Evening star., 1896-07-02
HAWAIIAN FINANCES
Probable Refunding Of the Little
Debt Of the Republic.
IT Can Be PLACED At -FOUR PER CENT
interesting Study Of the Peculiar
Lava Ducts.
STORY OF KATE ED

Special Correspondence of The Evening Star
HONOLULU, June 49, 1896.
The most important recent event has
been the resuscitation Of the supposed
ly dead refunding bill in a new form.
After all, we are going to try to
get the entire Hawaiian debt taken
up in London at per cent. This
new attempt in that direction is due
to action taken by a leading financier,
Peter Cushman Jones, who was the first
minister Of finance in the provisional gov
ernment. On the Goth of May Mr.. Jones
communicated, through Finance Minister
Damon. to the legislature the fact that
he had obtained from Rithet & Company
of Victoria, B. c., representing a number
of capitalists, a proposition to place four
million dollars Of Hawaiian bonds in the
London market at per cent interest, al
loving a discount of per cent on the
principal, with per cent commission.
This proposition was SO much more ia
vorable than the original one of Mr..
Damon which had been tabled two months
before, that the legislature eagerly enter
tanned 1t, and took up the old bill from
the table to make the necessary changes.
AS the regular ninety days of the session
which the constitution allows were nearly
expired, the president was also induced to
grant an additional ten days time out of
tho thirty which he is empowered to do.
The legislature has actively taken up the
business. which will go through promptly,
although both Mr. Damon and Mr.. Jones
are leaving by this mail steamer.
AS previously reported in my letter, of
April 2, Mr.. Damon's proposition was to
offer four per cent bonds in London at
the heavy discount of fifteen per cent
with a commission in addition Of 21a per
cent. Such a loss Of IL 4 cent look ed
alarming to our legislators, and they could
not be induced by Mr.. Damon to sanction
his plan. although he clearly showed that
1t would result In large reduction of the
interest now paid. In this opposition they
were encouraged by the opinions of lead
ing Honolulu financiers, and especially that
of Mr.. P. c. Jones, that much better terms
could be obtained for our bonds, If not at
sacrifice as that proposed was unnecessary.
Many at the time believed that Mr.. Jones
and the others were more or less Influenced
in their opposition by q natural reluctance
to see rates of interest in Honolulu decline,
especially as sugar dividends were giving
them large sums for investment and gov
ernment bonds at 5 instead of per cent
would be extremely desirable.
Refunding at 4 Per Cent.
Mr.. Jones may now be said to have clear
ly vindicated both his sagacity and his dis
interestedness. He has proved that his
opinion was correct, that Hawaiian 4 per
cent bonds could be sold at moderate dis
count. He has also proved that he was
entirely willing to have the public interest
thus served. Mr.. Jones was minister of
finance in the Wilcox-JoneS reform cabinet
Of December, 1892, just before the dethrone-
ment. This was the cabinet so offensive
to the queen, which she was at so much
pains to bribe legislators to remove at the
close Of the session, in order to get rid Of
OllSracla to the 1'afat which q
attempted on the 14th Of January, 1893.
Her then attempt to get in despotic con-
sutution was frust rated through the en-
ergy Of Thurston and his patriotic asso-
clates. The queen was dethroned, and a
provisional governinnh. formed, in which
P. c. Jones became again minister of
finance under President Dole. He was one
of the four leaders who quietly marched
up on the 18th January and took posses
sion of the government building, while
their armed supporters were running up
from their rendezvous in the opposite direc-
tion. Mr.. Jones. however, was prevented
month.
No man was more on the inside of public
affairs than P. c. Jones just before and
during the days Of that revolution No
mans testimony as to what was then TAX
ing place could possibly be more important
both on account Of his intelligence and
probity, and on account of his official par
tlcipation. No one action Of Commissioner
James n biount was more offensive to our
people than his neglect or refusal to take
the testimony of Mr.. Jones, such q chief
actor. Jones, however, afterward testified
before Senator Morgan's committee, in
February. 1894, having gone to Washing
ton for that purpose, as Mr.. John L. Ste
vens likewise did, whose testimony also
Mr.. Blount had omitted to take.
Public improvements.
Another financial measure. just COM
pleted, is loan bill for public improve
ments, amounting to over 100000, to be
executed during the current biennial
period. This has nearly become a law, but
may now require a change in view Of the
new and favorable prospect of obtaining
money in London at 4 per cent. 1t was
provided that the bonds should be sold in
Honolulu at per cent interest Some of
our financiers have expressed the opinion
that they would sell at par here, even II
with AZ interest. 1t is becoming very evil
dent that Hawaiian government credit is
excellent and advancing. 1t certainly de-
serves to be good. The Hawaiian govern
ment has always met it's obligations un-
failingly and promptly. The country is
wealthy and productive. This years ex-
port of sugar will amount to SIS 5OO0, 600, of
which one-third will be net profit The
whole product represents $3.50 apiece for
every head of our population. There is
certainly basis for good financial credit
The expenditure of $500, 900, as proposed, is
urgently demanded for the proper and eco
nomical growth of the country. Perhaps
half of this is for new wagon roads, which
will at once raise or rather create land
values The proposed $50 miles of new and
good road means 100000 acres of land of
present merely nominal value, raised to an
average value of $50 an acre. or S., ,OOO, ,OOO
yielding tax Of $4,000, which will nay
three or four times the interest on the
sum borrowed for the work The other
improvements will be remunerative in great
er or less proportion. This Is good business
management. Not to adopt such a meas
ure would indeed be criminal neglect of the
proper development of the country.
A recent visit of officials and legislators to
the leper settlement brings fiattering ac-
counts of the prosperity and comfort of that
unfortunate colony. There is no COM
munity Of natives in these islands which
is living in one-half the comfort and abund-
ance which is enjoyed by these wards Of
the nation, without the trouble of earning
1t. The villages are very attractive both
as seen from sea and on close inspection
A new improvement is the setting out of
numerous trees. now in progress. An ex-
perienced nurseryman has this year started
several ten thousands Of young trees, which
are being set out.
A part of these are pandanus, iron-wood
and milo, to be grown along the seashore
as breakwind. These kinds do not suffer
from the sea spray, which blows upon the
land, and destroys all but few kinds of
trees near the shore.
Tn q T.ovo rnof