Democratic Sentinel, Volume 16, Number 20, Rensselaer, Jasper County, 3 June 1892 — AN INHERITANCE. [ARTICLE]

AN INHERITANCE.

Tlw Whig Party Responsible for the State Debt, As It Cheated a Major Portion of That Heavy Burden To Which the Republicans Have Made Additions. A Comprehensive View of the Financial Condition of the State—Public Works i Craae the Origin of the Present Public Indebtedness —What Has Been Done bp Democratic Administrations to Keduce It. Concerning the state debt Judge Lewis Jordan, of Indianapolis, says: The legislature of Indiana in 1836 and subsequent years authorized an extensive system of internal improvements by the state. The Whig party was in control, but the craze for these public works swept over the state, and the votes of members of both parties were controlled by local interests. The money to make the canals and roads had to be borrowed, and in a few years the debt of the state amounted to over $11,000,000. lin 1841 the crash came and the state" could not even pay the interest on this vast sum, much less any part of the principal. By the advice and influence of Governor Whitcomb the legislature of 1846 proposed a compromise to the creditors of the state, which a large- majority of them accepted. By the terms of this compromise these creditors accepted the Wabash and Brie canals for one-half the principal of their bonds and one-half of the accumulated interest. For the other half of the principal, state stock bearing 6 per cent, interest was issued, and for the one-half of accumulated interest state stock bearing 2 1-2 per cent, interest. For this great service Governor Whitcomb deserves a monument erected by the state. He restored the credit of Indiana. All the creditors of the state did not accept the compromise, and during the administrations of Governors Hendricks, Williams and Porter there was paid on these old internal improvement bonds $712,852.18, and thousands of dollars have been paid since, the supreme court ■having decided that that they must be paid in full, principal and interest. The state five and two-and-a-half per cent, stocks were taken up by investing the trust funds of the state in them, but over $5,000,000 of this old improvement debt has never been paid, and today this amount represents more than one-half of the state debt. The state has nothing to show for it. The editor who publishes, or the stump speaker who asserts, that the Democratic party made this part of the state debt is either an ignoramus or a willful falsifier of the history of the state. The unpaid internal improvement bonds appeared in the public debt statements up to 1864, but in 1865 the state auditor left them out. Honest Governor Baker, in his last message, delivered January 10, 1873 (see house journal, page 18), said they should have t>een included in the annual debt, statements. He estimated in that message that it would require $569,000 to take them up, but his estimate was too low, as Governors Hendricks, Williams and Porter paid $712,852.18 on them, and large sums have been paid since, as I have stated above. Governor Baker said in this same message, delivered three days before Mr. Hendricks became governor, that the state debt was $4,650,830.37, but he only included $569,000 of those internal improvement bonds in his statement. This was $200,000 too little, as time has demonstrated. Add this $200,000 to the amount of the state debt as given by Governor Baker and it makes the state debt when (Mr. Hendricks became governor $4,850,830.37. But Governor Baker in this same message admits that the state treasury was bankrupt, and said “that the collection of the revenue of 1873 will have to be anticipated by a temporary loan.” (See page 20, house journal, 1873.) This loan was made immediately after the inauguration of Governor Hendricks and amounted to $200,000. It is justly chargeable to the administration of Governor Baker, and when added to the amount of the state debt, as stated by him, increased by the $200,000 of additional internal improvement bonds which he did not estimate, makes the true amount of the state debt at the beginning of Governor Hendricks’ term over Five Million Dollars. These honest and true statements of Governor Baker as to the amount of the debt and the condition of the state treasury at the dose of his term, put to shame the liars who make it a business to retail their lying charges against the Democratic party during every canvass. I now challenge them to show by the record that the state debt was permanently increased during the administrations of Governor Hendricks and Williams. It was in fact reduced, for in 1881 when Porter became governor the debt was only $4,876,608.34. Governors Hendricks and Williams not only reduced the state debt, but at the same time built and equipped the Insane Hospital for Women at Indianapolis, and also expended large sums for

