The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1904-05-18
THE SOUTH DAKOTA ENTERING
WEDGE.

The people of North Carolina now
understand that the South Dakota
bond suit, the A. & n. c. r. r. receiv-
ership matter, and the recent demand
for repudiated bonds is all a part OF
a scheme from HIGHER UP to re-
open the 1879 settlement of the State
debt and grab the two railroads be-
| longing to North Carolina.
The South Dakota bond suit failed
provided the people send Legislature
here that will not take orders from
"HIGHER UP" Under the decision
of the Supreme Court, if it stands
South Dakota can sell only it's in
terest, subject to a mortgage not due
until 1919, in the value of ten shares
in the North Carolina Railroad Stock
That decision was based upon the idea
that those bonds belonged without
condition, to the State of South Da-
kota. 1t now seems that the fraud
upon the jurisdiction is exposed, for
the Bond Buyer, published in
New York, a high authority among
bond dealers, has an article on
"Repudiated Bonds of Southern
States" from which the following eX-
tract is taken:
But an individual owner of some
of North Cardinals bonds, Mr. SIMON
Schafer, who, we understand Is OF
the firm of Schafer q BrotherS, %
Wall Street, knowing that one SOW
ereign State could sue another' m
duced the Legislature of South Dakota
to pass law accepting from hiih ii
Gift of $4,000 of North CarolinaS re-
pudiated bonds on condition that II
would sue to recover with interest
and costs. reserve $4,000 of any judg-
ment collected for it's charity or poor
fund. and pay him any excess collected
over the face value of the repudiated
bonds The Circuit Court decided in
favor of the State of South, Dakota,
and this judgment the United States
Supreme Court has affirmed, fixing the
Judgment finally at $27, 400; ordering
any assets of North Carolina which
the United States Marshal can seize
to be sold from the east front steps
of the Capitol at Washington. Thus
South Dakota would get $4,000 and
Mr.. Schafer S17 400.
1T looks at first glance as though
Mr. Schafer had discovered gold
mine and thrown it open to all hold
ers of the $300000,000 of repudiated
bonds of the Southern States. But
there is no need to get unduly excited
at the South by fears or at the North
by hopes. States like South Dakota
which would undertake such suits are
not numerous; the Legislators of such
as are willing to accept such charity
are generally expensive to properly
corral and keep under tether; and few
of the defaulting States can, even now,
pay what they insist they do not owe
Special attention is directed to that
stated that when Schafer Brothers
presented $4,000 of North Carolina
bonds to the State of South Dakota
they did so with the express under
standing that $4,000 OF the Judgment
collected should be turned over to the
State OF South Dakota and the excess
thereof should be refunded to Schafer
Brothers, and in which it is also
stated that thus South Dakota would
get $4,000, and Mr.. Schafer $17,400
Court of the United States.
Once let the Legislature reopen the
settlement of the State debt made in
1879, and Pandora's box will be moth
ing to the ills that will be turned loose
upon North Carolina. The only proper
thing to do is to stand firmly by that
settlement, let the South Dakota folks
sell whatever they have got, and re-
fuse to make any compromise except
upon the terms in the act of 1879. To
show what a re-opening the 1879 set
Element means, it needs only to note
the aggregate of the debt now and
the aggregate in January 1879. In
January, 1879, State Treasurer John
nj. Worth reported the debt as fol-
lows:
Public Debt, Princf-
pal and Interest. $27, 120, 227.S5
Special Tax Bonds. II, 1856, 100000
Interest on same $1,000. 6,244,4fo.o0
Total .......... VA, foo,o9too
1t was entirely out of the question
for the State to pay that debt. In
deed, in the year previous to the act
of settlement, the Governor in his
to the Legislature stated that
the income from all sources did not
meet the necessary expenses. The debt
was therefore compromised and set
tied. The State debt today is as fol-
lows:
4 per cent. consolidated
bonds OBSERVATION-DISCLOSURES. SO, 40S,95O
a per cent prison debt bonds 10000
a per cent prison farm bonds 10000
4 per cent State debt bonds 100000
Total per cent bonds inter-
est bearing debt $3S7S950
Total per cent interest
bearing construction
bonds .......... 2,72O,OOO
Total present interest bear
ing debt ........ 6,59S,950
The old ftndable bonds not
yet presented will require,
if all are presented, 4 per
cent consolidated bonds. 210,52O
6 per cent old construction
bonds unredeemed 1900
Making a total debt interest
Il s,,xn n-f 1,.i,,