The Vermont watchman. [volume] (Montpelier, Vt.) 1883-1911, 1902-01-29
PAYING OFF THE DEBT.

A good deal of debt paying by the
government is under way, unknown
to the country. The treasury had a
large surplus throughout 1901, but it
was kept down by the process of buy
ing interest bearing bonds and cancel
ing them, thus extinguishing a CORE
spending amount of debt. The gov
ernment's income exceeded its ordi-
nary outgo in the calendar year 1901
to the extent of about 800, 600, 600.
To store this big sum of extra cash
in the treasury i'll such period of
business activity would send the rates
for money up to eXorbitant figures
and be a serious menace to trade.
Secretary Gage avoided this peril by
paying out large sums for bonds not
yet due, thus reducing the govern
ment's obligations.
From the beginning of April, 1901,
to the end of December theYpar value
of the bonds bought by Secretary Gage
was in round figures, 800, 600, 600, and
to purchase these he had to pay
out $72, 600, 600 on account of the
big premium at present on bonds.
The debt was thus cut down $780, 600,
600, and the surplus was reduced S72,
900, 600. a monetary stringency was
averted in this way, and at the same
time the peoples debt burdens were
reduced. The amout of the cash in
the treasury is kept at figure which
makes the government master of the
to meet all sorts of demands which
can be made upon it at any time
while an abundance of money is left
III trade channels to meet the necessi-
ties of an active and constantly in
creasing business all over the country.
Naturally the cash i'll the hands of the
people has increased to a large extent
i'll the past few years. The mints are
busy and i'll most years the country
gets from the outside world more gold
than it gives up. The circulation on
March /, 1897, three days before the
Republican party entered power, was
81, 675, 694, 953, and this sum was ex-
banded to 81, 250. 256, 260 at the begin
ming of December, 1901. This in
crease was far faster than had been
the growth i'll population. The per
capital circulation at the earlier date
was 1923. IA, while it was 1928. 10 at the
latter time, six weeks ago. OF course
the circulation is even greater than
this now, for the treasury disburse-
ments and the activity of the mints
amount to several times the loss of
money which has been occasioned by
the recent gold expectation
This is a condition on which the
country can felicitate itself. At the
same time the steady increase of the
governments income over its outgo is
an unnatural condition, which Con-
gress would do we'll to end as soon as
possible. Both the President and the
secretary of the treasury have called
the attention of Congress to the neces-
sity for the reduction of the revenues.
Secretary Gage has shown the reasons
for this in an effective way. Repre-
sentative Bartholdt has introduced a
bill for the abolition of the remainder
of the war revenue act of 1898, which
is meeting the favor of the Republi-
can leaders in the House and which is
championed by many prominent news
papers, Republican and Democrat
Bond buying is one way to keep down
the treasury surplus, but wiser
course would be to keep down the sur
plus by reducing taxation