Year: 1868

The following is the annual report


of the Secretary of the Treasury:


TREASURY DEPARTMENT, Dec. !, 1865.


"In. compliance with the require


ments of law, the Secretary of the


Treasury has the honor to make to


Congress the following report:


SIN his former communications the


Secretary has expressed so fully the


views upon the only great subjects of
the currency, the revenue and the
public debt, that it may be quite un-
necessary for him again-to press them
upon the attention of Congress. These
subjects, however, have lost nothing
of their importance.


1.-THE public mind during the past
year has been turned to their eonsid-
Grafton with more absorbing interest
than that of any former report.


''The Secretary will, therefore, he
trusts, be pardoned for repeating some
of the views heretofore presented by
him.. If there is any question in fl
nance or political economy which can
be pronounced settled by argument
and trial, it is that inconvertible and
deprecated paper money is injurious
to public and private interests, pos
tive political and financial evil, for
which there can be but one justifica-
ton or excuse, viz; a temporary ne
cessity arising from an unexpected
and pressing emergency; and it fol-
lows, consequently, that such circu-
lation should only be permitted until,
without a financial shock, it can be
withdrawn or made convertible into
specie. If an irredeemable bank note
circulation is an evidence of bankrupt
or badly managed banking institu-
tions, which should be deprived of
their franchises or compelled to hus-
band and make available their re-
sources, in order that they may be pre-
pared at the earliest day practicable to
take up their dishOnored obligations,
why should not an irredeemable gov
eminent currency be regarded as an
evidence of bad management of the
national finances, if not of national
bankruptcy ? and why should not
such wise and equal revenue laws be
enacted and such economy in the use
of public moneys be enforced as will
enable the Government either judici-
Ously to fund or promptly to redeem
its broken promises?


''The United States notes, although
declared by law TO be lawful money,
are, nevertheless, q dishOnored and
disreputable currency. The fact that
they are legal tender, possessing such
attributes of money as the statute can
give them, adds nothing to their rela.
tive value, but makes them all the
more dishonOrable 10 the heGOvernment,
and subversive of good morals. The
people are compelled to take, as mon
ey, that which is not money, and are
becoming demOralized by its constant
ly changed value They are in danger
of losing that sense of honor in their
dealing with the Government and
with each other, which is necessary
for the well being of society. 1t is
vain to expect, on the part of the peo-
pie, a faithful fulfillment of their
duties to the Government as long as
the Government is faithless to its OBJ |
legations nor will those who do not
hesitate to defraud the public revenue,
long continue TO be scrupulous in their |
private business. Justifiable and nee
essary as the measure was then regard
ed, it is now apparent that an unfOr- |
tunate step was taken when irredeepl- |
able paper was issued as lawful
and especially when they W
a valid legal tender in ps


debts contracted when the ~


legal as the commercial st S lTeeted to


value.


The legal tender notes enable debt !
ors to pay debts in a currency largely |
inferior to that which was alone reqog- |
nized as money at the time they were |
incurred, and the validity of contracts
is thereby virtually impaired. If all |
creditors had been compelled by law |
to pay into the public Treasury fifty
per cent. or ten per cent, or indeed |
any portion of the amounts received
by them from their debtors, such a |
law would have been condemned as
unequal and unjust, and yet the result
would have been to lessen the extent
of receipts from this sOurce.-the ne
cessity for other kinds of taxation, and
thus to relieve in some measure the
class unjustly, because unequally, |
taxed by the legal tender act. A por-
ton of the property Of one class of cit
izens was virtually confiscated for the
benefit of another, without an increase
thereby of the public revenues, conse-
quently without any compensation to
the injured class. There can be no
doubt that they are chargeable, in no
small degree, with the decentralization
which has generally prevailed. The
objection to these notes as lawful mon |
eys was stated at length in the previ-
Gus report of the Secretary, and may
thus briefly be re-stated. They in
creased immensely during the last of
the war, and they have added largely
to the expenses of the Government |
since the restoration of peace; they
have caused instability in prices, un-
steadiness in trade, and put check |