The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1904-12-13
SOUTHERN STATES IN DANGER.
Arbitration Campaign Only a Con-
spiracy to Compel Payment of
Confederate Bonds end Re-
adjusted State Debts.

| that the bonds which North Caro-
| lima readjusted in 1879. "can be used
| to great advantage by foreign gov
ernments," Oetter of Mr.. Simon
| Burke, M. c., from South Dakota
Volume 1872 U. S. Supreme Court Re-
ports, South Dakota VS.. North
Carolina.) and the recent Specula-
! tive suit against North Carolina by
South Dakota TO recover the principal
and twenty-five years interest of
bonds donated to South Dakota by
| Mr., Schafer and associates, gives sin
lister Significance to the attempts
made in 1897 and the present year to
| coerce the Senate into ratifying treat
les of arbitration With foreign gov
ernments.
The controlling motive of the arbi-
tration project from its inception has
| been TO annul or abrogate article XI
of the amendments TO the Constitu-
ton, and then, through an lntena-
tional court, compel the Southern
States and Michigan. to pay with in
terest the bonds which they read
iuSted" or reDudiated before and
after the Civil War. Minnesota may
also be involved as that State forced
fifty per cent readjustment Of its
bonds and coupons in 1881.
The arbitration campaign began in
IL
Southern States had completed their
reimbursement programme, and after
| it had become certain that the UnlleQ
States courts would not and couId
not set aside the Eleventh Amend
ment to the Constitution. 1t reached
it's climax when the Olney-Pauncefote
Treaty was sprung upon the country.
In the meantime large sums OF
money had been spent in trying 10
TO a sentiment the New Eng
land, Middle and Central Western
States. in favor of arbitrating all
differences with England. Ennis
saries of peace appealed in the name
of humanity for a treaty to prevent
war Financial assistance with mo-
raj support was offered to lrlsn-
! American societies III aid of Parnell
if they in return would favor arbitra-
ton.
The Senate and House of Repre-
sentatives that had rejected the
Chamberlain Treaties in 1883 and
1883 were induced to pass informal
resolutions favoring arbitration III
1890.
Three years later when a change
| Of administration had been effect "a
! in the United States the British Par
| lament discovered that the Senat $
perf,!nttCry action was an urgent Ia
via ;io!i that must be accented.
Secretaries of State, Gresham and
| Olney, in conjunction with Sir Julian
| Pauncefote, then began to construct
| treaty in which the Southern states
were to be enmeshed.
Prior to this the Venezuela CLAIMS
! Convention had been drafted py
! Secretary Bayard and withheld from
| publication for years. It's clauses en-
| bodied prpecedent for action against
the South 1t provided for the arol-
| tration of "all claims" against Vene-
! zuela, without regard to limits or
| time previous adjudication. or ma
| tional sovereignty. New York bank
ers presented under it as claims
! S3OO 900 Of Venezuelan bonds. issued
! in 1898, readjusted in 1857. and dis
missed by the Commission of 1S66-l0.
! The new Arbitration commissioners
decided by p vote of"two TO one that
Venezuela must pay the face value of
the bonds with five per cent yearly
interest from 1857 to 1890.
/ The Venezuela Convention marked
! a radical change in the policy of the
| United States government in relation
| TO owners of bends. Prior TO that
time, and therefore prior TO the re-
: adjusting action OF the southern
! States, the United States had denied
/ the right of governmental interVen-
ton on behalf Of it's citizens who
were shareholders in the securities or
| bonds of foreign governments. 1t
! Justly held that they had no prefer
, red claims over the other holders.
| Great Britain acted upon the same
! principle. The English umpire dis
missed the claims of our citizens who
held bonds of New Granada ana
| Mexico, and the United States Com
| missionars refused to entertain the
| claims of Holders of bonds of Florida
/ and the Republic of Texas.
The Olney- Pauncefote Treaty en-
phasized the change of policy by eX-
! pressly STIMULATING that financial
claims" in which "a State was con-
cerned, should be referred EN- masse
| to the semi-foreign tribunals created
| by the treaty and in event of dlsa-
! greement. be finally and irreVocably
| decided by the King of Sweden.
The exposure of these provisions
| killed the treaty and impressed its
promoters with the necessity of furth-
er concealing their real object.
! We now, therefore, have the Hague
! Convention for the arbitration OF the
| Interpretation of treaties and legal
/ questions whether already existing,
( or which may eventually ARISE. we
, also have Secretary Hays score OF
! proposed arbitration treaties with
| every European country, whose bank
| crs have boxes hlled with reddJusted
| or repudiated Southern States bonds,
readjusted Minnesota bonds, unpaid
bonds of Michigan. and the Republic
Of Texas repudiated Confederate
| bonds and doubtless MANY large rolls
| of Confederate oney.
| The ccnsunn4ate skill displayed IN
ooncealing Financial cldir"s agahlst
| States within the phrase legal ques-
tons already existing and the saga
| city evinced in avoiding national
| jealousy by inviting not only Eng
! land, but all Europe to participate in
/ the financial carnival, bear proof alike
| to the legal acumen employed, ano
| the vast amount of money expected
to be derived from the Southern
| States by the passage of these arbl-
| tration treaties
The validity of the readjusted and
repudated bonds is "a legal question
already existing Their collectibility
by foreign Governments is "a legal
| question which may eventually arise.
| Mr. Schafer not only wrote that
these bonds can be used to great ad-
vantage by foreign governments,
but further declared that the bond
| holders are inclined Ito make addi-
| tional donations to such governments
| as may be able to- collect from the
| reDudiating State.
IT is tn ha hone1 that sincere re-