The united opinion. [volume] (Bradford, Vt.) 1881-1970, 1896-01-10

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that amendment had become law, the
secretary could easily have maintained the
reserve and met deficiencies as they occur
red by the proceeds of the bonds described
In it.
Reduced Revenues Caused Deficiency.
Nor would deficiencies have occurred
! had not the president and both houses of
the Fifty-third congress, then in political
sympathy, united in passing a law reduc-
ing the revenue below expenditures for the
first time since the close of the war and
compelled the executive authorities to APP
ply fund created for the redemption of
United States notes to meet the ordinary
expenses of the government This dem
onstrated fact is the source and foundation
of all our present financial difficulties.
I do not wish to criticise the sales Of
bonds authorized by the resumption act to
meet these deficiencies. Under the circum-
stances the administration was justified in
doing this. even to the Impairment of the
resumption fund, but 1t ought frankly to
say that the cause of the invasion of the
resumption fund was the deficiency of rev.
enue created by faulty tariff legislation by
the last congress
Such deficiency Is discreditable to the
, United States, with its vast wealth and
| resources. There is no difficulty in collect
| ing by taxation all and more money than
| is necessary for its expenditures. 1t is hui
initiating to read in the newspapers of the
| day that our government is negotiating
| for money from associated bankers, and,
| like a distressed debtor in view of bank
| ruptcy, is offered by a friendly power its
accumulated gold to relieve us from our
supposed financial distress. The true rem
edy is 10 supply by taxation in some form
| additional revenue, and, until this can be
effected, to borrow from the people of the
| United States enough money to cover past
and future deficiencies. This done, gold
will readily be exchanged for United
States notes. as was done from January,
1879, to the election of Mr.. Cleveland.
The two defects in existing law relating
to redemption are mentioned by the pres
| ident:
First. THAT the notes presented for re-
demption must be reissued 1t seems from
the newspapers that he has found the pow
er to hold notes redeemed until they can
be exchanged for coin, discovery that he
| should have made sooner.
Second That the resumption fund is a
part of the general balance in the treasury
and may be applied to current expendi-
| lures.
Congress neglected to cure the defects
| pointed out by me as secretary of the
treasury in $780, but I hope will correct
| them now at the request Of the president.
1t was not then anticipated that a def
| cheney of revenue would occur or that If
it did occur the government would use
fund specifically pledged for another pur-
pose to meet current liabilities.
Redemption of Notes.
Notes once redeemed should only be re-
issued for gold coin, and such reissue
should be mandatory when coin is depos-
tied in the treasury. With this provision
Of law the scarcity of currency would
create such demand for it that gold would
| DO freely deposited in exchange for the
more portable and convenient notes of the
United States. The resumption fund
should be segregated from all other mon
eys of the United States and paid out only
in redemption of United States notes.
With such provisions in the law the re-
sumption fund could not be invaded to
meet deficiencies in the revenue. They
should be provided for by bonds or certifl-
Gates of Indebtedness of small denomina-
lions at low rate of interest, which would
be readily taken by tho people through ma
tional banks, subtreasuries and postoffices.
There seems to be a misapprehension of
the difficulties of maintaining the redemp-
ton of United States notes. The nominal
value of these is 1916, 6S1 ,016. This is the
reduced volume from the maximum out
standing during the civil war of $3.50, 000,-
900 But this sum of S346, 600, 600 includes
all the notes lost and destroyed by casual
ty since tho first issue in 1862 The amount
1. 7, I,oo +ol
900 to $40, 600 900, reducing the notes that
could be presented to $500, 900, 900 or less.
The national banks in certain large cities
are required TO keep Oh hand in lawful
money of the United States an amount
equal TO at least 25 per cent of the aggre-
gate amount of their notes in circulation
and their deposits, and all other banking
associations are required at all times to
have on hand in lawful money of the
United States an amount equal to at least
10 per cent of the aggregate amount of
their notes in circulation and of their de-
posits.
AS the term "lawful money" includes
gold. coin there is disposition by timid
bark to convert their United States notes
into coin, thus aiding in depicting the re-
demption reserve. This ought TO be pre-
vented by provision Of law that the bank
reserve CT lawful money shall be United
States notes or treasury notes only. Ma
tional banks arc the creation and instru-
ments of the government and ought not
to bo allowed to discredit the money with
which they can redeem their own notes,
nor should the government itself be per
mitted in any way to weaken the credit
and confidence of the people in their paper
money by using it for current expenses in
excess of current revenues.
1t is practical fraud for the govern
mcnt to use these notes for such purposes,
and ii never has been done except during
this administration. Every dollar thus
taken is an impairment of the redemption
fund. 1t is the misapplication of fund
specially created by law for another pur-
pose The effect Is to destroy confidence in
the credit aud safety of our paper curren-
CIV. 1t has led to the demand for gold coin |
for the United States notes. / do not be- |
lieye that has been the design Of the exc |
cutive branch of the government, but that |
has been its effect, and it should be prevent |
ed by tho immediate action of congress. |
The resumption fund is the safeguard OF |
the money of the people, and its use for |
any other purpose is a practical repudia-
tion of the public faith.
The president complains that the notes
are presented and paid, reissued and paid |
AGAIN p,atipg "a coptinnouS circuit When /