The San Francisco call. [volume] (San Francisco [Calif.]) 1895-1913, 1895-07-22
Forced to Bond Issues to Re-
store the Necessary Gold
Surplus.
IN THE GRIP OF A SYNDICATE.
Credit OF the United States Now in
the Control of Wall-Street
Capitalists.

ington special to the Press says;
When an individual spends more than
he earns he is compelled to draw upon his
capital or borrow money. This is what
the United States Government has been
doing under Democratic management for
the past two years and five months.
From the day the Republicans surren-
dered control of the executive and leglsla-
tive branches of this country there has
been a change for the worse in the condi-
ton OF the public treasury. Up to that
time the gold reserve was unimpaired, the
surplus comfortable, the National debt in
the process of reduction, and American Sc
curities commanded a premium every
where.
Since then the revenues have fallen
steadily off the gold reserve has thrice
been invaded; the National debt has been
increased and our bonds deprecated
through a disgraceful deal with foreign
syndicate, which profted SIC, 1000 900 by the
transaction. This syndicate now controls
the credit of the United States and in ad-
dition levies a toll upon all American i'm
ports and exports through the medium of
foreign exchange.
The shock to trade by a Democratic vic
tory was the natural result Of threat
ened attack upon the protected industries
and the upsetting of all values. Business
was paralyzed through the dread OF the
unknown, and the Government, thus de-
prived of its accustomed revenues, was
driven to the verge of bankruptcy.
To get money to pay its bills, the United
States, under the new order of affairs, was
compelled to borrow money. This money
was ostensibly procured to restore the gold
reserve, but the gold which had been
boarded with such jealous care under q
Republican administration for the redemp-
ton of United States notes, was actually
used by the Democratic administration in
paying current obligations.
The close of the first fiscal year of the
Cleveland administration disclosed the
fact that the expenditures of the Treasury
Department had exceeded the receipts by
$40, 100000. This 100000 came out of
the cash on hand, but in the treasury
method of bookkeeping, it makes no show
ing at the beginning of new fiscal year
A fresh balance sheet is started the 1st
of each July. When the second year of
the Cleveland administration passed there
was another deficiency of $43 900, 600. This
would have been much worse had not
every device been resorted to in order to
withhold the payment of money and to
hoard the receipts.
With the beginning of the third year
Democratic rule deficiency is already
exhibited of nearly $4,000, 900, but which,
by the usual Juggling of accounts now
understood, will be cut down to about
co O00 00A hofOra ba CT IF
The three deficiencies so far, therefore,
amount to about $125, 100000 in round
numbers. To make that amount good the
amateur financiers had to borrow and will
have to borrow more.
The Democratic tariff law is failure as
q revenue producer. Had it been passed
as originally framed in the House the def
cheney would have been greater by SIC, 00O,-
600 than it is to-day. Fortunately much
of the free trade in it was wiped out by the
Senate, but not enough.
The bond operation, which increased the
National debt for the first time since the
War of the Rebellion, was sale Of. $780,
100000 per cents, having ten years to
run. This meant an interest payment on
this transaction of $25, 10000 The second
bond sale was also a $50, 900 lot of
per cents, having nine and half years to
mature and involving an added interest
charge of 1913, 10000.
The third deal In bonds was through a
syndicate, which took So, 315, 400 at per
cent, for thirty years, equal to 12O per cent.
The premium paid for the bonds was much
lower than the market price then ruling,
and almost 20 per cent less than they COM
mand to-day. The interest on these bonds,
when paid in full, will amount to
S74, 77S, 480.
Thus we have an increase in the princi-
pal of the public debt of S152, 315 400 so far,
upon which $123, 52s,4 80 of interest must be
paid The bonds and interest at maturity
will cost the people of the United States
$235, $3.50, $50.
When attention was first called to the
startling magnitude of these figures, de-
fciency of $4,000 900 existed, which in the
natural process of replenishment, will
have to be made good by another bond sale
or an improvement in the receipts.
1t is thus shown that the Democratic
method of conducting the affairs of the
Treasury had cost 1886 900, 900 before the
close of the second fiscal year.
The beginning OF new fiscal year dis
poses of the old deficiency so far as book
keeping is concerned, and from the record
to-day the debt and interest which has
been added to the burdens of the people,
is $2S5, 833, $50.
When another bond sale is made neces-
sary by the past deficiency, and that now
appearing, the Press figures of $685., 000,-
COO will be more than verified.
Another way to understand the increase
of the National debt is to show what it will
cost yearly to pay the interest on the
money which the Democrats have had to
borrow to carry on the Government of the
richest people on earth.
The three bond sales under President
Cleveland require the payment annually
of ST. 492, SIC in interest. This sum, divided
into days, means a daily interest charge of
$20,514, SO that if the principal of 1852, 315,-
400 is stated and $20.514 added for every
day, the gradual increase of the debt will
be shown.
Six months have passed since the last
bond sale, although the bonds have not
commanded interest all that time More
than years accumulations are charged
to the first sale. 1t will be emf
nently fair, therefore, to calculate