Year: 1874




Government will have an excess OF receipts
over expenditures of about twenty million
dollars to dispose of. Honor and exDediency,
| the laws and the constitution, all command that
this surplus be used in retiring the Overissue
of twenty-six millions in the legal-tender cir
culaiion. The only thing the President can
do in this emergency, without stultifying him.
self, is to veto this initiation bill and employ
| the surplus revenue in reducing the legal
tenders to the level at which he found them when
he came into Office in 1859. But suppose
he signs the bill. The twenty million sur
| plus will then have to be employed in buying
bonds. or remain in the Treasury as an addl-
| ton to the cash balance, in the shape either
| of coin or currency. If it remain In the
| Treasury as an addition to the currency bal
| ance it utterly defeats the object of the bill,
| so far as its purpose Is to MAINTAIN the ex-
| cess of greenbacks in circulation. LII 1T re-
main in the Treasury as an addition TO the
coin balance, it will make a serious disturbance
| in the gold MARKET which is now but moder-
ately stocked, owing to the heavy exports
of the last two months. and could
not stand a drain of twenty millions
| by the Treasury within the next five
months, unless reinforced by importations
from abroad. TO the accumulation OF gold In
the Treasury as part of settled plan for the
resumption of specie payments, we should not
object, but such disturbance Of our foreign
trade as would follow the withdrawal OF
twenty millions from this city at the season
of the great importatons for the Fall trade is
not to be contemplated without dread


There remains to be considered the method
| of buying bonds AS no bonds are to be had
Mt less than par, call would have to be
issued. The bonds, even If called Immediately,
would not come in for payment until October.
and meanwhile the settlements for the heavy
importations of August and September would
be impeded by the constant drafts on the
available supply of gold, which would
be rapidly diminished by tho payment
of duties. But why, the reader may
ask. has this not happened beforei 1t has
happened, even when the Secretary has been
able to buy bonds at less than par. We do
not forget how, from April last year until
September, gold ranged from 11j to 119, and
the clamor that was raised and the frantic
but disinteresed efforts of Mr.. Richardson to
rescue those who had sold what they did not
OWN, and the panic that followed. But we
leave it to our intelligent merchants to fol-
low out this train of reasoning. Admitting
the surplus-whether fifteen, or twenty, or
twenty-five millions does not matter-that sur
plus must lie in the Treasury till October.
| There is no way of getting it out
that We can see. If it takes the
shape of gold there will be trouble. If
it takes the shape Of currency no harm will
follow. But why not permit it to take the
shape of reduction of the outstanding green
backs to 1856, OOOOOO3 We submit that the
President even if disposed on other grounds
to sign the bill, is not at liberty to overlook
its probable effects on the slowly revivng
trade of the country. We do not hesitate to
saw that Congress has left the Secretary of
the Treasury no choice in certain emergencies
but to come into violent collision with those
regular movements of gold and currency
which are indispensable to the prosperity Of
trade and industry.


We have but little space for the examination
of the hopeful scheme for Initiating the cur
rency from the reserves of the banks. One
seventh part of the lawful money usually held
by the banks is to be taken from their vaults
and locked up in the United States Treasury,
where it will be wholly unavailable in such an
emergency as that of last Fall. The notorious
defect of our banking has been the insuficiency
of the reserves Hence the repeated suspen-
sions of 1S37-9 of which all business men of
advanced years have vivid recOllectiOns. The
infationists now propose to take One-seventh
of the reserves and lock them up in the Treas
ury of the United States, and disperse
twO-sevenths more among the peO-
pie. This is literally to add an extra
story to house by taking brick and
stone from the foundations. In 1857, before
the panic, the banks of the United States held
a reserve of sixty millions in Specie against
an indebtedness of $2SS 100000 to other banks
and to depositOrs. Now nothing standing on
| two legs is easier to knock down than our
banks have always been. They dropped, grace
fully but suddenly, last Fall. Massachusetts,
has given the country Boutwell,, Richard
son, and Butler. To these must now be ad-
ded Dawes. Ii the measure champiOned by
him meets the expectations of the majority of
those who voted for it, we shall have system
of two thousand banks owing, besides their
notes, eight hundred million dollars payable on
demand, and holding as reserve in greenbacks
about the same amount that the banks in 1857
held in specie against liabilities only One-third
as great. Here is laid fine train of powder.
| 1t is an awful subject to reflect on, to think
/ what kind Of men run banks, and what kind
make laws for their guidance,