FINANCES OF THE UNITED STATES. 



283 



In accordance with the provisions of the act 

 of December 24, 1872, the offices of assessors 

 and assistant assessors of internal revenue have 

 been abolished, and all their final accounts 

 approved by the Commissioner of Internal 

 Kevenue, and referred to the accounting offi- 

 cers. The number of these offices varied ac- 

 cording to the exigencies of the service, being 

 greatest in 1868, when there were three thou- 

 sand and forty-three, of which two hundred 

 and forty-one were assessors ; since which 

 time the number had, up to the taking eflect 

 of the act above referred to, been reduced 

 about one-half. 



The system of collecting taxes by stamps, 

 and without assessments, has been found to 

 give general satisfaction. Since its application 

 to special taxes they have been collected more 

 promptly and thoroughly, and a more gratify- 

 ing and healthy increase in the receipts there- 

 from is apparent. 



Arrangements for refunding the debt were 

 commenced in January, and have been con- 

 tinued during the year with considerable suc- 

 cess. Subscriptions were made to the new five 

 per cent, funded loan to the extent of $84,000,- 

 000, and the proceeds were, as fast as subscrip- 

 tions matured, devoted to the redemption of 

 an equal amount of five-twenty bonds bearing 

 six per cent, interest. The $15,500,000 re- 

 ceived from Great Britain, as the Geneva 

 award, were used to redeem so far outstanding 

 public debt bearing six per cent, interest, and 

 an equal amount, so redeemed, has been in- 

 vested in five per cent, bonds of the funded 

 loan. At the maturity of the above-mentioned 

 subscriptions there will have been effected a 

 con version of the debt amounting to $100,000,- 

 000, making an annual saving of interest to 

 the amount of $1,000,000. The whole amount 

 converted into this loan, since the passage of 

 the refunding act, is $300,000,000, reducing 

 the annual interest charge $3,000,000. 



The condition of the carrying trade with 

 foreign countries, though exhibiting a large 

 adverse balance, shows some slight gains, 

 with prospects of still further improvements. 

 Of the exports and jmports during the year, 

 twenty-seven per cent, were carried in vessels 

 belonging in the United States, which is a gain 

 of three per cent, over the previous year. 



The increase in ship-building in the country 

 has been important. Official numbers were 

 awarded by the Bureau of Statistics to 1,699 

 vessels, of the aggregate tonnage of 313,743 

 tons. During the preceding year the addition 

 to the mercantile marine was 38,621 tons. 

 Since the close of the last fiscal year still 

 greater activity haa prevailed in the yards of 

 the Atlantic sea-coast. From July 1st to No- 

 vember 1st documents have been issued to 

 1,288 completed vessels, of 181,000 tons. In- 

 complete returns, however, indicate that there 

 were building, in October, 386 vessels, of the 

 tonnage of 177,529 tons, including 69 steamers, 

 with a tonnage of 67,007 tons. 



The action of the Treasury Department, dur- 

 ing the financial panic which prevailed in the 

 month of September, is thus briefly stated : 



This year there was a great demand for currency 

 to pay for the heavy crops of a bountiful harvest, 

 for which the European countries oft'ered a ready 

 market. The suspension of certain large banking- 

 houses, the first of which occurred on the 18th day 

 of September, alarmed the people as to the safety of 

 banks and banking institutions in general. Sud- 

 denly there began a rapid calling in of demand 

 loans and a very general run on the hanks for the 

 withdrawal of deposits. Entire confidence was 

 manifested in United States notes, and even in na- 

 tional bank-notes, and they were drawn wherever 

 they could be obtained, and were largely hoarded 

 with as much avidity as coin was ever hoarded in 

 times of financial distress when that was the cir- 

 culating medium of the country. The banks found 

 themselves unable to meet the demands upon them, 

 currency in circulation became exceedingly scarce, 

 and the business of the country became greatly em- 

 barrassed. 



In this condition ofothings, great pressure was 

 brought to bear upon the Treasury Department to 

 afford relief by the issue of United States notes. 

 The first application came from a number of gentle- 

 men in New York, suggesting that no measure of 

 relief would be adequate that did not place at the 

 service of the banks of that city twenty million 

 dollars in United States notes, and asking that the 

 Assistant Treasurer of New York should be author- 

 ized to issue to those bonks that amount of notes as 

 a loan upon a pledge of clearing-house certificates 

 secured by ample collaterals, and for which certifi- 

 cates all the banks were to be jointly and severally 

 responsible. This proposition was declined, it 

 being clearly not within the duty or the authority 

 of the Treasury DepartmeEt, under any provisions 

 of law, thus to employ the public money. 



Exchange on Europe having fallen to unusually 

 low rates, and indeed having become almost unsala- 

 ble in the market^ to the embarrassment of our for- 

 eign and domestic trade, application was made to 

 the Secretary of the Treasury to use the monev in 

 the Treasury in the purchase of exchange. The 

 Treasury Department having no occasion to do this 

 tor its own use, and no necessity for transferring 

 funds to Europe, was compelled to decline this 

 proposition, which, if accepted, would have put the 

 department in the position of becoming a dealer in 

 exchange, a position clearly inconsistent with its 

 duties. 



Subsequently the New York Produce Exchange 

 made a proposition to accomplish the same result in 

 8 different form, and also requested, as others had 

 before, that the Secretary should pay at once the 

 twenty million loan of 1868. 



The Chamber of Commerce of Charleston, 

 South Carolina, petitioned for the transfer of 

 currency to that city, and the purchase with 

 it, at that point, of exchange on New York, to 

 aid those engaged in forwarding the cotton- 

 crop to the market. To all these propositions 

 the simple answer was, that the department 

 had not the authority to comply. 



The Executive Department of the Government 

 was anxious to do every thing in its power, under 

 the law, and with due regard to the protection of 

 the Treasury and the maintenance of public credit, 

 to allay the panic and to prevent disaster to the le- 

 gitimate commercial and industrial interests of the 

 country ; but it was found impossible to afford the 

 relief in any of the many forms in which that relief 

 was asked. It was decided, therefore, to adopt the 

 only practicable course which seemed to be open to 

 it, the purchase of bonds for the sinking fund to 



