The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1895-04-06
CONTRASTING FINANCIAL POLICIES.

The Sentinel, after asserting that the
Harrison administration left the United
States treasury practically bankrupt, is
forced to admit that it reduced the in
terest-bearing public debt $259,07 800. but
adds that "it had the benefit of the
handsome surplus left from Mr.. Cleve-
lands former administration Mr.
Cleveland also inherited surplus from
the Arthur administration, but he did
not believe in applying the surplus to a
reduction of the public debt. The policy
of the Harrison administration was to
reduce the public debt rather than to
hand over a surplus to it's successor.
As a result of the large reduction of the
interest-bearing debt the annual inter-
est account of the government was re-
duced during the Harrison administra-
ton 81, 6S4, 469. At the beginning of the
Harrison administration the govern
ment's interest account was 60 cents a
year for every man, woman and child
in the United States; at the close of
the administration it was 81 cents a
year.
Mr.. Cleveland thought it better finan-
cfering to accumulate a surplus than to
reduce the Understanding OeDL. LII Ills
annual message of 1887 he said:
In considering the question of purchasing
bonds as a means of restoring to circula-
ton the surplus money accommodating in
the treasury it should pc borne N IN mind ni
upon such purchase, that there may be a
large part of these bonds held as invest
mentS which cannot be purchased at any
price, and that combinations among holders
who are willing to sell may unreasonably
enhance the cost of such bonds to the gov
eminent.
By such arguments as this and by
raising imaginary difficulties Mr.. Cleve-
land justified his policy of accommodating
an idle surplus and depositing it in the
national banks. On the other hand,
President Harrison in his first annual
message said:
pose of anticipating our bonds beyond the
requirements of the sinking fund, but any
Incorporated surplus in the treasury
should be SO used, as there is no other law
full way of returning the money to cIrcula-
ton, and the profit realized by the govern err
loaning of public funds to the banks with
out interest, upon the security of govern
ment bonds, / regard unauthorized
and dangerous expedient. No fur
Their use should be made of this method of
deposits now outstanding should be grad
ally withdrawn and applied to the pur-
/, of bonds.
the policy IHuS IOTeSuduOMeu, VIZ,
that of Withdrawing the surplus from
the national banks and applying it to
the reduction Of tie Understanding
debt, was put in effect Immediately.
In his next annual message, that of 1890.
President Harrison said:
The effo-ts of the Secretary of the Treas
in circulation by keeping down the treasury
surplus to the lowest practicable limit nave
been unremitting and in very high d; degree a;s
cuation during the nineteen months mas
been in the aggregate S93, 500, Sl3, or aoout
$7 100000 was due to the recent silver legis-
lation That this substantial and needed
aid given to commerce resulted in an enor-
NOUS reduction of the public debt, and OF
the annual interest charge is matter or IN
crea sed satisfaction There have been pur.
chased and redeemed since March 4, 1889,
and AZ per cent. bonds to the amount or
s2i ss2 49, resulting in the red1et i6n of the
annual interest charge of $685.. Coy, ana
total saving of interest of $ol.5i67oo
This policy was continued till the
close of the Harrison administration, re-
sulting, as already stated, in reduc-
ton of the governments interest ac-
count of 81, 6S4, 1859 a year. The people
still get the benefit of this reduction
every year and every day of the year.
The Sentinel says: 'Itwould have been
better if President Harrison had not
bought so many bonds and had left
| more money in the treasury. Better,
perhaps, for the present administration,
but not for the people. The real bank
| ruptcy of the treasury began with the
| free-trade agitation and reduction OF
| revenue that preceded and followed Mr.
| Cleveland's election and that brought on
| the panic OF 1898.