Evening star., 1935-02-20
A Matter of Conscience.

A Matter of Conscience.
News that the New Deal wins VIC
tory" in the gold cases has naturally
served to overshadow other points in
volved in the historic decisions of the
court on Monday. But the closer one
reads the decision of the court on the
gold clause in Government bonds the
stronger the conclusion becomes that
the battle over this particular issue
has not been finally won or lost, but
has in effect been shifted from courts
and Congress to the tribunal of national
conscience. The opinion of the court re-
garding reputation of a Government
obligation was not the opinion of five
against four Of the justices. It was
unanimous. And while the lawyers IN
Congress and the Department Of JUS
tice are casting about for possible
steps which might be taken to relieve
the Government definitely and finally
from the expense of meeting the obli-
CATION under the gold clause, the words
of the court regarding the sanctity of
this and other obligations assume
greater significance.
One of the arguments of the Gov
ernment in attempting to justify the
joint resolution of Congress repudiat-
ing the gold clause was that earlier
Congresses could not validly restrict
the Seventy-third Congress from ex-
ercising its powers to regulate the
value of money, borrow money or reg
ulate foreign and interstate COM
merce." And from this premise, said
the court, "the Government seems 20
deduct the proposition" that when the
Government borrows money and
pledges the credit of the United States
it is free to ignore that pledge and
alter the terms of its obligations "in
case later Congress finds their full
fillment inconvenient."
The courts reply to that argument Gas
delivered by Mr.. Chief Justice Hughes)
may, in time, assume even greater
Importance than is now attached to it.:
On that reasoning, if the
terms of the Government bond as
to the standard of payment can be
repudiated, it inevitably follows that
the obligations as to the amount to
be paid may also be repudiated. The
contention necessarily imports that
the Congress can disregard the obliga-
tions of the Government at its dis
cretion and that, when the Govern
ment borrows money, the credit of
the United States is an illusory
pledge.
We do not so read the Constitution.
There is a clear distinction between
the power of Congress to control or
interdict the contracts of private
parties when they interfere with the
exercise of its constitutional authority,
and the power of Congress to alter or
repudiate the substance of its own
engagements when it has borrowed
money under the authority which the
Constitution confers.
BY virtue of the power to
borrow money ION the credit of the
United States" the Congress is au-
thorized to pledge that credit as an
assurance of payment as stipulated
as the highest assurance the Govern
ment can give, its plighted faith.
To say that the Congress may with
draw or ignore that pledge is to as
sumo that the Constitution contem-
plates vain promise, a pledge hav-
ing no other sanction than the pleas
ure and convenience of the pledger
This court has given no sanction to
such a conception of the obligations
Of our Government.
No doubt there was in March, 1888,
great need of economy. But
Congress was without power to reduce
expenditures by abrogating contrac-
tual obligations of the United States.
To abrogate contracts, in the attempt
to lessen Government expenditure,
would not be the practice of economy
but an act of repudiation.
The argument in favor of the Joint
resolution, as applied to Government
bonds, is in substance that the Gov
ernment cannot by contract restrict
the exercise of sovereign power. But
the right to make binding obligations
Is competence attached to sovereign
ty. The Constitution gives to
Congress the power to borrow money
on the credit of the United States,
an unqualified power, a power vital to
the Government, upon which in an
extremity its very life may depend.
The binding quality of the promise of
the United States is of the essence of
the credit which is so pledged.
While the Congress is under
no duty to provide remedies through
the courts, the c0ntractual obligation
still exists and, despite infirmities of
procedure, remains binding upon the
conscience of the sovereign.
The still, small voice of conscience
may not make itself heard above the
roars of Government Wins Gold
Case"-but, nevertheless, it is there.