Savannah morning news. [volume] (Savannah) 1868-1887, 1886-02-24
TREASURY SURPRISES.
MIR. MORRIsoN's PROPOSITION
OPPOSED BY MR.. HEWITT.


OPPOSED BY MR. HEWITT.
The TarIT Reform Leader In Favor of
Keeping the sum Down to stOO, ,OOO,-
OO0-Mr. Hewitt Declares That Finan-
cial Prudencs Dem anda that at Least
@l6s, 100000 Shall Always be on
Hand.
WASHINGTON, Feb. 23.--ln the House
to-day Mr.. Morrison, OF Illinois, from the
Committee on Ways aud Means, reported
a joint resolution directing the payment
Of the surplus in the Treasury on the
public debt. 1t was referred to commit
tee OF the whole. Mr Hewitt, OF New
York, obtained leave to file the views of
the minority. The resolutions read as
follows:
Rssplpsd, etc.. That whenever the surplus OF
balance in the Treasury, including the amount
held for tho redemption of United states
notes shall exceed the sum of Sl00,00O,0o0
It shall be and is hereby made the duty OF
the Secretary of the Treasury TO apply such
excess In sums OF not loss than $40 900 900 per
month during the exstenee Of any such sur
plus or excess to the paym ent of the interest
bearing Indebtedness ef the United States,
payable at the option ofthe government.
THE REPORT.
The report which accompanies the joint
resolution says:
On Jan, 30. 1883. as shown bv the Official
IS atement OF assets and liabilities Of the
Treasury Of the United States " there was IN
the Treasury and United states depositories,
including the amount held for the redemption
Of United states n0tee, aud not including
minor and fractional silver coin. classed as
assets not available, the sum OF SlI4,6S9,ee3 ia
excess of all other liabilities than the redemp
tion Of said United States notes. 10 Is be-
lleved that this sum = largely IN excess OF the
sum required for the purpose for which 1t Is
held, aud that considerable part thereof
should be applied 10 The payment OF The inter
est bearing debt Of the United states now
payable, to tighten a public burden, and not
be unneces'a 'arily held to lure the agents ana
repre- aentatives OF the people on TO improvi-
dent and wasteful expenditure.
THE MINORITY REPORT.
Mr.. Hewitt. representing the minority
of the Committee on Ways and Means,
to-day Submitted to the House long
report on the jOint resolution reported by
Mr.. Morrison from that committee di-
recting the payment of the surplus in the
Treasury exceeding 500. 600, ,000 IN liquf-
dation Of the public debt. Tue report says:
The effect OF the resolution. II enacted
into a law, will hs TO reduce the balance IN
the Treasury available Tor the payment OF lt-
current indebtedness and for tne redemption
oi lega tender notes 10 *lg0,09O,0JO. II makes
no provision for replcnishin9 the Treasury
when the available balance shall fail below
Sl0J,0l0,00e. Gh0 question thus presented i-
whether in view OF the obligations and func-
tions of the Treasury, as now defined by the
law proposed, the limitati0n on the balances
now held for meeting liabilities payable on
! demand IS prudent 1nd safe 10 view OF the
uledgeof Che ItnItt - - 10 redeem. .all it,
hinde5cdness In coin or its equivalent. The
undersigned believe that such limitation
would be unwise, dangerous and at varln lnnce
alike with the eAperienre Of solvent nations
ant OF sound financial Institutions.
TREASURY DISBURSEMENTS.
The ordinary disbursements of the Treas
urg may be roughly stated to amount to
s 100000 day. To meet this disbursement
II IS necessary that areasOnable working bAl-
ancc should be kept on hand. because at times
the current expenditures iargely exceed the
daily receipts Careful business firms usually
carry balance equal 10 one mouths dls-
bursements. Measured By this standard
anc a lower one could nOtesafely be adopte y.
becau-e the Secretary OF the Treasury has no
power 10 make temporary lOans--the working
balance in the Treasury should be about $780,,
600, ,00O That this amount is not too large
Will be apparent from the fact that 10 the
Pension Bureau alone, drafts for $4,000
will be made on March !. and that the amount
of the probable paymenC under the arrears act
cannot be hxed for any specified date.
THE LEGAL TENDERS.
But beside the current expenditures prOvi-
ded for by law, the United sta es has to-
debt payable on demand in the shape OF $685.
6Si,0l6 of legal tender notes. These notes
form about one half Of the paper currency.
They constitute the dnil means OF payment
between ipdividuals and of settlement in All
transactions OF business. 10 is abso-
lutely necessary, therefore. that aOil-
ity TO redeem these notes in coin
should be az all times assured beyond
peradventure. The only question is as 10 the
amount of coin which will constitute Teas-
enable and adequate reserve. To determine
this oint we have no other guide than usage
and experience, In the case of gold and sill
yer certidcates the Treasury keeps dollar for
dollar, but IN the case OF legal tender notes 1t
has not been usual to have at any time in the
Treasury a reserve in coin exceeding one half
of the whole i'sue Of such notes.
SPECIE PAYMENTS.
When specie payments were resumed bonds
OF the United States were sOd 80 as 10 provide
a fund amounting TO s95, 500, 600 in gold for the
purpose OF assuring the redemption OF the
notes, (which, as the law then provided, we're to
be reduced by cancellation 10 $1,000 GOO. .OOO IL
was certainly not considered safe TO begin the
resumption with less than one-tbird reserve
and a. a matter Of fact the available balance
In the Treasury amounted tu over 40 per cent
At the present time under the practice OF the
Treasury, claimed 10 be in accordance With
the bank act Of 1882 &i00,0 900 in gold coli Ia
set apart for the redemption OF legal tender
notes. being rather less than ~ per cent. This
reserve would beregarded by prudent banke
a. the minimum anrunt ln an easy money
market, but Il the financial prospect should
be threatening. prudence wO Ould require that
II should be ENLARGED and strengthened.
sHERMAN's POLICY.
The practice OF the Treasury under Seere-
tary Sherman, who put the resumption act in
opcration. WAS moi 70 allow the reserve 10 fall
heiow 40 per cent, ana. all things considered
thi- IL PROBABLY the smallest amount consistent
with ab-o'uie safety. If this ratio should be
adopted the amount of reserve IN coin would
be si3s, 100000. Adding this amount 10 the
amount heretofore stated a. Il reasonable
working balance we have the sum OF fl0s 0O0,
900 ~ the minimum balance which the Treas
ury should carry In order 10 be in a condition
OF ease and safety. Any other conclusion is
at variance with the Lessons u experience and
well-estabished rules f0I tho safe conduct Of
business.
FIELD FOR sPEcULATORs.
Another consideration may be presented as
fatal argument against tho reduction Of thc
Treasury balance % 500 600 900 Ia the coin,
necessary at all times 70 be kept for the re-
demptiOn of legal tender notes. The ability
OF sneculators 90 reduce this balance below
100000 900 by presenting demand notes for
payment Is obvious aud unless tha eNnodlcut