Indiana State Sentinel, Volume 26, Number 45, Indianapolis, Marion County, 27 June 1877 — Page 1

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V VOL. XXVI, NO 45. INDIANAPOLIS, WEDNESDAY MORNING, JUNE 27, WHOLE NO. 1910.

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THE PAX MY.

BY H. W. Sweet flower, what makes thee seem so jlal While hearts about thee feel so sad? Dost thoa not grow aweary ? Or hast thou aught in life e'er hail To make it seem adreary? Thy winsome smile doth ever beam, In Joys forever thou dost seem, Ever so bright and cheery; Thy sunny life seems like a dream And wilt thoa solve my query? What is the secret of thy joy, "Which naught on earth seems to destroy ; Though other lives are blighted, And my sad soul canst thou decoy From realms so much benighted? For surely thy swe-et aee was wrought "When nature chanced a happy thought. It ever is so smiling; And truly joy thou must have taught. Thy smile is so beguiling. Then pray, sweet flower, with face so fair, And features soft beyond compare, What is thy gift so holy, Allowing thee without a care To live in pleasure solely? In thy sweet face one surely sees That fate's command can only please, Thou feelest no resentment ; The answer softly caught the breeze "My secret is contentment." FINANCES. PnM,' Preent and Fntnre f the Qom tiun An Exhaustive Review. Milwaukee, June 19, 1877. To the Editor of the Sentinel : Sir The total debt of the United States in ItSGS was more than $2.000,000.000, of which $1,127,000,000 were 5 20 bonds. The main ouestion of the nation was. How should the principal of the 5 20 bonds be paid? That question was intimately connected with the value of the future dollar, and the credit of the nation depended on the answer. 13y the letter and spirit cf the legal tender act those bonds could be redeemed in greenbacks any time after five rears. Thus $514.780.500 in bonds were due in 1867-8; $120.444,800 were due November 1, 1S0!; $181,427,250 were due November 1, 1870, and $301,80,250 were due July 1, 181 all in legal tender notes. REPUDIATED. Now the government tacitly repudiated all nhliation to nav anv portion of the princi pal of the public debt in coin, and lenders took the government at its word by giving it no more for them than for bonds that were payable in paper. It was not supposed that the government woul j treat bondholders any better than it was bound to by the terms of the contract. The repudiation of coin oblizations was done when $00,000,000 of de mand notes of the treasury, and $140,000,000 or 7-30 treasury notes, issued pnor to tne passaee of the legal tender act, were paid in greenbacks. The -first issues of legal tender notes were redeemable in 5 20 bonds those created by the acts of February 25, 1862, July 11, 1862, and March 3, 1863 to the amount of $450,000,000. But when $1300,000,000 in 7-30 treasury notes were made exchangable for 5 20 bonds by the act of March 3, 1S65. the government stopped the ex change of greenbacks for said bonds; $4w,330,000 of 5-20 bonds had been so exchanged. The italics above are mine. They forcibly - describe the game by which