Year: 1867

''Mr. McCulloch, an honest fnancier,
conservative as almost becomes ne
cessity to banker, and therefore safe to
keep things as they are, will do any
thing to change them save in one con-
dition. Naturally, he possesses the idea
that gold should regulate all values,
unmindful of the fact that gold has
been measure of value only (and it
now ceases to be that), has become as
far as this country is concerned an ar
ticle of merchandise merely. Mr.. Nc
Culloch's fixed idea seems to he that n
return to specie payment would be a
panacea for all financial troubles. In
order to do this he has recommended to
Congress that provision be made for
| the payment of the interest of our bonds
in gold in Europe, SO that they may sell
more readily. Now, as the bonds sell
for thirty per cent. discount in gold,
and if we RETURN to specie payments
they would be worth one hundred cents
in gold, Mr.. McCulloch has failed to tell
US how many we have got to sell at
seventy cents on the dollar to be able to
pay them at hundred


OUR BONDS.


There are six hundred millions, more
or less, of our national bonds in Europe,
bought at rates from forty to seventy
cents on the dollar. To say nothing of
the effect of return to specie payment
on our own bonds, the first effect of snch
return would be to put some two hun
dred millions of dOliSrs into the pockets
of the bankers of Europe, which must
he paid from the taxation of the pro-
ducts of labor in this country, which is
the only source of revenues in fact.
There might probably be some call upon
us in equity TO do this if these bonds
had been taken by the European bank
ers TO aid us with money for our great
struggle; but it is notorious that they
took not one dollar of our bonds until
our success in the war was assur. d.
During the war we had to take all our
own loans, and they bought them at
the usurious discount of thirty to forty
cents as a matter OF investment; so that
we are not called upon by any equitable
considerations to pay dollar more than
the bends compel us. The same is true
in regard to the five.twenties held by
our own capitalists. The argument used
why we should pay them in gold is that
our capitalists and bankers took them,
when the country was engaged in war,
as an act of patriotism; but with gold at
200, and from that up to $50, one can
not forget that they had an eye to the
proceeds as well, in this, that they saved
from so to 60 per cent. Now, why should
the country be called upon to disarrange
its business relations, to reduce its val |
ues, to burden its people with taxation,
in order to pay from the poor mans Ia
Dor into the capitalists pocket this |
immense premium-while, too, this |
investment escapes taxation, which is |
TINS wholly thrown upon productive
Industry 1t would seem to be wisdom
in the first place to have all national Sc
curities taxed. and while one should
recognize the fact that during the war
the country might raise money on any
terms, and that these terms, whatever
they were, should be faithfully kept
yet, now that peace had returned, with
it come return to financial policy
which shall raise the money to pay off
these untaXed obligations at the earli-
est possible moment, and substitute for
them securities liable to taxation.
"Now, the 500 bonds become payable
at the option Of the United States in
five years after the issue. There are
six hundred millions becoming payable
at the option of the United States in
five years after the issue. There are
six hundred millions becoming paya-
BILE in the present year. Again, they
are not, by their terms, payable in
gold. On the face the interest is
declared to be payable i'll gold, and
and the very fact that the interest
is stated to be so payable excludes
the idea that it is so. The exact letter
of the bond (and l think you will agree
with Inc that the Government creditors
of such n shave are entitled to no more)
requires the bonds to be paid in such
money as other creditors are paid with
by the United States. The popular
idea is that the 5-20s are payable in
gold, but that arises from the fact that
Mr.. Chase, while Secretary of the Treas
ury, upon the first Issue in 1862, had a
letter addressed to him by some bank
ers, as TO whether these bonds would be
paid in gold, and he replied, what was
true at that time, that all the Obliga-
tions of the Uaited States had been paid
in gold, andit was proper TO presume
that they would be SO paid in future.
And upon the strength of that letter the
bonds were deemed gold-payable, as
well as gold-bearing, although it was
in exact opposition 10 the words OF the
contract"