The Washington herald., 1914-01-06

who undertakes that another WIN do II.
AS to one-half Of this debt the United
States undertook with the bondholderx.
in effect that the District would pay It
out Of its revenues from taxation. and
as to the other half. II promised the
bondholders that II would appropriate IL
out of the Treasury. The original pledg-
ing clause did not make certain these
proportions They might ultimately be
seven-eighths out OF District revenues and
one-eighth out of the revenues OF the
United States. So far as the bondhoiders
were concerned. IT 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 II
would provide all the funds necessary out
OF District revenues derived from taxa
ton would have been eaqually 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 guarantor of an unas-
certained part and as a promiser- tor pay.
OF the other part IL then that was all
the United States was to be az to all the
debt, either to the bondholders~ or as be-
tween 1t and the District. why might
II not as easily and effectively have been
30 stated?
"Great governments In the transaction
of their business and In the fixing of their
liabilities must not be less circumspect
than an Individual Because the transac-
ton involved governments furnished no
good reason why the contract should in
terms purpose one thing. to be modified
In part or to be otherwise construed ON
the motion OF one Of the obligated parties
Agreement on Payment.
THE United States undoubtedly as
sumed, so far as the bondholders were
concerned. that 1t would pay one-half of
this debt In entering into this contract
with the bendholders, contract by
which it divided liabilities with the Dis
trict, IL provided no condition upon it's
liability. or Indemnity or subrogation In
Its favor.
In Its direction to the District to issue
these bonds. II agreed that II would
contribute to their payment In its after
determination Of the amount OF its con-
tribution 1t fixed II at one-half. II did
this by legislation. of course, declara-
tons In public enactments by its duly
constituted legislative authority, ap-
proved by its chief executive. BY what
process of reasoning can II be said that
these declarations published to the world
as fixing the Status Of the United States
with reference to these bonds meant one
without differentiation or condition there
in. an entirely different thing to an
other?
When the United States thus directed
the issuance of these bonds, and as
part Of that direction took on itself a
part of the obligation which 1t afterward
defined. as then contemplated that IL
should do. II not only entered into a
compact with the District that It would
pay portion thereof and afterward de-
termined that portion to be one-half. 1t
cannot be material that its determine
ton OF the question as to sinking fund
came after the determination Of the ques-
ton as to interest. neither can the obi
CATION assumed be now held as nom
existent because in the first instance the
debt was the debt Of the District. The
competent legislative power might define
the obligations of the United States to
the District as well as to others. might
assume a part thereof to the District as
well as to others. without consideration
or reason thereof. except. perchance. a
recognition 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 amend
ment and unrepealed.
Conclusion of Opinion.
Il do not assume to say anything
as to the possible difference between
the relations of the United states TO
the bondholders and the relations of
the United States to the District, in
connection with any possible question
Of the right of modification by subse
quent legislation. My province is to
treat them as / find them under eN-
listing laws in so far as they are in
volved in this question arising under
this provision in the District bill for
the current year. With the status of
fiscal relations between the United
States and the District, outside of this
question, / have no proper concern.
except to say that the determination
of this question is only conclusive OF
matters within its own proper scope.
Il have. therefore. to advise you that
under the act making appropriations
to provide for the expenses of the gov
eminent of the District of Columbia
for the fiscal year ending June 80, |
1914, and for other purposes (37 Stat. |
93S), payment to be made during said
year of interest on and sinking fund |
for the payment OF the funded debt in |
question, should be made. within the |
limits of the amount appropriated for |
said purpose. with moneys withdrawn |
from the Treasury of the United States |
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