700 



SOUTH CAROLINA. 



bonds have been already issued, and $2,500,000 of 

 registered stock, and $3,500,000 or sterling bonds, are 

 in tlie hands of the State authorities, to be issued in 

 connection with the conversion of the remaining 

 $6,000,000 of old bonds. Of course, all these issues 

 are accompanied with the cancellation of an equal 

 amount of old obligations, and involve no increase 

 of the State debt. It may be asked, however, what 

 of the remaining $9,000,000 printed? In the first 

 place, these are not bonds, not having been signed. 

 They are simply so many blank forms, which the 

 State Treasurer holds for the same purpose as the 

 United States Government holds a reserve of blank 

 registered bond forms, or a railroad holds a supply 

 of blank stock certificates. 



Later in November, in his annual message 

 to the new Legislature, the Governor gave 

 what he termed a full and correct statement 

 of the actual debt of the State, from the Treas- 

 urer's books. This gave, as the total amount 

 of bonds and stocks printed by the American 

 Bank Note Company, $22,540,000, accounted 

 for as follows : on hand in the State Treasury, 

 $3,072,800 ; deposited for safe keeping with 

 American Bank Note Company, $6,000,000; 

 cancelled and destroyed, $3,953,200 ; outstand- 

 ing, $9,514,000 : 



Old debt ... $6,665,908 98 



Less old bonds, paid July 1, 1871 212,000 00 



$6,453,903 98 



New bonds 9,514,000 00 



Less in hands of financial agent, to the 

 credit of sinking fund commission 200,000 00 



$9,314,000 00 



New bonds, in hands of financial asjent, 

 now in use as collateral security for loans . 3,773,000 00 



Amount of new bonds sold $5,541,000 00 



Old debt, as above 6,453,908 98 



$11,994,908 98 



The Governor stated that the increase in 

 the bonded debt of the State represents mostly 

 liabilities contracted under previous adminis- 

 trations, the form or obligation in some cases 

 alone being changed, while a large fraction 

 consists of bonds issued to meet the matured 

 principal and accruing interest of the ante- war 

 debt, in order to maintain the faith and credit 

 of the State. Regarding the alleged over-issue 

 of bonds, he said that, by the combined effort 

 of the opponents of his administration, includ- 

 ing the Chamber of Commerce and Board of 

 Trade of Charleston, to depreciate the bonds 

 heretofore issued, their purchasing value was 

 seriously diminished, and it was necessary to 

 increase the amount of bonds to raise the given 

 amount of money called for by the several laws 

 of the State. 



Concerning his statement in September, to 

 the congressional committee, 'the Governor 

 said it was correct to the best of his knowledge 

 at that date. His information as to the sale 

 of bonds was then necessarily limited to the 

 amount reported by the financial agent and 

 the Treasurer. 



Soon after the reception of the Governor's 

 message, a committee was appointed to inves- 

 tigate the alleged over-issue of bonds. They 



reported that, in their opinion, the State had 

 been defrauded by an over-issue of State bonds 

 amounting to $6,314,000. These were issued, 

 the committee stated, by the financial agent 

 in New York, under the direction of the finan- 

 cial board, which is composed of the Governor, 

 Attorney-General, and State Treasurer, subse- 

 quent to August 26, 1870, the date at which 

 a twenty-four months' limitation fixed by law 

 for the issue of bonds expired, pursuant to an 

 act of March 26, 1869, entitled " An act to au- 

 thorize the financial agent of the State of South 

 Carolina, in the city of New York, to pledge 

 State bonds as collateral security, and for other 

 purposes," and were, therefore, clearly illegally 

 issued. The committee further reported that 

 the State Treasurer and the financial agent had 

 neglected to make their annual reports as re- 

 quired by law. On the strength of these state- 

 ments of the investigating committee, resolu- 

 tions of impeachment against the Governor 

 and Treasurer of the State were introduced 

 into the House of Representatives. After sev- 

 eral days of excited discussion, the resolution 

 to impeach the Governor was defeated by a 

 vote of 32 to 63 ; and that for the impeach- 

 ment of the Treasurer by a vote of 27 to 63. 



Subsequently, the Governor sent in to the 

 Legislature a long message in reply to the 

 charges made against him. In this he de- 

 clared that the investigating committee had 

 improperly construed the meaning of the 

 law, and emphatically denied that there had 

 been any over-issue of bonds, or that any one 

 bond, of any class, had been issued except 

 in pursuance of law. "Whenever the acts au- 

 thorizing the issue of State securities were 

 susceptible of the slightest doubt of their real 

 meaning and intent as regarded the issue of 

 any class or amount of bonds, and their sale 

 or hypothecation, the opinion of the Attorney- 

 General, he said, was required and obtained 

 by the financial board ; and no bond had been 

 issued contrary to his opinion. 



Great excitement was created during the 

 entire year throughout the State, by the re- 

 ports of lawless acts, outrages, and murders in 

 the " upper country," including the counties 

 of Spartanburg, York, Union, Chester, Laurens, 

 Newberry, Fairfield, Lancaster, and Chester- 

 field, by organized so-called " Ku-klux " bands, 

 composed of enemies of the negroes and the 

 dominant party, and the proceedings of tho 

 State and national Government against them. 

 Early in January the Legislature appealed to 

 the Governor to place a sufficient military force 

 in the " riotous and refractory " counties for 

 the protection of life, liberty, and property, 

 and to bring the outlaws in them to punish- 

 ment ; but he replied by special message that 

 the information at the time in the possession 

 of the Executive department would not war- 

 rant such proceeding, and further, that if there 

 was any portion of the State in which violence 

 and disorder were so general as to disarm the 

 power of the civil courts, he had no such mili- 



