310 



FINANCES OF THE UNITED STATES. 



source are expected to increase under almost 

 any circumstances. The tax is evaded by an 

 omission to use stamps according to the require- 

 ments of the law, and by a non-cancellation 

 and re-use of them. 



It is believed that the sources of revenue 

 above stated, with some others which have not 

 been mentioned, may be relied on to furnish 

 one hundred and fifty-two millions of dollars 

 under almost any contingency. These receipts 

 may be briefly recapitulated, as follows : 



From distilled spirits (new system) $50,000,000 



' fermented liquors 6,000,000 



' tobacco and its manufactures 20,000,000 



" income 85,000,000 



' stamps 17,000.000 



legacies and successions 2,000,000 



" banks, railroads, etc 10,000,000 



" salaries 1,000,000 



' gross receipts 7,440,000 



' miscellaneous (schedule A, etc.) 2,100,000 



' fines, penalties, etc 1,460,000 



$152,000,000 



Treasury, in a correspondence on the subject, 

 expressed'the following views : " I consider the 

 faith of the Government pledged to pay the 

 five-twenty bonds, when they are paid, in coin. 

 There need be, I think, no apprehension that 

 they will be' called in at the expiration of five 

 years from their respective dates, and paid in 

 United States notes. The United States notes 

 were issued under the pressure of a great neces- 

 sity, and are, by authority of Congress, being 

 rapidly withdrawn from circulation. No more 

 can be issued under existing laws ; nor can I 

 believe that any considerable number of mem- 

 bers of Congress would favor an additional issue 

 for any ordinary purpose, much less for the pur- 

 pose of paying bonds, in violation of the express 

 understanding under which they were negotiated. 

 "The policy of contracting the circulation of 

 United States notes, adopted by Congress, and 

 being steadily pursued by the Secretary, should 

 of itself, even if the honor of the nation were 

 The amount to be obtained by internal reve- not involved in the question, satisfy holders 

 nue taxes, to enable the Government to meet its that five-twenty bonds will not be called in and 

 expenditures, was estimated by the commission- paid before maturity in a depreciated currency." 

 er at one hundred and seventy millions of dol- The finance committee of the Senate made a 

 lars. The additional sum of eighteen millions report on December 17th, which embraces 

 he would raise by an advance of special or li- among other questions the argument advanced 

 cense taxes generally. These details of the for paying the bonds in legal-tender notes, 

 measures proposed by the Commissioner of In- They say : 

 ternal Revenue, to provide for the. reduction of 



t>,n TM-iXUrt /i/aJf o,f/i 4-t* t it- The duties on imported goods and interest on the 



the publi^ debt and the expenditures of the blic debt are b f aw e xc!pted from the legal-ten- 



Government, are briefly recapitulated as follows: er clause. This implies that the principal of the 



Estimated receipts proposed system. debt is not excepted. The construction drawn from 



From Customs $150,000,000 the payment of previous loans in gold is answered by 



Internal Revenue, viz. : the fact, that the act under which these bonds were 



From Spirituous Liquors $50,000,000 issued expressly declares that a note shall bo lawful 



Tobago Liquors oo'ooo'ooo money as well as gold, and shall be receivable in pay- 



Income and Salaries 36000000 ment of a public debt. The argument that a construc- 



Gross receipts. '. Y.'.Y. .' '. '. ' 7,'400,'ooo tion was put upon the law by the agents of the United 



Stamps Y.Y.'.". ..... lt'ooo',000 States is answered by the fact, that this was not a 



Special taxes and sales 29,500,000 mutual construction recognized by both parties as a 



Legacies, etc 2,000,000 part of the contract, but was rather an opinion based 



Banks, etc., etc 13,500,000 upon a supposition of a state of facts which, when 



From miscellaneous sources. . . . . 000 000 000 tbe fl ^ cx P ired ' did not *Uy exist. It is 



' ' clear that if the bonds are payable when due in legal 



Total $331,400,000 tenders they are redeemable after five years from the 



1'' date in the same kind of money. The word" pay- 



Axpendttures not reduced on the basis of 1867. able "implies a duty or obligation which must be 

 For Interest of Debt ... $130,000,000 performed at the time stipulated. The word ' ' re- 

 Civil Service $51,110,000 deemable " implies a discretionary power which may 



^~" qi'nso ooo ? r ma y not be exerc i se d ; hut tlie same kind of money 



Pension's' 20 930 000 * n tn e same m de tendered will redeem a note or pay 



Indians...' 4' 640*000 a note. The committee have deemed it their duty to 



J 191,500,000 present the argument in favor of redeeming the bonds 



For Redemption of Debt o'ooo'ooo in legal-tender notes ; for it cannot be concealed that 



Balance 9,900,000 this construction has been adopted by many who dis- 



_ . , claim all purpose to evade the public engagements. 



>W1 , 1*51,400,000 gt-ji^ tne admitted fact remains that these bonds were 



Expenditures as reduced, for the fiscal year 1868-' 69. generally taken upon the supposition that they would 



For Interest of debt . . $130,000,000 be P a ^ in coin ; that this was expressly declared by 



For Civil Service $40000000 the authorized agents 01 the Government in negotia- 



War 53^000^000 ting the loan ; that such declarations must have been 



Navy 21,00o!ooo known by Congress, and were not negatived ; that it 



Pensions 21,000,000 was sanctioned by three successive Secretaries of the 



Indians 5,000,000 Treasury ; that upon the faith of it the bonds have 



For Redemption of Debt 50 00 ooo been continually higher in market value than the 



Balance 11 400 000 notes > and that P ublic sentiment, both in this couu- 



!__! try and in Europe, would regard it as a breach of pub- 

 Total $331,400,000 licfaith. 



A question was raised during the year rela- In the following table from the Financial 

 tive to the redemption of the gold-bearing bonds Chronicle are given the daily prices of gold at 

 in legal-tender notes. The Secretary of the New York during the year 1867 : 



