The Atlanta constitution. [volume] (Atlanta, Ga.) 1885-19??, 1894-07-09
of which the figures indicating the debts in

It is not my purpose to enter into a dis
cussion Of the merits or dement's involved
In the reputation acts Of the southern
states. Nor could I do so in the necessarily
limited space of magazine discussion. The
record Of every state Is made and the ac-
ton or each was the result of mature delb
GRAFTON. For reasons satisfactory to the
states themselves, and which have become
matter Of history, q large part Of the
bonded Indebtedness of these states was de-
clared to be Illegal, unauthorized and UNI
constitutional. and the states felt them
selves justified i'll repudiating obligations
to which they had been committed without
due process of law, and by corrupt officials,
whose record OF barter and sale of the
credit OF their respective states forms a
part of the reconstruction history Of the
south. AS for myself, | take the broad po-
sition that for every dollar borrowed in good
faith on the legal credit of any state a dol
lar should be paid. Going further than
this, L think the equities involved call for
the settlement by the states of such bonded
obligations as were taken in good faith,
and the proceeds of which we've clearly
used for public purposes. But fors such
bonded Indebtedness as was fixed on the
southern states by those who overturned
| both human and divine law to obtain au-
J. thority which did not exist, and who used
| the good names and credit of the southern
| states by which to obtain money which
|. they poured like water down the channels
| of their rjOtous and uncaasing demand for
! either equity, justice or law should require
| payment by the states which were so pal
| pabiy robbed, and which, generally speak
| ing, did not even receive tha benefit result
| ing from the proceeds CT the bonds to which
| their names were SO mercilessly pledged.
| IN his treatise on The Laws Of Public
Securities a well known authority the
| subject Burroughs, p. 81 says:
"All who deal with a public agent or Off
! Ger must take notice OF his powers. He de-
| rives his authority from the law which au
| thorizes his appointment. NO person may
| profess ignorance Of the extent OF the pow
| ers Of q public agent
! This is broad principle of law which no
| only justified the states Of the south in T
| fusng to meet obligations which did
| belong to them, but which also preVen&
| such action from menacing the good stan%
| ing of their credit, for under the new cor
ditions established with the reorganization
Of internal affairs after the south had Oh
tanned possession Of itself, Ii basis Of GREG
was established from which it would be q.
reasonable 20 say that the southern state
would depart as 1t would be to charge thas
Pennsylvania, Michigan, Wisconsin or Mir
nesota would repudiate their obligations o.
today because they had done so i'll the past
But, as stated above. [ do not propose
discuss the merit of the reputation acts
it being my purpose to deal not with cause
but effect. and to d,sprove Mr.. Hume
charge that by the Reputation OF I&r6
part OF their bonded Indebtedness, Whethe!
good bad Indifferent. the southern states,
have sustained, and are now suffering from,
an irreparable loss in the consequent loss Of
credit 1 quote from Mr.. Fume's article,'
in which. after dwelling upon the fact that
the Development of the sou.h has been ma
teriany retarded by its lack OF credit, andi
by the fear OF capital in entering a terri
tory in which the reputation skeleton .
stalks, the following:
Georgia is the south's recognized leader
In wealth ana enterprise, but most Of Geor-
ia =
is not much that outside capital avoid
the south. There is plenty Of it seeking h9t>
coal, iron and timber lands and even mill
ions have disappeared IL her luck esA
boomer cities and towns. Why is It. thet
stocks are stunned By investors, and cVens
their mortgage securities go al murderoU
dSeouns? IS it not because, pe nde qG@
legislation and supervision. they share to {
considerable extent the djscred1t OF the' \
legal masters and sponsors"
After this Mr.. Hume proceeds to show
that not only all the railroads, but corpori 6
tons generally including the counties as
towns OF the south, "are more or Less sC~
ferers in The same va" /. Is L.
in i charge SO Sravs NC autslQr
tent hiplseG Wit
out giving either a,aets CURES 70 s.t-s->
it. Instead OF the conditions being correctly
stated, the exact reverse Of The IituatiOn
described by Mr.. Hume Is true. Neither
the cities nor the counties Of the south are
anv greater sufferers from lack Of credit
than the counties or the cites Of any other
section of the country. On the contrary
the credit of the city Of Atlanta Is Gilt-edSc
and during the past decade. she has not IS
sued a bond which has not been promptly
taken at an exceedingly low rate Of inter-
est. So it IS with all Of the leading south
ern cities, where the restrictions Of the law
have been clearly complied with III the use
Of their credit.
As to the southern railroads being in
volved in receivership complications as the
result of the reputation acts Of southern
states the conclusion is too far-fetChed to
invoke serious consideration. Suffice 1t TO
say that some Of the greatest railroad sys-
TENS in the United States and Canada are
now in the HANDS Of receivers, and there
is not a state in the union whose railroad
mileage is not seriously involved Iii rece1V-
crship litigaucn as the result OF precisely
the same conditions that have led to the
appointment O. receivers for some southern
roads A most notable instance is that OF
the vast system of the Union Pacific rail-
road, and even the fact that the govern
Inent, itself was It's sponsor was not sutf-
cient to keep 1t out of receiYership coils.
l have not the statistics before me, but the
proba bllity is that they win SHOW that not
less tnan three-fourths Of the railroad
mileage of the United States is now in the
hands Of the courts, and being administer
ed by receivers. Even in states with such
unuuestioned credit as New York, Con-
nccticut and Massachusetts, the New Y rh
and New England railroad has recently
Joined the recaiYership procession, in which
it marches side by side with some OF the
greatest railroad systems Of the New
England, Middle, western and Pacific
states.
And yet the great financial firm OF DreX-
Ell, Morgan & Co, one of the strong
est banking institutions on earth, did not
stop to decry the credit CT the southern
sAates when it signifed its Willingness to
undertake. the reorganization OF the East
Tennessee, Virginia and Georgia, ana the
Richmond and Danviile systems. which ira
verse the states of Virginia, North Carroll
ma, South Carolina, Georgia, alabama, Mis-
sissippi and Tennessee. If this giant
among financial establishments does nor
know today whose credit is good, then it
Is not worth while for Mr.. Hume and my
self TO discuss it foz the purpose of throw
ing light on the subject.
1t is a fact not generally known that an
attorney general OF New York delivered
an opinion III which ne stated, officially,
that, after a careful investigation CT the
facts, he saw nothing that should in any
wise impair the credit of the state of Geor
CHA. I refer to the decision OF Attorney
General O. Brien which was extensively cir
culated when rendered, and which was
given as the result OF a call for his con-
struction of statute Of New York,