the people of the United States have been blinded by the bankers and bondholders since the late war, regarding the conflicting Interests of the former with the selfish purposes of the latter in their efforts to increase the value ot the dollars which tbey gained so cheaply during . and since the late war. THE BONDED DEBT. The bonded debt ot tne united htates in 1S68 was composed of $1,127,531,800 5-20 6 per cent, bonds; $171,409,000 10-40 5 per cent bonds, redeemable March 1, 18 4, and - $75,000,000 1040 6 per cent bonds, redeem . able July 1, 1881; $50,000.000 20 year 6 per cent, loan of February, 1801, and $19,431, 000 20 year 6 per cent, loan of July ana August, 1801; $lb,0UU.UUU old year 6 per cent loan of the Mexican war, and $27,000. 000 old 20 year 5 per eent loan of 1858 and and 1860, and $139,315,300 or three year 7 3-10 per cent bonds of 1861. These all . amounted to a total of $1,G25,69.",150 bonded debt of the United States government. De ducting from this total the amount of 5 20 bonds $1,127,531,800 -there remains $VJ8, 000,000 of other bonds, showing that the 5-20 bonds were more than two-thirds of the entire bonded debt. But to the amount of other bonds must be added $488,647,425 of the $600,000,000 of 7-30 three year bonds, or treasury notes of 1SG5, thai were convertible . into 5-20 bonds at maturity, in July, 18oS. The interest, 7 310 per cent., being payable semi-annually, in legal tender notes, the holder bad the option to exchange or not for 5-20 bonds; bat the government could pay them in legal tender notes in 1868 when they matured, ana thereafter, thereby in encasing the currency, or redeem the 5 20 bonds already mat ired. amounting to $518, X),000. But it did neither. The $488,647, 425 three year 7 3-10 treasury notes of I860 being added to the amount of all the other bonds, ex'fvtins the 5-20 bonds, sums thus Ten-fortl' a ISotf -Ii,),?) ttixeof..XM 69,4.11,0)0 -Old 2) year loan 43,(0U,iO 7-30's of lil law, d.wvio 7-JO's of 15 48,847,425 Total ! -f.mjW,lZi Hence the 5-20 bonds exceeded all the then to the amount of $140,727,000. THE DEBT IN 1865. 1 The total debt July 1, 1868, was as follows: -5-20 bonds ..-.41,127A100 -Other bonds, etc........... Legal tender notm. ..... "Treasury not Compound Interest notes . siw,lii . 371,7t,SM7 1.1211,4 0 - 122,3m,4 i Temporary loans. Oo!l certificate... Fractional notes.. . 20,225.070 Other note 8Ö1U0 Demand notes Total debt. ... , S2,77,745,UU3 Thus, deducing from the debt all the notes above, circulating as currency, to the amount of $442,077.488. and all the 5 -20 bonds, there remains $1,108,135.715, showing that the 5 20 bonds were in 1868 more than half the actual debt of the nation. Now, of ' the $1,127,531.800 in 5-20 bonds, $514.780,000 -were redeemable in legal tenders after June 1, 1867; $3,882.500 were redeemable in the same "lawful currency" af'er November 1, 1863: in the aarae money $125 000,000 were redeemable after November 1. 18R; $181,427.000 were mt rede.-niiMe after November 1, 1870, and $.JÖ1.880 were redeemable after Jttlr 1. l3il). in gr-rnhicks 10. A the government had tacitly repudiated

