The record-union., 1892-10-27
The Refunding Act.

The Refunding Act.
EDS. RECORD UNION: In your paper
of to-day you state that those who advo-
cate the adoption Of the Refunding Act
are enemies Of the public schools, with
out knowing it. Let US see who are the
enemies of the schools (if there are such I
never have met an avowed one.)
Those opposing the Act desire that the
State shall in some way continue the old
bonds at 6 per cent. for all time, so far as
l can see. The chief, if not the only
reason, they give for such continuance is
that per cent. is better interest than can
be had elsewhere. Now, suppose the
Act is defeated, and the Legislature con-
tinues the debt at per cent. for the rea-
son given, what will the consequences be?
You Will then have established a prece-
dent, and when at any time there shall
be sum of money belonging to the
schools or University that cannot be in
vested at 6 per cent they can 90 to the
Legislature and ask that said money be
taken by the State at per cent. They can
point to the precedent and give the same
reason now advanced, and demand that
! the money shall be received and interest
at the rate of per cent. be paid for all
time, regardless of the prevailing rate of
the country.
| Is this what the opponents of the Re-
! funding Act desire? If so, let the people
! know it.
| If this policy should be adopted, would
not the enemies of the schools have the
opportunity 50 much dreaded by the op-
| pOnents of the Act to assail the schools :?
such opportunity would present itself at
the meeting of each Legislature, and the
! enemies OF the schools would not be slow
to take advantage of it.
Adopt this policy, and how long will it
be before all the funds of the schools and
OF the University, amounting to S5,000,0O0
| or S5,Oc0,O00, Will be IN the State Treasury
| drawing per cent. interest?
| In this connection it should be known
| that the invested common school fund is
now S3,553,550. OF this amount s., OF, ,O50
Is invested IN county bonds. Now if
those in charge of the school funds so de-
! sire they can take the money received
from the sale Of new bonds and invest in
county bonds at a better rate Of interest
than 10 take the per cent. State bonds.
and they can, by slight amendment Of
the law, invest in irrigation district bonds
at q per cent, and thereby save per cent.
to the State, with no loss to the school
fund, and at the same time greatly benefit
the districts and the whole State.
Now, which of the two plans is most
likely TO provoke assault on our public
schools-to vote for the Act. issue new
bonds, take up the old, and end the mat
ter at once, or vote the Act down and 90
to the Legislature to have it in some way
continue the debt at an unwarranted rate
OF interest, and thus give those who are
hostile to our schools a chance to assail
them from the fact that the State is paw
ing q per cent. on the bonds, when it is
well known that her bonds can be sold.
and probably at a premium, if they draw
only per cent?
The best thing to do, in my judgment,
is 10 vote for the Act, sell the new bonds,
cancel the old, turn the money into the
treasury TO the credit OF the schools and
University, invest it in county or irrlga-
tion district bonds, inforce the law and
pay the debt in twenty years, and thus
END the whole matter. This course will
in the end be much the best for the
schools, best for the State, and will leave
no chance for pickering and quarrelling
over what will be done with the school
money.
Again, suppose the Act be rejected by
the people, what will it mean-that thew
tthe people, want the debt continued at {;
per cent, when they rejected it at 4 per
cent? Hardly; or. will it mean that they
want the Legislature to provide for its
pay yment al the earliest period possible?
That would be far more likely.
II owed you note for 81 600. dine the
I'd day OF January next, but was not pre-
pared to pay it when due, what would he
the manifest remedy? Undoubtedly to
ask renewal OF the note. Suppose / re-
fuse, even at per cent. less interest.
what would be your concIusious2 Fvi
IDENTIFY that l intended to repudiate the
debt. Draw your own conclusion. IF
the Act be rejected by the people. it will
be plain to my mind that they want the
debt paid-that they do not want it con-
tinued. There IS, in my judgment, but