Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1888-12-29

resist their powerful neighbor. 1t is now
reported that Chile has interfered for the
second time to prevent Peru from settling
her foreign debt, and the Peruvian Minis
try has in consequence resigned, and Con-
gress has adjourned. OF course t is npon
the plea that no foreign creditor of Peru
should obtain foothold on Peruvian terri
tory that Chile interposes her mandate;
but really the desire of Chile is to force
the sale to herself of the Peruvian debt.
If that is achieved Chile will simply own
her neighbor completely and can annex
the territory as soon as she pleases.
Peru is indeed in pitiful condition and
the dilemma of the President, General
Caceres, is one to excite general sympathy.
The army of his nation has been reduced
to mere handful of 1900 men, and the
navy that was at one time a model of
strength and completeness, now consists Of
two old transports. The bonded foreign
debt of 1869, 1870, and 1892, the last of
| which bears per cent, amounts to S164,-
10000, and with interest, to S257, ll5, 900;
adding the home debt the total reaches
SS73, 456,O0O. The currency of the coun-
try. once as good as gold, has greatly de-
preciated, and is steadily falling and it
now takes thirty paper dollars in Peru to
buy goods that one silver dollar will pur-
, chase. Financial panic has been chronic
IN the unfortunate State for over wear,
and but few months ago it was necessary
to keep large communities under military
surveillance to prevent the outbreak Of
riots as result of the disbursement of
the people. because of their inability to
use paper money, its purchasing capacity
having SO greatly declined. Upon this
subject our Consul at CalIao reported in
the July volume, 1888, of Consular re-
ports that the depreciation of the cur
rency-due to assumption by the Govern
ment of responsibility for the bank issues
IN consideration of the redemption of
credits held by the banks against the
Government-was such as to cause wide
spread misery. He added:
The Government pays out the paper to its
| enormous list of employees, and these to provide
Tor their ne cessities, forced to convert their
| pay INTO silver at simply ruinous discount AS
| matter OF course the limited revenue at the
| disposal OF the Government almost entirely de-
rlyed from the duties paid into the Custom
mouse, is most seriously affected by this change.
but. being destitute of funds to even GRADUALLY
| redeem the paper, the burden has to be endured
ana IL falls on multitude. 1t is estimated that
tnere were 6O,OC0Oo0 paper soils in circulation or
| IN private hands. This sum was equivalent to
2OOO,OOO silver soils, and in the course of a week
mas been rendere useless and NAV be consid-
ered as practically lost. Such blow TO a nation
IN such financial straits as Peru is to-day is
hardly conceivable abroad but when the panic
began, ten days since December 1887. there
were numbers of families in this city and at
Lima VINO were actually unable to buy food
with the only medium in their possessiOn-r,a-
per money. In the interior from Lima, in the
enormous Indian population of the departments
Oh nuaIuco ana lnnln there is no silver in cir
culatlon paper is the only money known, and
wnen the news reaches those districts of the
crisis and rejection of the paper money at the
metropolis and center of the Republic it is
feared that the most unfortunate results will
follow.
The revenues of the nation for the fiscal
year lSS7-SS were estimated at but SIG,
100000, while current demands for SUP
port OF the Government were placed at
S13,600,000; but the first half of 1887
the actual returns from customs fell
100000 short of the estimate, and nearly
all the money taken in by the nation was
expended in maintaining the army. The
Government was reduced to such straits
last year that it felt compelled to declare
opium Government monopoly, where
upon 1t put up at auction the right to
traffic in the drug In 1886 ex-Mayor
Grace, of New York, representing the
European creditors of Peru, proposed a
plan for cancellation of a large part of
the debt, and for the extension of railroads
in the country upon the REIMBURSEMENT
by the Peruvian Government to its cred
itors of 1853 miles of railway, the creditors
to extend the lines and make the railway
system harmonious. The creditors were also
to surrender 100000, 900 of Peruvian bonds
or half of what the proposers of the plan
represented and for the other half to I'M
dertake to get it from Chile, as owhers of
the Province of Tarapaca which Peru
coded at the point of Chilean bayonets.
The creditors agreed also to advance to
Peru S20,000,000 in thirty monthly IN
stalments, to be used in paying interest
upon the home debt, and for transporta-
ton of troops, supplies and mails, to the
extent of $4,000 month. Against this
plan Chile entered her protest 50 far as the
sum the creditors hoped to recover from
Chile was concerned. This laid the
scheme upon the shelf.
This year the President covenanted with
an English representative of the creditors
for settlement of the debt, and such pro-
gress was made that S25,00O,000 of home
obligations would have been discharged.
but have left Peru with her silver and guano
properties mortgaged to secure the remain
ing Indebtedness. Congress rejected the
plan, unquestionably actuated by fear of
Chile and by distrust of its ability to carry
out the suggested scheme. Just what was
the new plan for adjustment of the national
debt that Chile has prevented Peru from
adopting, We are not informed, but it is
believed to be of much the same character
as the Grace-Aranibar scheme that we
have outlined.
COUNTING THE BALLOTS.
In unearthing the election frauds in San