all obligations to pay anv of the $00,000,000 demand notes and $140,000,000 of 7-30 treas

ury notes that were each and all issued prior to the passage of the act, February 25, 1$2, creating the United States note or greenback a legal tender, thereby proclaiming to the world its intentions rela tive to all bonds or debts that were not made payable in coin on the face of said bonds. All lenders thereafter took the government at its word by giving no more for them than for bonds that were payable in paper. It was not supposed that the government would repay its creditors more than it was bound to by the terms or the contract. &o the 5-20 bonds were bought with legal tender notes that were worth from 40 to 45 cents on the dollar in coin. THE FINANCIAL POLICY. Newcomb. in his essay entitled, "The Financial Policy of the Government," during the late war) which was published in 18io, says: 4 Had any one predicted mat in three years the notes which were declared a lepal tender for the entire principal of the public debt would only nave been wortn fröre 40 to 45 cents on the dollar in gold he would have been called a villainous slanderer of the public credit." Newcomb w&s no inena oi me legai ten der bill, which he ays "implied a vot of want of confidence in the nation Hence his criticisiras are worthy of notice, as they were written long before any effort was made to repudiate the payment of the legal tender bonds according to tneir iace. ine quotation above is from page 107 of Newcomb's Financial savs: "It was not the demand notes alone that were thus made payaoie oy receiving another note with the words 'On demand5 omitted. The new paper money was a legaltender in payment of the entire principal of the public debt" On page 115 he says: "liy tne letter ana spirit of the legal-tender act the bonds 5-20' s can be redeemed in notes at any time after five years. But at the time the 5-20 loan was all taken, an official announcement was issued from the treasury declaring that the principal of the entire permanent debt should De paid in coin. Thus we are placed in the following dilemma: If we pay the principal in coin, we shall eive the creditors much more than thev are entitled to by the strict terms of the contract. It we pay in paper we snau be accused of a breach of faith by foreigners who bought bonds without a thorough km wledze of the terms of the contract And after alludine to the payment of the loan of 1841, that was due January 1, 1863, in coin, and condemning the reaso is for do ing so, as set forth in a communication from the presidents of the principal New York city banks, advising the secretary of the treasury that the credit oi tne government would be promoted by paying the sum $3.000.000 in coin (which was loaned by said banks at 4 per cent, interest.) he says: jood laith demands mat every loan contracted bv the government when coin only was a legal tender, ought to be paid in coin." The rule laid down by Air. Chase regarding the payment of the princi nal of the five-twenties alluded to aoove, is criticised thus by Newcomb, pages 117 and 118: MR. CHASE'S IDEA. 'Mr. Chase ruled that the principal of the permanent debt, including all bonus, should be paid in coin, but that the principal of all the temporary loan was payaDie in legal tender notes. This decision give rise to the ethical qnestion: How does the circuni stance that a loan is 'temporary' modify the obligation to pay it? The difficulty of answering it is increased by the circum stance that the five-twenty loan, declared by Mr. Chase to be payable in coin, was all con tracted by borrowing paper, while the seven thirty loan, which is declared payable in paper, was nearly all contracted by borrowing coin. Then again he says: "in extenuation of the act of refusing to pay the holders of . 1 r,v , 1 7. I 1 iL.i . 1 tne i-dJ loan in coin, it is urzeu mat tnere was no agreement t pay it thus." rage 118. Twelve months previous to the passage o the legal tender act, when twenty millions of hearts were all aglow with enthusiastic patriotism, thousands of mechanics, farmers and workmen, each gave a hard-earned hun dred of gold or silver dollars to support the credit of their flag and government They received in return 7 3-10 notes; promises that the United btates would pay them 7 3-10 per cent per annum interest, and in three years, at the maturity of the notes. would repay them the "dollars" they hai loaned. But by the decision of the treasury, referred to, after the passage of the legal tender act, when the holder of the 7-30 notes presented them for payment, instead of getting his dollars back . he got only 45 per cent thereof in the shape o a "greenback" unless he preferred six per cent 5 20 bond. Page 92 Then, after showing how the republican leaders redeemed tne demand note that was receivable for customs by another that was not, ne says: "Was this paying the debt in th emanner understood between the pirtics at the time the debt was contracted? lha promises made by the government were modified without the consent of the party in whose favor tbey were made is undeniable The promise meant one thing at the time it was made; the meaning oi the words was afterward changed to that it should mean something else. Gold and silver had been the only legal tender of the governmen since the adoption of the constitution. For the first hundred million of the 7-30 notes i would accept nothing but gold or l.s equiva lent. Among -hose who thus loaned these coins to the government no one supposed that if the loan were ever repaid at all it would be repaid in anything but gold or silver coin or their equiv alents. To do otherwise would be breach of faith on the part of the govern nient But tbia was done when the govern ment needlessly suspended specie payment. instead of resorting to a system of direct and indirect taxation to procure the money re quired to carry on the war and meet the pay ment of the demand notes and other ma tnred and maturing indebtedness. Because the banks through which the war loans bad hitherto been negotiated could supply no more mony having supended specie pay ment when six pes cent, stock, usually com manding a heavy premium, was at a diacount of from wyen to fifteen per cent and because there wonld be a ceneral flow of de and notes to the treasury for redemp tion, the government ignobly follow ed tne eranipie of the banks by re fusing to redeem the notes. Bo these notes in circulation at tue close of 1861, to the amount of $00.000.000, each bearing the worJs, 'The United States will pay the bearer dollar on demand.' were paid, as the bankrupt pays his debts, . ., by discounting them. For the legal tender notes naturally grew out of this eus pension of specie payment of the demand notes two months afterwaM. Not only the obligation to pay on demaud, but, so . far. the public could di.cern, all obligations to pay at all, until the holder should chance to owe an equal debt to the government, was

