The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1918-11-04
ATLEAGUE
PLAN HAS DONE,
WHERE APPLIED
States Bankrupted by Essays at
Political Control of
Private Business.
INVESTORS LOST ALWAYS
What Happened in Minnesota
When Debt Limit Was
Boosted to Skies.
INVESTORS LOST ALWAYS

Fargo n. d., Nov. An connec-
tion with the constitutional amend.
ments to be voted OH next Tuesday
with reference to unlisted bonding Of
the state and guaranteeing of bonds
facts gathered from Prof. Scott's Re
pudiation of State Debts" will be of
interest to the voters Of North Da-
kOta. 49,, t.ss5a
Ten States Experimental.
The following ten states and also
period between 1912 and 1870 did the
very things that the proposed amend
ments want North Dakota to do. They
became liable upon bonds in aid Of
private business corporations and con-
Germs. Virginia, North arolina, South
Carolina, Georgia, Florida, Alabama.
Mississippi, Louisiana, Arkansas and
Tennessee.
These states were,in 1870, liable on
bonds in aid of business enterprises
in the aggregate sum OF over $685.
100000
Undertaking Failed.
Most of these undertakings failed,
or We're partly or wholly unsuccess-
full. !, The business in support Of which
these bonds were issued was repre-
sented by railroading, building Of
plank roads with toll privileges, canal
construction. navigation companies,
the state of Florida having become IL
able on bonds in the sum Of $4,000 in
aid of the Crocodile Navigation COM
pany, etc.
As a result Of this experiment in
private business, the states were
,baakrupted. They tge.tld not. meet the
obligation Of these bonds. The tax
payers groaned under insufferable tax
burdens. The development Of the
states was checked and retarded.
Their credit was ruined and their hon
or compromised.
" ~: Investors Lost. -
There were lost to small investors,
as well as large, millions"of dollars
invested in these bonds. .9st
tNbte the effect, on the credit Of the
state The value Of the seeurities
the state of Arkansas, during this
period fell at times as low as 7 cents
on the dollar. The average value Of
its bonds and securities from 1872
to 1879 was 10 cents on the dollar!
The average value for North Carolina
for the same period was 25 cents on
the dollar. Imagine bond of a state
for 500, selling at only S25 or s19.
Yet such is the result Of unlimited
state bonding and guaranteeing OF
bonds.
During this same period the bonds
Of little Rhode Island sold on tn eaver-
ave of $1.O4 on the dollar. Why? Be-
cause this state was son a sound fl
nancial basis and did not permit the
issuing of unlimited bonds, nor the
guaranteeing of bonds. For the same
period Connecticut was $1.O4; Massa-
chusetts was $1.O3; New ork $l.1O;
Maryland $1.O2 and so for the
states that were on sound basis:
Every state that experimental with
bonds for private business burned her
fingers and had the sad and shameful
experience above related.
voters of North Dakota should learn
from the experience Of other states.
Minnesota's Experiment.
The proposed amendments remove
all debt limits. This is admitted by
Mr.. Twnley and the state admin1stra'
tion. The purpose is to enable North
Dakota to 60 into any or all busi'
ness as deep as spectators may wish.
Listen to the experience of Minneso-
ia when the lid was removed from the
debt limit. The original constitution
Of Minnesota had a debt limit OF
$3.50, 900. North Dakota now has a
limit of $2O0,0OO On April Is. 1858,
v CONTINUED on Page Four.>