exteensive improvments on other state institutions. The foundation for the growth of the debt was laid during the administration of Governor Porter, and he, more than any one else, is responsible for it. The legislature of 1883, while he was governor, authorized the erection of three additional hospitals for the insane, and appropriated $600,000 “to carry out the provisions of the act.” (See acts 1883, page 164.) What were the provisions of the act ? The act says “for the construction and equipping of three hospitals for the insane.” Governor Porter permitted the bill to become a law without his signature, but he did select the members of the board, and was its president under the terms of the law. The state tax levy had not been increased by the legislature that ordered the new hospitals, and there was not a dime in the treasury to pay the $600,000 appropriation. Governor Porter and his board were not deterred from acting by this fact. They even did not confine themselves to the sum appropriated, but adopted plans which resulted in making these hospitals cost $1,500,000. Every cent of this vast sum was borrowed, and thus increased the state debt. The location and plans of construction of these hospitals has been severely criticised, but this is aside from this discussion. It is announced that Governor Porter is to take part in the coming canvass, and if the Republicans are anxious to continue the discussion of the responsibility for the increased state debt, some pointed questions must be propounded to Governor Porter, and explanations will be in order. He sowed the seed which yielded a large increase of the debt, and he did this when the tax payers were building the state house. It will not do to charge that the money to pay for the hospitals was borrowed by Governor Gray. The obligations were contracted by Governor Porter’s administration and had to be paid or repudiated by the state. Boomed by a Republican House.

The Republican house of 1887 started another boom of the state debt by the extraordinary appropriations for the soldiers’ monument, the soldiers’ orphans’ home and other state buildings. (See acts of 1887.) lam not criticising these appropriations, but fixing the responsibility for the increase of the debt. By these appropriations, which could not have been made if the Republican house of 1887 had not consented, well-nigh on to half a million dollars were added to the state debt. This same Republican house of 1887 refused to continue the state house tax and thus made it necessary to borrow $700,000 to complete and furnish the state house. They again boomed the state debt. This same Republican house of 1887 wanted to borrow $2,000,000 to squander, but a Democratic senate blocked the game. This was part of a scheme to injure Governor Gray, as the $2,000,000 loan was to be charged up against his administration. It never occurred to this Republican house that it was its duty to increase the state tax levy to raise money to pay the large, extraordinary appropriations it made. The Democrats have been denounced with stint for not raising the levy, but the Republican house of 1887 refused to do this very thing. The Republicans will please take a large dose of their own medicine, and take it often, so they will cease lying about their opponents. It will thus be seen from the above that the increase of the state debt in the last twelve years was nearly all caused by a Republican governor and Republican house. ' It would be interesting to have the names of any Repub-

lican members of the legislature who voted against extraordinary expenditures for public buildings in the past twelve years. They all voted for and advocated them. While denouncing the increase of the state debt and the increase of the state tax levy, the Republican papers are now advocating schemes which will require large appropriations to carry them out. Since 1877 the state tax levy has been only twelve cents on the SIOO. All now see and admit that this was not enough to pay current expenses and make the large improvements on state institutions and build new ones. The economical and wise administrations of Governors Hendricks, Williams and Gray made it possible to borrow money for 3 per cent All the borrowed has been applied to building, and the state has its magnificent institutions to show for it. It is the meanest kind of demagogery to attempt to make political capital out of the financial transactions of the state, and by perverting the facts. Governor Hovey saw the necessity of an increase of the state tax to twentyfive cents. Because a Democratic legis- , lature fixed it at eight cents below the recommendation of a Republican gov- ! emor it is denounced. Personally, 1 ! would have favored cutting down the 1 state school tax to fourteen cents and in- ' creasing the state tax to fourteen cents. But the time has come for the state to face the music and pay that part of the debt which was created to build the insane hospitals, soldiers’ orphans’ home, institute for feeble minded children, soldiers’ monument, and to make the large additions to all the other state institutions. And the time has come to call a halt in making any extraordinary appropriations until this part of the debt i is mud. The old debt of $5,000,000 might be continued as a relic of the internal improvement craze of 1836-7.