deliberately repudiated. This weak, time

serving and timid act is a principal link in the chain which has brought on an our suosequent evils. We may say of every act of a government or an individual, mat it in volves and is founded upon some principle and some general rule of conduct In many caes the principles involved in the act fire roally of much more importance than the act itself because they may be the occasion of a Ion series of analogous acts. So it was with the legal tender act Its evu lay not In the . inception of a fact but in the establishment oi a pnn iple. It was not that we declared paper bearing an indefinite promise a legal tender, but that we adopted a rule of action under the operation of which puouc credit was bat an empty sound. It was not that the treasury of the nation happened to be in a strait for money, but that it pretended to pay when it did not No man who believes that lionestv is the best policy: that a nation as well as an individual in search of credit should exhibit the most scrupulous honor in fulfilling all obligations, can doubt that tne counsels which suggested this course were the very worst that could be adopted. Had the treasury allied itseti with the side oi confidence by resolutely continuing specie payments, it might have prevailed. The suspension, except during the Bhort time necessary to negotiate a temporary loan, was as unnecessary and unjustifiable as it was weak. A heavy tax, say six per cent per annum on the repudiated bank circula tion would ot itseii nave stoppea tue run on the treasury in 43 hours after it was imposed. The banks would then have called in theijr notes as rapidly as possible, and there would have been a positive necessity for either gold, silver, demand notes, or other government money to fill the vacuum. No doubt such a measure would have caused much complaint on the part of the banks. - But which is of the most importance, the honor of the government and moral standing of the nation, or tne interest oi tnose corporations i It must , be remembered mat such a tax would only have deprived the banks of a source of profit to which the government has a far better right than they: namely, the interest on the money circulating throueh the channels of business. Indeed, as the future will prove, the course actually pursued will be more disastrous to tne Dans interests than a compulsory prohibition of all their business would have been." Page 103. Regarding the state of public sentiment which led the nation to look upon the suspension of specie payment and the legal tender paper wita so nuie aissausiacuon, ne continues: "The eeneral complacence with which our mercantile community look upon the failure of a house to make good its obligations; the frequency of such failures, and the circumstance that they are not considered as com promising the honor of the defaulters in any degree whatever, have been thrown into our faces by our transatlantic brethren as indicative of our very lax notions of public moral ity. But the imputation is neither just nor reasonable, so lone as rood faith is kept be tween the parties. When one merchant gives credit to another, or furnishes a young man with stock in trade, It is done witn me tacit understanding that the obligation of the debtor ceases, u, through losses in business, he becomes unable to pay The creditor of course charges a little more on account of the risk insuring the debt as an insirance company insures a house, and it may be mat mis svstem of debt insurance is as beneficial to the community as fire insurance. It cer tainly is as honest. But when we extend this system of debt insurance into transactions of a public character we start on the road to infinite' evil. The frequency with which our banks have for a longer or shorter period suspended specie payments has habituated the public to read every bank note, with the mental reservation, "If we don't suspend!" just as every promissory note contained the understood proviso, "If I am able!" THE QCESTIOS. Now the question arises: Ought this or any other proviso to be understood as quali fying the promises to pay of the govern ment? Most certainly not, except as cir cumstances absolutely beyond the control of the treasury might temporarily com pel it Absolute inability of the na tion to redeem its obligations to its own cit izens is almost a physical impossibility. For paying such obligations is nothing more than equalizing the. unequal contributions or taxes of individual citizens so that each one shall have contributed bis just 6hare of tax to sustain his government The evils of the suspension of specie payments by the national treasury were greater than those involved in the suspension of the banks, owing to the different conditions of the two institutions. A well managed bank always holds in its vaults either coin or promissory notes of responsible persons sufficient to pay all demands upon it, and to make good its capital beide. All these notes would be due in less than 00, perhaps 60 days, according to the time of discount. The government, on the contrary, held no Buch notes, and pay ment would have to be left entirely to its sense of good faith. Hence the more disastrous consequences of its refusal to pay as promised. But the government had a power which no bank has, that of levying taxes to any extent on the whole country, so hat Its failure to pay could be due to its indolence or to moral cowardice." Tage 105. Mr. Newcomb gives the following table showing (1) the average price of gold In legal tender notes; (2) the value in goid of $100 in legal tender notes; (6) the market value, in gold, of 5-20 6 per cent bonds accrued in terest for the halt year taken on: Uold value of $100 in legal tender notes. m m VT I 86 87 84 77 7 7 ' 70 S3 w e 00 7 7S 75 e 4 6 i I 67 51 40 . 3 44 49 45 44 Gold value or 1100 5-20 percent. Price of gold. , 102 lOJ ,. 10-1 1.-6 116 . 115 lm l.so 11 1862. March bonus. 90 91 99 W , 86 87 84 ' 7 i 78 7 7 0 7 , 8 T2 73 80 81 7 74 73 70 9 . 3 7 I . t2 51 42 41 47 1 41 ii April -..-.. May ........... June July August....... Me piember October ...... November. December.. ls&i. JDUry February.... March w A prll My ............ Juiie ......... .132 144 ltil .151 ,1M .148 144 .131 July AUgDHt Hpteinber. October November. December-, IIMi. January. February March , April .......... May ...... Juue .....mm. July UKUst Beptember , October November. December.., ......12 .1. ..146 U7 153 .. 154 ltf) ..1'4 75 10 2Ö0 . .4-4 .228

