Evening star. [volume] (Washington, D.C.) 1854-1972, 1914-01-05

priations out of the Treasury of the
United States.
I'm the light of what has been said in
the discussion of the question, and The
conclusions reached, it might be assumed
that there was no occasion for any sepa-
rate reference to their resultant nScai
relations between the United States and
the District of Columbia, but the provi-
sion in the District bill of March 4, 1913.
which has precipitated this question. con-
templates not only that the appropriation
made shall be paid in accordance win
the acts of Congress in relation thereto,
but that it shall be SO accounted for.
opening the way apparently for the as
sumption that when paid in accordance
with the liabilities to the holders OF the
bonds there may yet remain an account
ing question as between the United states
and the District, to be determined on the
basis of Liabilities as between them as
distinguished from the liability 10 the
bondholderS.
In other words, it, though the United
States was liable to the bondholders,
that liability was, as between the
United States and the District, ana as
to the whole debt. merely the liability
of a guarantor. then. as between them,
the United States and the Dlstflct,
there would be no occasion for an &C
counting as to the half paid out OF the
Treasury of the United States. charge
United States, or. to put it otherwise,
IA credit of the whole amount paid for
interest and sinking fund on the whole
of the appropriation made by the United
States toward the expenses of the DIS
trict
Holds Distinction Is Plain.
Much that has been said already in
dicates the conclusion that must be
reached on this question and I feel sure
the application can be made without
the necessity of repetition.
I'm the conclusion above. numbered
4 l have used the word 'promisor' as
applicable to the United States in its
relation to the one-half of this liaDll-
ity to be paid out of its Treasury. If
the word is not technically correct in
the sense used it will at least serve
to diferepiate between the status of
the United States in its relation to that
half of the debt and its relation to the
other half characterized as that of a
guarantor. difference between one
who promises that he will do a thing
himself and one who undertakes that
another will do it.
As to ehalf of this debt the United
States undertook with the bondholders in
effect, that the District would pay it out
OF Its revenues from taxation, and TO
the other half, it promised the bondhold-
ers that it would appropriate it out of the
Treasury. The original pledging ella use
did not make certain these proportions
They might ultimately be seven-ei ghths
out of District revenues and >one-eighth
out OF the revenues of the United States.
So far as the bondholders were concern
ed, 1t was the pledge of the United States
TO provide the necessary revenues which
was effective and so far as they were
concerned an undertaking on the part of
the United States that it would provide
all the funds necessary out of District
revenues derived from taxation would
have been equally effective. In other
words. the United States, as guarantor in
terms, for the payment of all of this debt
would have been just as acceptable to the
bondholders as the United States as
suarantor of an unascertained part and
as promiserto-pa pay. of the other part
was to be as to all the debt either to
the bondhoders or as between it and the
District, why might it not as easily and
effectively have been SO stated?
Circumspection for Governments.
Great governments in the transaction
OF their business and in the fixing of
their liabilities must not be less circum-
spect than an Individual Because the
transaction involved governments fur
nished no good reason why the contract
should in terms purport one thing, to be
modified in paro or to be otherwise
construed on the motion of one of the
obligated parties.
THE United States undoubtedly as
sumed. SO far as the bondholders were
concerned, that it would pay one-half of
this debt. In entering into this contract
with the bondhoders. contract by
which it divided liabilities with the Dis
trict. it provided no condition upon its
liability, or indemnity or subrogaton in
its favor
In its direction to the District to
issue these bonds, it agreed that it would
contribute to their payment. In its after
determination of the amount of its con-
trIbutlon ri fixed it at one-half 1t did
this by legislation, of course, declarations
in public enactments by it duly consti-
tuted legislative authority, approved by
its chief executive. BY what process of
reasoning can it be said that these dec
larations published to the world as fixing
the status of the United States with
reference to these bonds meant one thing
to one party affected thereby. and with
out differentiation or condition therein,
All entirely different thing to another?
When the United States thus directed
THE issuance of these bonds and as
part of that direction took on itself
part of the obligation which it afterward
defined, as then contemplated that it
should do. it not only entered into an OBJ
legation to those who should become
holders of those bonds, but it. at the
same time. entered into a compact with
the District that it would pay a portion
thereof and afterward determined that
portion to be one-half. 1t cannot be ma
terial that its determination of the ques-
ton as to sinking fund came after, the
determinatio of the question as TO in
tereSt, neither can the obligation as
sumed be now held non-eXis tent be-
cause in the first instance the debt was
the debt of the District The competent
legislative power might define the obli-
cations of the United States to the Dis
trict as well as to others, might assume
Il part thereof to the District as Well as
to others, without consideration or rea-
son therefor, except. perchance a recog-
milton of its equitable obligation. and
when so assumed and declared by the
law they remain fixed so long. at least
as the law remains without amendment
and unrepealed.
Based on Existing Law.
Il do not assume to say anything
as tC the possible difference between
the relato of the United Stats to
the bondholders and the relations of