The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1898-04-21

1t seems to be settled that the govern
ments financial scheme for carrying on the
impending war will include a popular loan
of $500, OO0, 0OO based on 3-per-cent. five
twenty bonds-that is, redeemable at the
option of the government after five years
and payable in twenty years. The only
alternative to making loan is either to
raise the necessary revenue by increased
taxation or to issue paper money. The lat
ter is not to be thought of, and the former
would involve an elaborate and burdensome
system of taxation, and would not meet
the immediate wants of the government.
Taxation would not furnish money to buy
powder, pay the army and navy and carry
ON war. There must be loan, and by all
means it should be a popular loan. This
plan is favored by the treasury authorities,
and very wisely. The assistant secretary
of the treasury said in a recent interview:
You can safely say that the intention ev-
eryWhere is in case a loan becomes neces-
sary, to give the greatest possible facility
bonds. The bonds will presumably be IN
sums of $50 and multipleS, and Will be avail
able to any and all who may choose TO seno
checks drafts. money orders or any other
device for transmitting money, or who may
prefer to deposit the money with their
banker or a subtreasurer IN their vicinity:
The bonds undoubtedly will be offered at
par in sizes and quantities to suit all pid-
ders, and every citizen who desires to assist
the government in raising money or VINO
desires to invest his money and become
bondholder will have full opportunity.
This would be a genuinely popular loan,
one accessible to all classes in every part
Of the country. There can be no doubt that
MI
The greater part Of it could be placed in
large sums or with banks and money insti-
tutions, but no doubt it would be the policy
of the government to give small bidders the
preference, thus distributing the loan as
widely as possible and making it truly pop
ular In the present prosperous condition
of the country, with the large amount of
money in circulation, such a loan would
probably be taken up as fast as it could
be handled. 1t is understood that the bonds
will be as low as $50, with higher multiples
of that sum. A smaller bond than $50 would
be inconvenient for the Treasury Depart
ment to handle, and would also be objec-
tionable on account of the rate of interest.
At per cent. the interest on $50 is $3.50
year, or 20 cents semi-annually. These are
even sums and easily accounted. The in
terest on $25 at per cent. would be rs cents
a year, or 371a cents semi-annually. Fifty
dollars is the lowest 3-per-cent. bond on
which the interest account could be easily
handled
In authorizing a popular loan Congress
should not fail to provide that the bonds
should be exempt from state and municipal
taxation. All the government bonds issued
during or since the civil war have contained
this provision, and it is important that the
new issue should. The interest at per
cent on $1,000 would be $50 year. If the
bonds are subject to state and municipal
taxation this interest would be reduced
from one-half to two-thirds in most of the
counties in Indiana. and. in some, would
be wiped out entirely. This would kill the
bonds as investment. To tax war bond
would be not only most unwise, but very
friotic