Omaha daily bee., 1894-01-14
CARLISLE AND A BOND ISSUE
Condition Of the Treasury Calls for Much
Solicitors Comment.
CONSTITUTIONAL LAWYERS INTERESTED
Rnmored Intention OF the Secretary to
Avail Himself OF the Privileges of
the Act of 1878 should Com
gress Delay In the Matter.

WAsiuSGToN, Jan. 13.-That the lowuess
of trcasury finances is exciting general atton-
tion is evidenced by the many rumors con
stantly in circulation purporting to Indicate
the future action of the secretary should his
recommendations for a bond issue not re-
ceive prompt action at the hands of con
gress. One of these reports, which has been
generally circulated, is that unless speedy
action is taken Mir. Carlisle will avail him
self of the privilege which 1t is contendcd
by some he now possesses. Under the act of
1875 the secretary OF the treasury had the
right to use the proceeds OF any moneys in
the treasury arising from the sale of bonds
for any purposes other than those mentioned
in the act. The publication of this state
ment has led to many inquiries at the treas
ury.
Secretary Carlisle was not at the depart
meht, but the terror of replies to the ques-
lions that were received were to discredit
this. The matter having been called to the
attention of congress by Secretary Carlisle
the department, it is said. will await the
action of congress before taxing anT stops.
Republican members OF the senate
committee on finance do not see
any prospect of immediate action on
the proposition for issuing bonds which was
submitted to the finance committee. Mr..
Carlisle told the committee to exercise its
discretion, but he iXed the interest limit at
3 per cent. The denomination of the bonds
was left blank, TO be filled in by the commit
tee. Some of the democratic members of
the finance committee do not relish the bond
scheme, and there is sure to be u sharp con-
test before it is agreed to.
If congress gives authority to the treasury
to issue 3 per cent bonds not the slightest
difficulty would be found, it is said at the
department, in issuing 500 10000 or more
among the people of the United States with
out resorting to subscription from abroad.
Judge Cuiberson's Views.
Secretary Carlisle's reported purpose of
issuing bonds by virtue of the general
authority granted to the secretary of the
treasury under the act of 1873 has ioused the
interest of some of the leading constitutional
lawyer of the house as to the legality OF
such action. 1t is well understood that Car
Isle would not resort to this general act eX.
cept for the purpose of meeting the press
ing demands for cash. Judge Culberson OF
Texas, chairman of the judiciary committee
of the house, and most, if not all, of his col
leagues on that committee say that while
the secretary has the general right TO issue
bonds he cannot use the proceeds derived
from their sale except for the single purpose
of redeeming outstanding treasury notes.
This, of course, would preclude the posi-
bllity of using the proceeds OF Il bond issue
for meeting current expenses and would rem
der the resort to bonds almost nuFatory.
Judge Culberson mas made an exhaustive
study of the bond subject and in giving his
views today he referred to the report he had
made to congress on July &, 1852. 1t was in
response TO Il resolution of inquiry presented
by Representative Dockery asking whether,
under the act of 1873, the secretary of the
treasury could use the money arising from
the sale of bonds for any purposes other than
those mentioned in the act. Judge Culber-
sons reply was signed by congressman
Oates of Alabama. Bynum of Indiana,
Stockdale of Mississippi, Goodnight of Ken.
Ohio, Wolverton of Pennsylvania, Fellows
of New York and Buchanan of Virginia.
All of these gentlemen with the exception
of Messrs. Fellows and Buchanan are mem
bers of the present house and are regarded
as authorities on legal questions.
Nc Limitation to His Authority.
In the report they say: There is no lin
itation upon the authority of the secretary
of the treasury to sell for the purpose OF re-
dcmption under the act, but the proceeds de-
rived from such sales cannot be used for
other than redemption purposes"
The report furthermore states: "1f the
reserve fund of 500, G00, 900 in gold bullion
required to be maintained in the treasury
should be depleted, in the absence of all
available surplus revenues but the redemp-
ton of legal tenders, the sum should be re-
stored from the current coin receipts not
otherwise appropriated, and when such rev.
enues are transferred to the reserve fund
they are subject to be used for any other
purpose" Judge Culberson referred to this
report today as covering the reported pur-
pose of Mr.. Carlisle to issue bonds. He said
that 1T was very clear to him that the pro-
ceeds could not be used for any other purpose
except the redemption of outstanding treas
ury notes.
A minority report was also presented at
the time Judge Culherson's report was
put in. Mr.. Ray OF New York,
and four other republicans joined in the re-
port. Judge Culberson saws, however, that
Secretary Foster prepared the report. The
minority insisted that the secretary had the
right not only to issue bonds without any
further authority from congress-, but also
had the right TO use the proceeds from the
sale for current expenses. A peculiar fea-
ture of the Culbcrtson report is its refer
cnce to the emphatic language of Mr.. Bay
ard, now minister TO Great Britain, concern
ing the reserve fund of 500, 900, 900. The cx-
preston was used by Mr.. Bayard when a
member of the senate, ana while the act OF
1883 was under consideration. Mi. Bayard
said: 1T cannot be too emphatically
stated and repeated that gold was bought
with bonds of the United States with one
purpose only. II was to procure ana main.
tain resumption; and if 1t be used for any
thing else IL is n perVerslon Of the funds
and a breach of trust. Judge Culbersou
and Messrs. Bynum, Boatner and other con-
gressional lawyers agree in the opinion of
MIR. Bnyard That the money realized in the
sale of bonds cannot be used for any other
than redemption purposes without violating
a sacred trust.
UyIT ~ nII1 % TDnkI MED VI q