The National tribune., 1888-03-08
scANnaLous FrNANcrER1Na.

sCASDALOUs FINANCIERING.
The most amazing thing of to-day Is that
the country is not ringing with denuncia-
tons of the policy pursued by the Secretary
of the Treasury. 1t is beyond con1prehen-
sion how any course of action SO directly in
the interests of favored few and so preju-
diciaI to the interests of the mass of people
and taxpayers should have escaped exposure
and condemnation so long.
The policy to which we refer is that of
permitting the holders of bonds to deposit
the same in the Treasury, and receive
loan equal to 10 per cent above TIER
face value in currency from the Treasury
vaults That is, bank may deposit
100000 IN Jonds-tpon achicb the
Government as paying ii $4,000 inter
est annuaZy-in the Treasury, and receive
a loan, 1UithOut interest, Of 81, 1OO,OOO Of
the cash IN the Treasury, aCticb ii can imnae-
diately loan ont to its customers at from D to
8 per cent. per annum. fit lends the money
at an average of per cent, it makes, of
course, $4,000 year out of it. This, with
the $4,000 it receives for interest on the
bonds, makes total of 100000 net yearly
profit on its investment of 81 0O,000-or
more than 10k per cent!
This enormous amount of safe, clean, as
sured profit is almost without precedent in
the history of banking
According to the February report of the
Treasurer of the United States, there has
now been loaned out of the Treasury under
this policy So, 546,OO8. The Government is
paying to the banks which have borrowed
the money s. 461, s4O32 year as interest,
and they are receiving in addition say
1892 $50 year interest from the men to
whom they have lent it, or in all $6154,60O
year.
In a nutshell: The Government is paying
banks for the atse Of money, and then givi'ag the
money bach to them to tend ont again and get
more INTEREST,"
The excuse for this astonishing procedure
is that the business world demanded that the
money lying idle in the Treasury be restored
to activity.
But the man of ordinary business sense is
not blinded by The sophistTy with which the
supporters and benefeiaries of this policy
attempt to befog the public mind. To him
there is only one way to relieve the so-called
congestion in the Treasury. and that is so
plain and obvious that the wayfaring man,
though he be fool, should not err therein.
Il Is to restore themoney to activity and use
fulzess by using If to buy the bonds outright
which wiz stop the interest, and give the
Nation millions of dollars a year, to be much
more appropriately derOted to paying off its
indebtedness to the veterans who saved its
life.
The s., 40. $40 interest which the Govern.
ment is paying on these bonds would put OF
the pension-rolls Il, 096 veterans at the rat
of S12 month. It would pay the cost o
: carrying into operation the disability claus
D Of the bill recommended by the GAR
National Pension Committee, and take on
of the poOrh0uses of the country the veter
ans who are languishing there! Shall i
be longer said that this country is onl,
generous to bondholders. and only parsi
1 monious and niggardly to disabled vet
n eransP
Let us have an end made at once to thi
a pampering Of the bondholders-this cor
e slant straining and toTturing of our fnancia
vs. policy to find pretexts for filing their pocket
L while denying justice to the men who sac
d rifced their lives in making the bonds th
: profitable investment they have been. Pa
the bondholders off as rapidly as possibl
- and have done with them for once and all.
+" A COMPARISON.
The bondholders lent the Governmei
deprecated promises to pay dollars wort
about IS cents on the dollar.