The Wichita daily eagle. [volume] (Wichita, Kan.) 1890-1906, 1892-11-24
FOSTER ON FINANCE.

/ WASHINGTON, Nov. 23.-In admlnStra-
tion and financial circles the statement
that the Democratic congress may find il
| desirable TO issue new bonds to meet the
probable deficit in the treasury after the
4th of March next is freely discussed. The
proposition of a new loan or resort to an
| income tax does not please the secretary
of the treasury, however, who still insists
| that the Democrats will bs disappointed
If they expect to find the treasury in A
bankrupt condition when they come into
power. Secretary Foster said:
81 do not believe our Democratic friends
W L be obliged to issue new bonds to meet
the obligations of the government. They
will find that we have been conducting the
financial end of the government in a
straightforward, business-llke way. | am
mob prepared now to say just what the sur
plus will be, for intend to use that in my
annual report, which | am at work upon.
1t will be sufficiently large to disappoint
those who have continually accused NE of
Juggling with the figures and conceallng
the financial statements. lt will admit
there have been occasions during the ad-
mlnistratiOn when our cash on hand WAS
very low and when we worried about out-
standing obligations.
Our Crit les often wondered where we
obtained the money to keep the mill NOV
ing They appear TO have forgotten that
the revenues have increased more thsil
Sl5,OO0,000 Then there is the reserve fund
in :he national banks in addition to the
uneXpended balance in the custody of the
various diSburSing officers throughout the
public service. Instead of allowing them
to draw more than they actually needed
to meet all demands, | directed the treas
ufer to pay them only what was required
and the balance was retained in he treas
,rvy- hx,f fr,f r oh h.,
S2G, ,000, 900 to meet sueh demands as might
be made upon US. Then there was "A lot of
small coin that could not b. used for the
payment of debts, in excess of the amount
needed. Four millions OF dollars of small
coin Were utilized, and silver certificates
were issued to cover that amount. Thus
when the dull months came around and
the revenues fell below what was expect
ed. we had ample means TO meet all obli-
cations.
Some persons may find fault with our
present style of keeping the accounts, bu6
that Is because they have never taken the
trouble to give the matter a fair investiga-
ton. Last summer when gold was being
shipped abroad in such large quantities
we commenced to feel uneasy for fear we
would have to draw upon the reserve fund.
The question was asked me, what will
you do if the shipment of gold continues?'
L replied that L would draw on the reserve
fund II necessary 20 sustain the credit of
the government at home aud abroad.
There was more gold out in San Francisco
than could be used in the ordinary run of
business, so we concluded to bring some
of it east in case of an emergency.
Coming back to the proposition to issue
new bonds, the secretary said:
Il can not undertake to guess what the
Democrats may do, but do not think
there will be any new bonds issued | do
not think any party wants now to take
the responsibility of increasing the public
debt, which we have striven to reduce to
save the interest,""
How low an interest do you think new
bonds could be fioated on?" was asked.
THAT would depend on two things. If
the bonds were such AS the national banks
could use as security for currency. and they
were permitted to Issue currency up TO
the full face value OF the bonds, and
If, In addition, the tax on national bank
were to bs reduced from L
per cent. to three-quarters of per cent |
think the bonds could be easily fioated at
2 per cent. interest. The per cent tax OH
the national bank circulation is for the
purpose of meeting the expenses of the
system, and the government has got S40-
O00, 900 or $4,000. 900 out of it. A tax of
three -fourJhs of per cent. would be suf-
ticient to meet all the expenses OF the sys-
TEN. There is no reason why it should
not be reduced to that, and there is no
good reason, that | know of, why the
banks should not be permitted to issue
currency to the full par value of their
bonds"