The Farmington times and herald. (Farmington, St. Francois Co., Mo.) 1902-1905, 1902-08-28
FALsEHooD OF REPUBLICANS.
oHs Of the Grsas nlastntsHasntaa Of the
"GrRRa OIa Party's- CAM
pRikn TrAt-Boek.

The republicans In official and uB.
official documents and everywhere.
In fact, have bren boasting at the
very high prices at which our two
per cent. bonds sell. or, in other
words, az the very low rate of In
terest at which this government can
borrow money az compared with
other nations. Thus, In their cam
palgn textbook, the republicans ssyi
Uncle Sam II the only one on earth
who can borrow money az two per
cent, and the bonds be at a premium
at that"
A half truth l. always the mcanest
kind Of a lie. because u Is dificult
10 disprove. IL IL not only unfair to
compare our bonds with the bonds of
most other nations, but II is abso-
iutrly false to state that Uncle Sam
can borrow money at two per cent.
and have the bonds sell at y pre-
MUM.
1. The bonds Of Great Britain, and
uf some other European countries,
are subject tu income and perhaps
are exempt from any aud all kinds
nf taxation.
g A direct comparison between
the price ~ our two per cent. bonds
and the government bonds Of Great
Britain and France ~ unfair because
the price of our bonds ia unduly en-
HANGED by the artihcial demand ere
atcd by our federal banking laws,
which require national banks to
own these bonds and deposit them
with the United States treasurer.
This enhances the price Of all our
bonds.
D. hut In the case 81 our two per
cents. there iE further artificial
stimulus or special privilege IN tho
provision that the tax ON national
bank notes secured by thsss bonds
shall be unr-half of one per cent.
less than the tax on notes secured
hy all other classes Of bonds. This
makes these bonds. for purposes OF
national banks. practically 2h per
cent. bonds as compared with all
the other issues. The government
pays only two per cent. urtright,
but, ao far az the bonds are held
as the basis Of bank currency land
most ~ them are M heidi u pays
another half per cent. In remission
uf taxation on the bank currency.
This explains why the two per cent.
bonds sell so much higher in pro.
portion than the three. four or five
per cent. bonds. The four per cent.
bonds Of 1925 now sell for about 1913.
and the twua for about los. This ~
ON the basis ~ about 2.i5 per cent.
interest for fours and i.75 for the
twos. n. however. the No called tyvOB
are considered rs 2H per cent.
bonds, as may be properly done, they
will be found tn be selling on tho
basis of about a,i2 per cent interest.
Virtually. then, the United states
pays Indirectly a premium un bonds
of onc-half of one per cent. "a tho
holders of two per cent. bonds. II
Il would raise this premium to ~
per cent. II could borrow money
without interest. ~ II would make
the premium R,c per cent. Il could
receive Interest IN iis own debts.
and IT. creditors would he bidding
against each other for the privilege
Of owing Uncle sam money just as
walters In restaurants. where tips
are numerous and large, pay the pro-
prictor for the privilege Of serving
his guests.
All Of our government bonds en-
JOY special privileges, and our two
per cents are more favored than the
others, II all privileges were taken
away from our bonds, they would
probably sell 30 as 60 yield II net
Income nf about 2.e5 per cent. That
iE. the government could issue "a
per cent. bonds and sell them at par.
II cannot. then, borrow money at
two per cent. an ordinary bonds and
sell them at par, and the statement
In the campaign book Is false.
BYRON W. HOLT.