St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1896-01-04
ALL KINDS OF BONDS
Continued From First Page.

for time, they were interconvertible
into bonds bearing interest payable in
bonds"
Senator Sherman read from Secre-
tary Carlisle's report to show that
prior to 1891 the demand for coin for
United States notes, during a period
of thirteen years from July l, 1872, to
July /, 1892, was only a little over $42,-
100000, while the receipts of gold for
United States notes during the same
period amounted to s160,O00,0 900. With
drawals of gold from July, 1892 to De-
cember, 1895, have amounted to $780,
100000. During the first term of Mr..
Clevc and, the speaker continued,
when he was powerless to affect our
currency and tariff policy, the senate
being Republican, the gold increased
from S240,000,000 on the 1st of April
1885, to $320,000000 on the 1st Of April
1889. This gold came into the treasury
without cost, in exchange for United
States notes or gold certificates ''It
is just to Mr. Carlisle to say that he
attributes the withdrawal of gold to
silver legislation, yet the Bland-Alli-
son act was in force from 1873 to 1890,
when the accumulation of gold oc-
CURED, and the great body Of gold
was Withdrawn after the act of July
IA, 1890, was repealed" Mr. Sherman
continued:
CAUSE AND REMEDY.
''In view of these official facts, can any
fair man doubt as to the cause Of our finan-
cial condition? What other be
stated than that unwise Legislation reduced
our revenues below expenditure, i'm
paired confidence in our ability to maintain
our currency at par, and compelled the gov
erDment to sell bonds provided for the
demption of United States notes in order to
meet deficiencies? What other remedy is there
for our financial difficulties, except to borrow
money on the best terms possible to pay cur
rent deficiencies and to provide additional
revenue for future wants? To this extent and
for these purposes l am willing to support
this administration, however much 1 may
disagree with it's general policy But the
president is not satisfied. He demands the
retirement and cancellation of all the United
States and treasury notes by the sale OF
bends of the United States bearing interest.
II this policy is adopted, to compel the people
of the United States to surrender the best
paper currency they have enjoyed, it
will fail. If revenue is wanted to meet cur
rent expenditure it will be furnished either
by taxation or by borrowing or by both. but
to create deficiencies in order to compel the
cancellation of United States notes by the
issue of bonds will not, in the language of
the president, meet with legislative APP
prevail
The deficiency would not have oc-
CURED, Mr. Sherman insisted had not
the president and both houses of the
t1fty-third congress, then in political
sympathy, united in passing a law re-
ducing the revenue below expenditures
for the first time since the close of the
war;
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 re-
sumption fund, but it ought frankly to say
that the cause of the invasion Of the resump-
ton fund the deficiency Of revenue Gre
ated by faulty tariff legislation by the last
congress. The true remedy is to 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 jan
uary, 1872 to the election of Mr.. Cleveland.
TWO DEFECTS.
''The two defects in existing law relating
to redemption are mentioned by the president:
First, that the notes presented for redemp-
ton must be reissued. 1t seems from the
newspapers that he has found the power to
hold notes redeemed until they can be ex-
changed for coin, discovery that he should
have made sooner.
Second, that the redemption fund is part
OF the general balance in the treasury and
may be applied to current expenditures.
Congress neglected to cure the defects
pointed out by me, as secretary of the treas
now at the request Of the president. 1t was
not then anticipated that a deficiency of rev.
enue would occur or that if it did occur the
government would use a fund specifically
pledged for another purpose to meet current
liabilities. Notes once redeemed should only
be reissued for gold coin, and such reissue
should be mandatory when coin is deposited
in the treasury. With the provision of law,
the scarcity of currency would create such a
demand for it that gold will be freely de-
posted in exchange for the more portable and
convenient notes of the United States. The
resumption fund should be segregated from
all other moneys of the United States and
paid out only in redemption of United States
notes. With such provisions in the law the
resumption fund could not be invaded to
meet deficiencies in the revenue They should
be provided for by bonds or certificates of in
debtedness Of small denominations at low
rate Of interest. which would be readily taken
by the people through national banks, sub
treasures and p9stofiices. AS the term law
full money includes gold coins. there is dis
position by tmd banks to convert their
United States notes into coin, thus aiding in
depicting the redemption reserve. This
ought to be prevented by provision Of law
that the hank reserve of lawful money shalt
be United States notes or treasury notes
only. The resumption fund is the safeguard
of the money of the people, and its use for
any other purpose is practical reputation
of the public faith.
"The president complains that the notes
are presented and paid reissued and paid
again and again. making continuous cir
cult. When did this circuit commence? The
only answer is. when this administration,
supported nv the last congress. created de-
ficiency. Why does the circuit continued It
is because the deficiency continues. The gov
eminent resorts to the financial policy of
debt paid, but the circuit continues. The
money received for current revenue. is paid
to cover deficiency, and is returned for gold,
and then more bonds.
APPLY THE REMEDY NOW.
''The secretary hopes that in two or three
years there will be deficiency. What is
the ground for this hope? Is it that a new
administration will provide more revenue,
and then the circuit will be broken? Why
not, then, apply the remedy now. The pres
ident is of the opinion that United States
notes and treasury notes should be retired
and give place to bank notes. This is a
question for congress to decide. 1t is certainly
not Of that opinion now, nor was the last
congress of that opinion. / believe that under
existing law the aggregate sum of United
States notes and treasury notes issued under
the act of $780, amounting to about $3.50, 000,-
600, can be easily maintained at par with coin
If the two amendments l have mentioned are
adopted by congress-
In conclusion Senator Sherman said: "a
careful study of the system of banking cur
rency and coinage adopted by the principal
nations of Europe convinces me that sys-
TEN, when cured of few defects deVeloped
by time, founded upon the bimetallic coinage
of gold and silver. maintained at par with
each other, with free national banks estab-
lished in every city and town of Importance
in the United States issuing their notes, Sc
cured beyond doubt by United States bonds
or some equivalent security, redeemable on
demand in United States notes. and the issue
OF an amount of United States notes and
treasury notes equal to the amount outstand-
ing with this provision for a rateable in
crease with the increase Of population al
ways redeemabe in coin supported by an
ample reserve Of coin in the treasury not to
be invaded by deficiencies of revenue and
separated by the subtreasury system from
all connection with the receipts and expend-
lures OF the goyernment-such system
would make our money current in CONNER
clal circles In every land and Cline better
than the best that now exists in Europe bet
ter than that of Great Britain. which now
n he T