectively. In the pay
ments for this year are included not only
the ordinary government expenditures, but
also the amount paid out in the redemp-
tiOn of called bonds; and yet, in spite of
these exceptional disbursements, the re-
ceipts largely exceeded the outgOings, and
money accumulated at the Treasury. The
effect OF such an accumulation is, of
course, to diminish the outside supplies,
and thus to tighten the money market. just
at present its tendency in this direction is
counteracted by other influences, but at a
time when the market is, from other
causes, disposed to stringency, the opera
tiOns of the Treasury are apt to intensity
the strain. A few weeks ago, for instance,
the Secretary of the Treasury, In order to
avert threatened disturbance of the
market, had to resort to the eXpedient of
offering to redeem, without rebate of in
terest, f5,OO0,OOO of 81 per cent. bonds,
and even this device for releasing the
Treasury funds has, as already shown,
proved only partially effective. Nor
is it only that money is locked
up. What is possibly even worse
is that the extent and duration of the
lookup is, to a large extent, dependent on
the will of one man, The Secretary of the
Treasury has discretionary power to call
or refrain from calling in bonds for re-
demptiOn, and thus to release or keep in
hand the government balances. Upon
his action it thus often depends whether
there is to be an easy or a stringent money
market, and, as no one can say beforehand
what action he may take, his power over
the market introduces into business a
fresh element of uncertainty. 1t is inevita-
bic also that the power given to him will at
times be wrongly used, not willingly. but
because all men make mistakes, and the
liability to error is all the greater when a
man with no special training for the work
is made to NEEDLE with a structure of such
extreme intricacy and delicacy as that of
the money market, From all points OF
view, therefore, the present system of
dealing with the funds of the United
States Treasury is bad one, and strong
desire for the Institution Of some better
method is now being expressed. 1t is sug-
gested that the funds of the Treasury. with
the exception of the stock of gold to be
held as a reserve for the government note
circulation, should be deposited with the
national banks, just as our treasury funds
are deposited with the Bank of England.
and no doubt the adoption of this plan
would be. great improvement To be
really effective, however, it should be
accompanied by a reduction of taxation,
for as long as the government continues
to exact a revenue from 420, 100000 10
43O,OO0,000 in excess of its ordinary ex-
penditures, its operations must prove a
source of disturbance to business,