The record-union., 1894-12-04
Financial Problem.

During the last month the gold reserve
IN the treasury Tor the purpose of redeem
ing the notes of the Government circulat-
ing as money in the hands of the people
became so reduced. and its further deple-
. ton IN the near future seemed so certain,
that in the exercise OF proper care for the
public welfare it became necessary to re-
pienlsh the reserve, and thus maintain
popular faith in the ability and deter
mlnation of the Government to meet, as
agreed, its pecuniary obligations. 1t
would have been well if in this emergency
the authority had existed to issue bonds
OF the Government bearing a low rate OF
interest and maturing within a short
period, but Congress having failed to con-
slider such authority, resort was neCes-
sarlly had to the Resumption Act OF 1875,
and pursuant 10 It's provisions bonds
We're issued drawing interest at the rate
OF per cent. per aunum, ana maturing
ten years after their issue, that being tho
shortest time authorized by the Act |
am glad to say, however, that OF the sale
of these bonds the premium received
operated TO reduce the rate OF interest 10
be paid by the Government to less than 3
per cent.
Nothing could be worse or further re-
moved from sensible finance than the re-
latiOns existing between the currency the
Government has issued. the gold held for
must be resorted TO for the purpose of re-
plenishing such redemption fund when
impaired. Even if The claims upon this
fund were confined TO the obligations
originally Intended, and if the redemp-
ton OF these obligations meant their can
collation., the fund would be very small.
But these obligations, when received and
redeemed in gold, are not cancelled but
are reissued, and may do duty many
times by way OF drawing gold from the
Treasury. Thus we have an endless
chain in operation constantly depicting
the Treasury's gold, and never near a
final rest. AS ii this was not bad enough,
we have, by a statutory declaration that
it is the policy of the Government to
maintain the parity between gold and
silver, added the force and momentum of
this eXhaustlng process, and added
largely TO the currency obligations claim
ing this peculiar gold redemption. our
small gold reserve is thus subject to drain
from every side. The demands that in
crease our danger also increase the neces-
sity of protecting this reserve against
depletion, and 1t is most unsatisfactory
to know that the protection afforded Is
only temporary palliatiOn.
II is perfectly and palpably plain that
the only way under present conditions
by which this reserve, when dangerously
depleted, can be replenished, is through
Government for gold, and yet Congress
has not only thus far declined to author
iZe the issue of bonds best suited TO such
purpose. but there seems a disposition
in some quarters TO deny both the neces-
sity and power for the issue OF bonds at
all.
/ cannot for a momenb believe that any
of our citizens are deliberately willing
that their Government should default in
its pecuniary obligations, or that its
financial operations should be reduced to
a silver basis. AT any rale / should not
feel that my duty was done If | omitted
any effort l could make to avert such q
calamity. AS long, therefore, as no pro-
vision is made for the final redemption
or the putting aside of the currency OBJ
legation now used to repeatedly and con-
stantly draw from the Government its
gold, and as long as no better authority
Tor bond issues is allowed than at present
exists, such authority will be utilized
whenever and as often as il becomes
necessary to MAINTAIN sufficient gold
reserve, and in abundant time TO save the
credit of our country and make good the