The record-union., 1895-12-17

business conditions of the country, and
a proper legislative and executive super
vision over expenditures, the revenue
laws now in force will, in my opinion,
yield ample means fer the support of
the public service upon the basis now
established; and upon the assumption,
which seems to be justified, that the
progress now being made toward the
restoration of our usual state of pros
perity will continue without serious in
terruption, it is estimated that there
will be a surplus of nearly 81 100000
during the fiscal year 1897.
During the fiscal years 1874 and 1893
the ordinary expenditures of the Gov
eminent have been decreased So, 2S2, :
656 20, as compared with the fiscal year
1893, and it is believed that with the CO.
operation of Congress further reduc-
tions can be made in the future without
impairing the efficiency Of the public
service.
In regard to the bond issues, Secretary
Carlisle says: Between the lst day of
February. 1894 and the 10th day of
March, 1895, three issues of bonds were
made, amounting in the aggregate to
S162, 315, 400. The payments into the
treasury on account of the second bond
sale were not entirely completed until
after the 1st day of December, 1884, and
it soon became evident that the transac-
ton had not been effectual to stop the
drain of gold. On the Sth day of Febru-
airy, 1895, the reserve had been reduced
to S41, $40, 1S1, and several million more
had been demanded, part of which was
taken out and afterward returned to
the treasury on account of the tempo
rary restoration of confidence resulting
from the fact that 1t became generally
known that measures were about to be
taken for the replenishment of the re-
serve"
Detailing the amount of bonds issued
and gold received, the Secretary pro-
ceeds as follows:
THE beneficial effects of this trans
action were felt Immediately, not only
in this country, but in every other hav-
ing commercial or financial relations
with our people. Confidence in our Sc
curities as safe as profitable invest
ments were at once restored 10 such
an extent that bonds were returned TO
our market for sale, and very conslo-
cradle demand for securities was ere
ated abroad.
But the most gratifying evidences
of Improvement in our condition were
afforded by the revival of business
among our own people, the increased
activity and extension of our domestic
industrial and commercial operations,
the rise in the prices of our principal
agricultural products, and the general
feeling of relief and security which be-
came apparent in every part OF the
country. These encouraging indica-
lions of increasing prosperity still con-
tinue, and it is reasonably certain that,
if our progress is not checked by aerepe-
tition of the demands upon our re-
sources. or by failure to meet the just
expectations of the people in respect to
the reformation of our fiscal system
we are entering upon an era OF material
growth and development not surpassed
in our history.
But" adds Secretary Carlisle, 'our
further progress trward a complete res
toration of confidence and prosperity
is seriously impaired by the defects In
our currency laws.
The remedy which Secretary Carlisle
proposes for the financial ills is thus set
forth:
There is but one safe and effectual
way TO protect our treasury against
these demands, and that is to retire and
cancel the notes which constitute the
Only means through which the with
drawals can be made. Many partial
and TEMPORARY remedies may be Sug-
gested and urged with more or less
FEASIBILITY, but this is the only one
that will certainly remove the real cause
of our troubles and give assurance OF
permanent pTOlSCliOI d5o1AiSI 'ANiA -
currence in the future.
.Drhis can be most successfully and
economically accomplished by author
izing the Secretary Of Treasury TO issue
from time to time bonds payable IN
gold. bearing interest at rate not ex-
ceeding 3 per cent. per annum, ana nav
ing a long time to run, and to exchange
the bonds for United States notes ana
Treasury notes upon such terms as may
TO- rnn IN the Govern
mont or sell them abroad for gold,
whenever in his judgment 1t is adVls-
able to do so, and use the gold thus Cd
tanned in redeeming the outstanding
notes. a..
substitution of the other currency Ior
the retirement of legal tender notes,
the national banks should be author-
lied TO issue notes equal in amount TO
+he face value of bonds deposited TO Sc
c,ire them. and the tax on their c1rcu-
lation should be reduced one-fourth of
! per centum per annum. When the
national banking system was estaD-
lished the bonds of the United States
were selling below par in the market,
and there was consequently Sufflclent
reason for limiting the amount or notes
to be issued to 30 per cent. of the face
value of the securities deposited, but
exist, and the limitation should be re-
| moved.
LAS a part of the plan for the re-
dannption and retirement of the legal
! tender notes, the treasury should be re-
/ lieved from the responsibility for the
redemption of national bank notes, ex-
| cept worn, mutilated and defaced notes
and the notes of failed banks, and each
| association should be required to be
-.as,-o lott Of
/ office and agencies to be designated by
| the Comptroller of the Currency, as
was the case prior to the passage of
/ the Act of June 20 1874; or, if this is
not considered expedient, and the pres
| ent system of current redemption by
! the treasury is considered, the Secre-
| tary of the Treasury should have the
power to require the banks to keep their
! : per cent. redemption fund in gold
/ coin, and to deposit gold coin for the
withdrawal of bonds whenever circula-
! ton is to be permanently surrendered
! or reduced.
1T is not probable that any plan for
| the permanent retirement of United
! States and treasury notes will be
adopted that will not require consider
| able time for its complete execution and
| l therefore respectfully urge upon Con-
| gress the propriety of prohibiting any
! future issues of such notes, or Of ma
] tional bank notes of less denomina-
! tions than so. The reasons for this
recommendation have been fully stated
/ in former reports and need not be re-
peated here. Such policy would make
/ room in the circulation for silver coins
/ and silver certificates of small denom-
! nations. thus increasing their use in
the transactions of daily business and
! preventing the frequent return to and
| accumulation in the treasury.
THE large silver certificates now out
standing could be retired and Cancelled
when received and smaller ones substi-
| tuted for them, so that there would
be no diminution Of small currency in
i circulation, and the ultimate result