Richmond dispatch. [volume] (Richmond, Va.) 1884-1903, 1897-12-07

PROTECTION FROM BOND ISSUES.
1T is manifest that we must devise
some plan TO protect the government
against bond issues for repeated redemp-
tons We must either curtan the op-
portunity for speculation, made easy by
the multiplied redemptions of our de-
mand obligations or increase the gold
reserve for their redemption. We have
S9o0.WOOOO of currency. which the gov
eminent by solemn enactment, has un-
dertaken to keep at par with gold. No
body is obliged to redeem in gold but the
government. The banks are not required
to redeem in gold. The government Is
obliged TO keep equal with gold all It's
outstanding currency and coin obliga-
tions. while its receipts are not required
TO be paid in gold. They are paid in
every kind of money but gold, and the
only means by which the government
can, with certainty. get gold. is by bor-
rowing. II can get it in no other way
when IL most needs It, The government,
without any fixed gold revenue. is pledged
20 maintain gold redemption, which it
has steadily and faithfully done, and
which, under the authority now given,
it will continue to do.
'The law which requires the govern
ment, after having redeemed its United
States notes, to pay them out again as
current funds, demands a constant re-
Punishment Of the gold reserve. This is
especially so at times of business panic
md tfrhn h. ar fFiff9n
TO meet the expenses of the government.
At such times the government has no
other way TO supply its deficit and main
tain redemption but through the increase
OF its bonded debt, as during the admin
istratiOn of my predecessor, when S262-
Sl5.400 OF l-2 per cent. bonds were issued
and sold, and the proceeds used to pay
the expenses of the government in eX-
cess Of the revenues and sustain the gold
reserve.
while ii is true that the greater part
Of the proceeds Of these bonds were used
to supply deficient revenues. consde
rable portion was required to maintain
the gold reserve. Without revenues
equal TO our expenses, there would be no
deficit requiring the issuance of bonds,
| but If the gold reserve falls below $780,
OOO,O0O how viii it be Teplenished except
by selling more bonds? is there any
other way practicable under existing
law?
'The serious question, then, IS: Snail
we continue the policy that has been
pursued in the past-that is, when the
gold reserves are at the point of danger,
issue more bonds and supply the needed
gold-or shall we provide other means TO
prevent these recurring drains upon the
gold reserve? If no further legislation is
had, and the policy of selling bonds is TO
be continued, then Congress should give
the secretary of the Treasury authority
to sell bonds at long or short periods,
bearing less rate Of interest than is now
authorized by law.
NOTES FOR GOLD ONLY.
Il earnestly recommend as soon as the
receipts of the government are quite suffi-
cient TO pay all the expenses of the
government, that when any of the United
States notes are presented for redemption
in gold and are redeemed in gold, such
notes shall be kept and set apart, and
only paid out in exchange for gold This
is an obvious duty. If the holder OF
United States notes prefers the gold. and
gets it from the government, he should
not receive back from the government
a United States note without paying gold
in exchange for it. The reason for this
is made all the more apparent when the
government issues an interest-bearing
debt TO provide gold for the redemption
of United States notes-a non-interest-
bearing debt. Surely, it should not pay
them out again, except on demand, and
for gold If they are put out in any
other way, they may return again. TO be
followed by another bond issue TO redeem
them-another interest-bearing debt to
redeem a Notwithstanding debt
In my view, 1t is of the utmost i'm
portance that the government should be
relieved from the burden Of providing all
the gold required for exchanges and eX-
port. This responsibility is alone borne
by the government, without any of the
usual and necessary banking powers to
help itself. The banks do not feel the
strain of gold redemption. The whole
strain rests upon the government, and
besides the gold reserve in the Treasury
has come 10 be. with or without reason,
the signal of danger or of security. This
ought to be stopped. If we are to have
an era Of prosperity in the country, with
sufficient receipts for the expenses Of the
government, we may feel no immediate
embarras ssment from cur present currency,
but the danger still exists, and will be
ever present. menacing us, so long as the
existing system continues. And, besides
it is in times OF adequate revenues and
business tranquility that the government
should prepare for the worst We can
not avoid. without serious consequences,
the wise consideration and prompt solu-
ton of this question.
SECRETARY CAGES PLAN.
"The Secretary of the Treasury has
outlined a plan in great detail, for the
purpose Of relieving the threatened re-
currence Of a depleted gold reserve, and
save us from furture embarrassment on
that account To this plan l invite your
careful consideration
Il concur with the Secretary OF the Trea-
sury I'm his recommendation that national
hanks be issued notes to the face value
of the bonds which they have deposited
for circulation, and that the tax on the
circulation of notes secured by the de-
posit of such bonds be reduced 10 one
half of / per cent. per annum. / also
ioin him In recommending that authority
he given for the establishment of ma
tional banks with minimum capital OF
S25 600. This will enable the smaller VIII
lagos and agricultural regions OF the
country TO be supplied with currency TO
meet their needs i recommend thal the
issue OF national bank notes be restricted
TO the denomination OF $40 ana upward
II the suggestions / have herein made
shall have the approval OF Congress, then
/ would recommend that national banks
be required TO redeem their notes IN
gold. -.,,,.,o,,
CUBAN QUESTION.
Turning to foreign affairs, the Presi-
dent devotes a great part of his message
10 a consideration of the Cuban question: