Vermont watchman and State journal. [volume] (Montpelier, Vt.) 1836-1883, 1882-12-27
Matrl,man d gnnr,raI.
WEDNESDAY, DECEMBER 81, 1882,
The Debt OF Tennessee.


courses on reputation in Tennessee The
people Of Tennessee are just now confronted
with very important problem in politics
and political economy in the question as to
what they propose to do towards read
justing,' settling, or repudiating perhaps,
their state debt. The question, however,
while it involves a purely local obligation,
may have consequences so important to the
future prospects of the democracy Of the
United States that it is alike the duty Of
the people of the north to consider it, and
of the people of the south, aud Of Tennessee
in particular, to respect northern opinion on
the subject. The debt of Tennessee, which
is in issue here, amounts to about S21 ,000,-
900, including a sum variously reckoned at
from 100000 to s6,0O0,0O0, and locally
known as state debt proper Most of the
bonds were issued at par, with the promise
of six per cent interest. The state first cut
the interest down to three per cent, but failed
to pay either that or the principal. Sub
sequently a committee of bondholders OBJ
tanned from the present legislature pledge
of payment by funding on the basis Of
sixty per cent of the principal and a scale
rate of interest at three, four, five and
six per cent. A large portion of this in
debtedness is held in the north, and under
this last plan, some 100000 of the bonds
have been funded. In the canvass which
preceded the last election in Tennessee, the
funding of this debt became the most
sharply defined issue - so sharp, indeed,
that the democracy Of that state was itself
divided on the question whether the terms
of settlement made by the bondholders' COM
mittee should be adhered to, or whether a
new basis Of fifty per cent and interest at
three per cent should be insisted on. In
the contest at the polls, General Bate, the
standard bearer Of the readjusters,' as the
50.3 advocates are called, was elected gov
ernor, and it is understood that majority
of the legislature, which is to be organized
on January LIST, is committed to this read.
speech at Fayetteville General Bate said If
you elect me governor Of Tennessee on the
democratic platform adopted in Nashville
in June last, will fold my arms when the
bondholder comes aud tell him he must
take the sos, and if he refuses, will let
his bonds mould and rot This is clear
and distinct avowal of policy, and there can
be no mistaking its meaning. We cannot
hot off fo1 of
Bates arms may have on the suppliant
creditor who comes to ask the state to pay
the debt it owes him, except that it may
add to the dramatic force of the announce
ment. But what the bondholders will be
apt to think is that General Bate is acting
as the agent of cabal Of regulators, and
unless the state of Tennessee is pretty we'll
stocked with cash capital it may have q
hard time to pay its current bills, not to
speak of mourning new debts and getting
trusted by future bondholdsrs. Tennessee
must not look at the present alone in this
matter. The city of Nashville is to-day Of
fering loan of its water works improve
ment and promises six per cent interest or
the bonds. But such declarations as these
from General Bate and his supporters are
not calculated to strengthen the credit Of
anything within that state. Even If they
stipulate to pay the sos, there is no telling
how soon they or the next administration
may make it 400 on a new deal, next 200
and so make reputation reality"