FINANCES OF THE UNITED STATES. 



255 



ublic and private, within the United States, except 

 uties on imports and interest as aforesaid. 



Act limiting the Amount of " Greenbacks." 

 June 30, 1864. An act to provide ways and means 



for the support of the Government, and for other 



purposes. 



SEO. 1. Be it enacted, etc., That the Secretary of the 

 Treasury be, and he is hereby, authorized to bor- 

 row, from time to time, on the credit of the United 

 States, $400,000,000, and to issue therefor coupon or 

 registered bonds of the United States, redeemable at 

 the pleasure of the Government, after any period 

 not less than five, nor more than thirty years, or, if 

 deemed expedient, made payable at any period not 

 more than forty years from date. And said bonds 

 shall be of such denominations as the Secretary of 

 the Treasury shall direct, not less than fifty dollars, 

 and bear an annual interest not_ exceeding six per 

 centum, payable semi-annually in coin. And the 

 Secretary of the Treasury may dispose of such bonds, 

 or any part thereof, and of any bonds commonly 

 known as five-twenties remaining unsold, in the 

 United States, or, if he shall find it expedient, in 

 Europe, at any time, on such terms as he may deem 

 most advisable, for lawful money of the United 

 States, or, at his discretion, for Treasury notes, cer- 

 tificates of indebtedness, or certificates of deposit 

 issued under any act of Congress. And all bonds. 

 Treasury notes, and other obligations of the United 

 States, shall be exempt from taxation by or under 

 State or municipal authority. 



SEC. 2. That the Secretary of the Treasury may 

 issue on the credit of the United States, and in lieu 

 of an equal amount of bonds authorized by the pre- 

 ceding section, and as a part of said loan, not ex- 

 ceeding $200,000,000 in Treasury notes, of any de- 

 nomination not less than ten doflars, payable at any 

 time not exceeding three years from date, or, if 

 thought more expedient, redeemable at any time 

 after three years from date, and bearing interest not 

 exceeding the rate of seven and three-tenths per 

 centum, payable in lawful money at maturity, or, at 

 the discretion of the Secretary, semi-annually. And 

 the said Treasury notes may be disposed or by the 

 Secretary of the Treasury, on the best terms that can 

 be obtained, for lawful money ; and such of them as 

 shall be made payable, principal and interest, at ma- 

 turity, shall be a legal tender to the same extent as 

 United States notes for their face value, excluding 

 interest, and may be paid to any creditor of the 

 United States at their face value, excluding interest, 

 or to any creditor willing to receive them at par, in- 

 cluding interest, and any Treasury notes issued under 

 the authority of this act may be made convertible, 

 at the discretion of the Secretary of the Treasury, 

 into any bonds issued under the authority of this 

 act. And the Secretary of the Treasury may redeem 

 and cause to be cancelled and destroyed any Treas- 

 ury notes or United States notes heretofore issued 

 under authority of previous acts of Congress, and 

 substitute, in lieu thereof, an equal amount of Treas- 

 ury notes such as are authorized by this act, or of 

 other United States notes : Provided, That the total 

 amount of bonds and Treasury notes authorized by 

 the first and second sections or this act shall not ex- 

 ceed $400,000,000, in addition to the amounts here- 

 tofore issued ; nor shall the total amount of United 

 States notes, issued or to be issued, ever exceed 

 $400,000,000, and such additional sum, not exceeding 

 $50,000,000, as may be temporarily required for the 

 redemption of temporary loan ; nor shall any Treas- 

 ury note bearing interest, issued under this act, be 

 a legal tender in payment or redemption of any 

 notes issued by any bank, banking association, or 

 banker, calculated or intended to circulate as money. 



The Funding Bill, July 25, 1868. 

 An act providing for payment of the national debt, 

 and for the reduction of the rate of interest thereon. 

 Be it enacted, etc., That the Secretary of the Treas- 



ury is hereby authorized to issue coupon or regis- 

 tered bonds of the United StateSj in such form as he 

 may prescribe, and of denominations of one hundred 

 dollars, or any multiple of that sum, redeemable in 

 coin at the pleasure of the United States after thirty 

 and forty years, respectively, and bearing the fol- 

 lowing rates of yearly interest, payable semi-annu- 

 ally in coin, that is to say : The issue of bonds fall- 

 ing due in thirty years shall bear interest at four and 

 a half per centum ; and bonds falling due in forty 

 years shall bear interest at four per centum ; which 

 said bonds and the interest thereon shall be exempt 

 from the payment of all taxes or duties to the United 

 States, other than such income tax as may be assessed 

 on other incomes, as well as from taxation in any 

 form by or under State, municipal, or local authority, 

 and the said bonds shall be exclusively used, par for 

 par, for the redemption of or in exchange for an 

 equal amount of any of the present outstanding bonds 

 of the United States known as the five-twenty bonds, 

 and may be issued to an amount, in the aggregate, 

 sufficient to cover the principal of all such five-twenty 

 bonds, and no more. 



SEC. 2. That there is hereby appropriated out of 

 the duties derived from imported goods the sum of 

 one hundred and thirty-five millions of dollars annu- 

 ally, which sum, during each fiscal year, shall be 

 applied to the payment of the interest and to the 

 reduction of the principal of the public debt in such 

 a manner as may be determined by the Secretary of 

 the Treasury, or as Congress may hereafter direct ; 

 and such reduction shall be in lieu of the sinking 

 fund contemplated by the fifth section of the act en- 

 titled " An act to authorize the issue of United States 

 notes, and for the redemption or funding thereof, 

 and for funding the floating debt of the United 

 States," approved February twenty-fifth, eighteen 

 hundred and sixty-two. 



SEO. 3. That from and after the passage of this act 

 no percentage, deduction, commission, or compen- 

 sation of any amount or kind shall be allowed to any 

 person for the sale, negotiation, redemption, or ex- 

 change of any bonds or securities of the United 

 States, or of any coin or bullion disposed of at the 

 Treasury Department or elsewhere on account of the 

 United States ; and all acts or parts of acts author- 

 izing or permitting, by construction or otherwise, 

 the Secretary of the Treasury to appoint any agent, 

 other than some proper omcer of his department, to 

 make such sale, negotiation, redemption, or exchange 

 of bonds and securities, are hereby repealed. ' 



Another proposition, which received some 

 favorable consideration, was to postpone the 

 payment of any part of the principal of the 

 public debt until the national resources should 

 be so increased as to make the payment more 

 easy. 



The opinion has heretofore been steadily 

 maintained by the Treasury Department, that 

 a reduction of the paper circulation of the 

 country until it appreciated to the specie stand- 

 ard was the true way out of the financial em- 

 barrassments of the country. This policy was 

 decidedly condemned by Congress, and an act 

 passed limiting the amount of reduction which 

 might be made. It is now, therefore, aban- 

 doned by the Department, which recommends 

 as the next best step that coin contracts should 

 be legalized. At present* the courts will not 

 enforce contracts or agreements made for the 

 payment of coin. In all the States except 

 California, coin contracts made before the pas- 

 sage of the legal-tender acts, as well as those 



* The legality of coin contracts was sustained by a de- 

 cision of the Supreme Court in February, 1869. 



