The sun., 1893-07-09

or the States considered in this volume. Mis-
sssipp was the first to practise repudation.
| As early as the fortes. she refused to pay one
class of bonds. aggregating in face value S5.-
100000. and in the flfties another class ag-
gregating S2.DO0O00. Tho first mentioned
bonds were issued in 1888 in payment OF 5000
shares Of stock in the Union Bank OF Missis-
sfppi: the second class of bonds had been is
sued earlier. namely. in 1881 and 1882. to the
Planters Bank. The highest courts OF the
State decided that both classes Of bonds had
been issued in conformity with the State Con-
stitution and were valid. The Legislature OF
1872. however. passed a resolution to the effect
that the State was under no legal or moral OBJ
legations to pay the bonds issued to the Union
Bank. and these were accordingly repudiated
At the election Of 1852. the question was sub
mitted to popular vote whether tax should
be levied to pay the interest on the Planters
Bank bonds. and majority Of 1000 against
the levy OF such tax was returned. This vote
undoubtedly meant that the people were in
favor Of repudatine these bonds also, and
willing Legislatures SO interpreted 1t. The
fate Of both the Planters Bank and Union Bank
bonds was sealed by the Constitution adopted
In 1875. which contained the following clause:
Nor shall the State assume. redeem. secure or
pay any Indebtedness claimed to be due by the
State OF Mississippi to any person. association,
or corporation whatsoever claiming the same
as owners. holders, or assignecs OF any bond
or bonds known as the Union Bank bonds or
the Planters Bank bonds"
The story Of Florida's defalcations is long
one, but Dr. Scott has mana ged to condense IL
in q few pages. Both as Territory and az
State. Florida committed acts OF reputation.
Under the Territorial Government she issued
or endorsed for banks $3.9OO.OOO of bonds
which. upon entering the Union as a State,
she repudiated on the ground that as a State
she was not responsible for the debts con-
tracted In bohali Of banks and other corpora
tions during her Territorial life A better rea-
son might have been assigned. and. in fact
was suggested by the representatives Of the
Territory in the debates upon the question in
1S41. About that time the population of
Florida was estimated at some fifty thousand
souls Hence the debt which the failure OF the
Territorial banks had brought upon her
amounted to over $50 per CAPITA and the
further issues which were demanded by the
acts chartering the banks would have brought
the debt to about 5000 per capita. 1t won Id
have been impossible to pay the interest on
such debt and at the same time to meet the |
expenses OF the Territorial Government
The debt contracted and repudiated BY |
Florida after she became State was assumed
In pursuance OF an act passed In January.
1855. authorizing los subsequently amended) |
the issue OF State bonds to the amount OF |
$4,000 per mile In aid OF railroads. Bonds to |
The amount OF S4.0O0.O00 were issued. but |
early In the seventies tho railroads defaulted |
N their interest payments. and the State was
sailed upon to mako good the deficiency. This
she was utterly unable to do. but she was re-
ieved OF anxiety by a decision OF her courts
o the effect that the bonds were unconstitu-
ional After this decision was rendered tho
state no longer troubled herself about the
abroad aid bonds. and subseq uently omitted
o mention them as among her liabilities
~.
It is rather Of scaling down her debts than
u reputation proper that Alabama can be
The debt contracted before the civil
var had been reduced by payments OF princi
'al to 3445.OOO. and the interest had been
egularly paid up to the outbreak OF secession.
wen during the war she paid that portion OF
he intereft which was due on tho bonds held
n London. but paid no interest in New York
fter January. 1851. After the civil war the
tate debt was greatly augmented. so that.
'hen tho funding act was passed in February,
BIG. the principal amounted to $25. .404.4
esides large arrears OF interest. OF the prin-
ipal, $2.0Oo000 was unprovlded for in the
unding act. except that certain tracts of land
ariously estimated at from 100000 to 1.2OO,-
OO acres In extent were turned over to tho
ondholders. Moreover, state sndorseme ents
s4.7O5.O00 were left entirely un-
royided for. All the other debts wore graded
nd refunded on a somewhat complicated sys-
I'm. the result being that their total principal
as scaled down from S1S. 100. 470 to s12,574.- /