Year: 1869

reducing the interest en- he bonds, is q
mere collateral privilege, and in no wise
affects the right of the holder of the note
to demand the performance of the origi
nal contract printed on its face. When
the Government therefore refuses to per
form the original contract, and throws
the holder entirely upon his collateral
privilege Of funding the notes into bonds,
the act forms the clearest possible defn
ition of reputation, and does not differ
in principle from the proposition Of the
President to apply the payment of the
interest to the extinguishment of the
bonded debt When the greenbacks have
been brought to par, and the Govern
ment stands ready to redeem them. then
and not till then, can their legal tender
character be taken away without repudi-
alton. -


Suppose that Congress should pass a
bill providing that when the Five-twenty
oonds are due the holders may fund
them into three per cent. bond, and
that if they are refused to exchange, the
Government will make no provision for
their payment The Secretary would
call that reputation, and yet the case is
different in no respect from what he pro
poses The greenback note promises to
pay so many dollars on demand. The
bond promises to pay 80 many dollars at
particular time. The greenhack note
declares that it is ga legal tender for all
iebts, public and private, except duties
on imports and interest on The public
debit" which gives it oret third its cur
rent value The bond promises to pay
six per cent. in gold, which is its chief
element Of value. The greenback prom
ises to pay to the bearer, and SO does
the bond. The title to each of them
passes by mere delivery, and there is no
more personality about the one than a
bout the other The moral and legal
obligations of the one promise are
precisely equal to those of the other and
Congress has as much right to strike out
the interest on the bond as to strike out
the legal tender clause on the notes.
The value Of the greenback note may be
so DEPRECATED as to make it the inter
est of the holder to fund it into a bond
bearing the very lowest rate Of in terest,
or no interest at all, and Congress might
by Legislation SO impair the value of
the five twenty bonds as to make it the
interest of the holder to exchange it for
bond drawing interest only at the
rate of two per cent. The Secretary
proposes to take from the greenback
currency one third of its current value
by striking from it, its legal tender
character, and then authorizing the hol-
der to fund it into bond drawing low
rate of interest at the same time telling
him in substance, that this is final
measure, and that, if he does not fund,
he will get nothing.


But it is true that by stripping the
currency of its legal tender character,
the country will at once be brought to
specie payment that is to say, there
will then be no lawful money but gold
and silver, which would be legal ten
der in payment of debts, and every man
would be required to pay coin on his
contracts. But the Secretary could not
afford to strike down the value of the
currency in this way without suggesting
some provisions for it, and so, notwith-
standing the fact that he had just said
that the policy of contaction had been
emphatically condemed by Congress,
and it is now too late to return to it, he
says the law stripping the notes of their
legal tender character should be also
provided for fu d n til m into
bonds at the pleasure of the holder,
bering such rate of interest as may be
authorized by Congress on the debt into
which the present outstanding bonds
may be bonded. 1t may we'll be imagi-
ned that the holder of the notes will
then be ready to fund them in any sort
of bond. But what is that but contrac-
ton, pure and simple?


The Secretary's policy travels in a
circle, which invariably brings him back
to contraction He proposes nothing
for redemption, and offers only that pol
icy which he says has been emphatically
condemned by Congress, and as emphatic
ally by the country. Contraction is the
.sSengrado policy" of bleeding the coun-
try nearly to death to cure it of = dis


.ase which demands tonics and building
up. The withdrawal of even 10000,
900 of the circulation would produce
great stringency in the money market,
innumerable bankruptcies, and most
likely result in panic and crash, from
which the country would not recover
for years, and dtlring which the power
of the Government to fund the debt and
redeem the balance Of the greenback
currency would be paralyzed. To con
tract the currency to the extent of fund
ing all the greenbacks would be financial
suicide-wouid precipitate disaster to
the trade, industry and prosperity of the
country, for which there is no example
in history. We must not return to spe-
Gle payment in that way. We must de-
scend the mountain by easy slopes and
gentle curves, though it may take much
longer, rather than spring from the top
of the precipice, to be dashed in pieces
at the bottom.


But it is broadly intimated by the
Secretary that the Supreme Court will
decide the laws making the greenback a
legal tender in payment of debts to be
unconstitutional, and therefore void. If
the deed is to be done let it be by the
court, and not by Congress-. But it
would have to be very clear case that
would justify the court in making de-
cision fraught with such terrible calam-
tiles to the country. If there be doubts
hanging about the question they should