Year: 1868

monish the lender that it is not well to be
over anxious in exacting from the borrow
er rigid compliance with the letter OF the
bond. ,s s. ss


IF provisions be made for the payment
of the indebtedness Of the Government
in the manner suggested, our nation will
rapidly recover its wonted prosperity. Its
interests REQUIRE that some measure
should be taken to release the large
amount of capital invested in the securi-
ties of the Government; it Is not now mere
ly unproductive, but in taxation annually
consumes $150,000, ,000, which would other
wise be used by our enterprising people
in adding to the wealth OF the nation.


Our commerce, which, at one time sue
cessfully rivalled that of the great mari
time powers, has rapidly diminished and
our industrial interests are in depressed
and languishing condition. The develop
ment OF our inexhaustible resources is
checked, and the fertile fields of the South
are becoming waste, FOR wantof means to
till them. With the release of capital,
new life would be infused into the paralyzed
energies of our people, and activity and
vigor impaired to every branch ofindustry.
Cur people need encouragement in their
efforts to recover from the effects of the
rebellion and of iniudicious legislation,
and it should be the aim of the Govern
ment to stimulate them, by the prospect OF
an early release from the burdens which
| impede prosperity. If we cannot take the
1 burdens from their shoulders, we should
at least manifest willingness to help to
bear them. g. fr..s 80


| II referring to the condition of the cir
crllating medium, shall merely reiterate
substantially that portion of my last an
nual message which relates to that sub
! iect.


The proportion which the currency of
any country should bear to the whole value
| of the annual produce circulated by its
means is question upon which political
| economists have not agreed, nor can it be
controlled by legislation, but must be left
| to the irrevocable laws which everywhere
regulate commerce and trade The circu-
| lating medium will ever irresistibly flow
to those points where it is in greatest de-
mand,


The Law of demand and supply is as un-
erring as that which regulates the tide of
the ocean and, indeed, currency, like the
tides, has its ebbs and flows throughout
the commercial world. At the beginning
| of the rebellion the bank note circulation
of the country amounted to not much
more than two hundred millions of dollars.
| Now the circulation Of National Bank
notes, and those known as legal tenders,
is nearly seven hundred millions. While
| it is urged by some that this amount should
be increased, others contend that decided
reduction Is absolutely essential to the best
interests of the country. In view of these
diverse opinions, it may be well to ascer-
tain the real value of our paper issues,
when compared with metallic or CONVEX
tible currency. For this purpose let us
| inquire how much gold and silver could
be purchased by the seven hundred mil
lions of paper money now in circulation.
/ Probably not more than half the amount of
the latter; showing that when our paper
currency is compared with gold and silver
! its commercial value is compressed into
three hundred and fifty millions This
striking fact makes it the obvious duty of
the Government, as early as may be con-
sistent with the principles of sound politi-
cal economy, to take such measures as
will enable the holdefs of it5 notes and
those of the National Banks to convert
them, without loss, into specie or its equiv
alent. A reduction of our paper circulat-
ing medium need not necessarily follow.
This, however, would depend upon the
law of demand and supply, though it
should be borne in mind that by MAX
ing legal tender and bank notes con-
vertible into coin, or its equivalent,
their present specie value in the
hands of their holders would be en-
hanced one hundred ger cent Legisla-
ton for the accom- plishment of result so
desirable is demanded by the highest pub
lie considerations. The Constitution con-
templates that the circulating medium of
the country should be uniform in quality
and value. At the time of the formation
of that instrument the country had just
emerged from the war of the Revolution,
and was suffering from the effects of q
superabundant and worthless paper cur
rency. The sages of that period were
anxious to protect their posterity from
the evil which they themselves had ex-
perienced; hence, in providing a circu-
lating medium, they conferred upon Con-
gress the power to coin money and regu-
late the value thereof, at the same time
prohibiting the States from making any
thing but gold and silver tender in pay
ment of debts.


The anomalous condition OF our
currency is in striking contrast with that
which was originally designed. Our cir
culation now embraces-frst, notes of the
National Banks, which are made receiva-
BILE for all dues to the Government, ex.
Guiding imposts, and by all its creditors,
excepting in payment of interests upon Its
bonds and the securities themselves; sec
ond, legal-tender notes issued by the
United States, and which the law requires
shall be received as well in payment of all
debts between citizens as of all Govern
ment &ues, excepting imposts; and, third
gold and silver coin. By the operation OF
our present system of finance, however,
the metallic currency, when collected, is
reserved only for one class of Government
creditors, who, holding its bonds, semi-an-
nually receive their interests in coin from
the national treasury. There is no reason,
which will be accepted as satisfactory by
the people, why those who defend us on
the land and protect us on the seas; the
pensioner upon the gratitude of the ma
ton, bearing the scars and wounds re-
ceived while in its service the public SER
wants in the various departments of the
Government; the farmer who supplies
the soldiers of the army and the sailors
of the navy; the artisan who tolls in the
nations workshops; or the mechanics and
laborers who build it's edifiees and con-
struct its forts and vessels of war, should
in payment of their just and hard-earned
dues, receive deprecated paper; while an
other class of their countrymen, no more
deserving, are paid in gold and silver.
Equal and exact Justice requires that
all the creditors of the Government
should be paid in a currency pos.
sessing uniform value. This can only
he aponr, ,,1lishad bu tho restoration nf the