New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1907-08-25
NEW YORK Is A
WASTEFUL BORROWER
PAYS INTEREST RATHER
THAN COLLECT TAXES.
This Has Cost Nearly Seventy
Millions That Might Haze
Been SGOed.

If a merchant conducting a large business had
customers who owed him a lot of money and de-
clfned 10 press them for payment, but instead
went 10 the banks and borrowed at high rate
of interest the money necessary 10 run his own
business what would be thought of him. He
might he regarded as good fellow by the
customers. but most persons would call him g.
'chump." and some might use much more IN
complimentary language
Yet isn't Father knickerbocker much in the
position Of this extrava gantly lenient merchant?
Last year II cost him the enormous sum OF
s. 500 453 in interest to borrow enough money
with which TO administer the city government
This year 1t will cost him about 100000 more.
And this IS simply because he is so easy in
the matter of collecting tax moneys due him.
There are two ways in which individual or
q city can contract debts. a with family
wants TO make provision for his children. for in
stance He invests in a life insurance policy.
buys lot and builds a house. AS the years go
by he meets the premiums upon his insurance
policy until it is paid up. He pays off the mort
gage on his house and gradually emerges from
debt. He has incurred liabilities in order TO &C
quire for himself and his children tangible nee
essary assets
The city which follows this plan borrows
money with which TO establish great public
vices, to build parks and schoolhouses, and TO
create permanent facilities for its population in
many different ways Suppose the city of New
York decides 10 build a new schoolbouse at
cost of SSo0.0o0 for the land and building In
stead Of paying cash. bond is issued for the
100000 and the money is obtained by selling
This bond is payable in forty years. per-
haps, and bears interest at i per cent q year
This means that when it is finally paid off it
has cost the city S4S0,000 TO borrow the original
S;st6el0 needed for the new SChoOhouse. Great
as the cost of this method is. it can be defended
on the ground that the schoolhouse is a neces-
sary and tangible asset for the use of pres
and f11r7,r adequate
sinking fund is created, and yearly contributions
maGe 10 that fund from revenue, the whole debt
can be paid of, principal and interest. through
these contributions spread over the entire
a WASTEFUL WAY.
But there is the other way in which an in
diridual or a city can contract debts. If a man
has crecit he can borrow money with which TO
buy clothes. dine his friends. and pay for
similar neoessaries and luxures He also
pay his butcher, baker and grocer in prornissOry
notes, and thus increase his Indebtedness
The city which proceeds on this plan issues
bonds for cleaning it's streets. for paying the
salaries Of officials. for the maintenance of its
schools, for repairs TO public buildings, and
for the innumerable other current expenses
OF the municipality Apply this instance. apd
suppose il is necessary tc repair the City Hall
What is done? Does the great and wealthy city
Of New York put its hand IN its pocket so TO
speak and hand out the paltTy sum required
for the work? No. that is not the way IN
which dOEe all Nothing so simple as
that for Father knickerbocker! Bonds are
issued for 81. zS5, the amount Of the bill This
bond is payable in a years time, and bears in
1erest al 1 per cent.
When the city needs a small amount Of fire
hose 10 replace some that has rotred. il does
not pay cash fOr it Some was needed a few
months ago, and bonds We're Issued for the cost
-S7.762. with interest al Der cent
Two automobiles were bought in March for
the use CT the city officials In order 10 pay
for them bonds had to be sold for $500. bear
sng interest at ( per cent
In previous years this thing has been
done. and here are some choice specimens OF
what these bonds were issued for
For payment of expenses incurred on the oc-
casior Of a visit to the city of New York of
representatives OF the French Republic, bonds
for s. 800 with interest at ) per cent
For the purchase Of rolltop desks for the Of
fee Of the Register bonds for $500, with interest
per cent
For the purpose OF celebrating by appropriate
ceremonies the uShering in OF the twentieth
century, bonds for $500, with interest at , per
cent
For the payment Of expenses OF drapng the
City Hall and the Borough Hail. Brooklyn. while
participating in the funeral honor Of President
Mckinley. bonds for $500 with interest at B
cent