As Newcomb wrote his essay in the spring

V v.- WW - MKM V . 4-a w HUV VAC lV of his writing. Only the last two columns show the actual gold value, at which govern rkf 1 Än tVta aKnvA f qKIa i a anvan Vi a 1aia ment notes and bonds were held, and are worthy of attention. Newcomb says, rela tive to this exhibit "Whatever may be now said about the demonetization of gold, and its conversion into an article of merchandise, the following facts are thoroughly understood by the mercantile community: 1. Gold and silver have for centuries been the standard of value in every civilized country. "2. Gold and silver now are the standard of value in our own, as well as in every civilized country, in spite of the legal tender pa per. "3. Gold will be the standard of value in this and every other civilized country, in spite of anything any government can do to prevent it." lie rails to perceive, tnoucjti, that goia and silver are tue standard of value between modern nations, as they were formerly so between individuals, because, like diamonds, pearls and precious stones, they have an in trinsic value, based upon their utuity and rarity. The cost of gold is doubtless the chief cause of its value, for its specific ' gravity makes it more difficult to mine it than any other mineral. That is, nature's laboratory turns oat min erals for the use of man in such a mixture as to cause gold to be of greater specific gravity than any other that possesses the same power to resist acids, and that is also ductile and malleable. Hence gold, silver, copper, nickel, etc.. have been made use of as currency, or standard of credit, by all governments of modern times, whose coinage, however, has been of different fineness and weight. For instance, the pound sterling of the English government from the Norman Conquest un til the reign of Edward 111. contained a pound of silver. From that time until Edward VI. there was an almost continual de gradation of the standard. The House of Stuarts, in Scotland, in a century and a half reduced the quantity of silver in a pound to less than one-twentieth of its original amount. . When Newcomb says gold and silver are the standard of value, he means the legal standard. The laws of nations dif fer as to the leeal standard of gold and silver coins. Hence the value of all coins is regulated by supply and de mand. For instance the British legal standard sovereign pound sterling has an intrinsic value of $4 8G.GG; its commercial value vanes according to the demand, like mer chandise; $1.84 is the value of the sovereign at our custom bouses for duties. lut the par value of the pound sterling in the Uni ted btates is f 4.41 4-y. ihe par value ot the pound in London, in American coin, is $4.80. Then the difference of exchange is another value. Here are five different val ues that all foreign coins are subject to in each nation, as the British sovereign is in ours. Why is this ainerencer Bimply be cause the mint standard of fineness, or alloy. in all nations is not the same. The standard of British gold coin is fl-12 in fineness. Our gold dollar is 9 10 in fineness. A troy ounce of pure gold will produce in the British mint 1 100 410, which equals 84 21-2 still lings, or 1,019 5-11 pence. The American gold dollar weighs 25 4 5 troy grains, and contains 2s 11-50 troy grains of pure gold. VALUE OF SILVER. An ounce, troy, of silver of the British mint standard, 37 40 or .925-1000 In fineness, is worth 5S 98-008 pence, or about $1.19-73. But the silver dollar coined by the United States is, or was, 416 standard, and contained 371 grains of pure silver, worth about $0.923-79 according to the standard of the British mint And according to that stand ard our fractional silver coin is of less value than that of Canada, where an American 50 cent piece is worth 24 cents less than the Canadian 50 cent coin. Thus it is practically evident that gold and silver are the national medium of exchange between nations, while paper is or mav be the leeal money of each nation as well as gold and silver, the buying power of which, outside of said - nation, de pends upon the credit of that nation. Hence, if gold and silver are scarce, each nation can resort to the use of paper as a standard of credit But if more paper is put into circu lation than the business of tne people re quires then that paper money will depreciate in value accordingly. But there is no business so great as that of a nation that is working every fibre of its form to maintain and preserve its life. The United States gov' eminent Was in that position dttring the Tate war when paper was made. a legal tender, Such a war made a business so stupendous as to require ten times the amount of circu lation ordinarily demanded. - This fact Mr, Newcomb recognizes. He has said, "Making the notes a. legal tender, adds nothing to their value. Although congress can declare notes a legal tender it can not tlx the price of pro Visums."- But he shows in page 31 that the faith of a patriotic farmer in the paper money which his government issues to prosecute such a war as the last may prompt him to so act as to aisturo tne reia tion existing between the supply and de mand of gold and silver coin, which are gov erned and depend upon public opinion. 'Suppose, says he. "that an Ohio farmer. who never heard of a stock board or the premium on gold, has received a hundred dollars in legal tender notes for his wheat He knows that the same wheat would have brought him only forty dollars in gold. If he is disposed to set a higher value on this money he has received than others he will be inclined to sell more wheat and to spend the least possible amount of the legal tender notes in buying goods at such nigh prices, and bo will either keep the money or invest it in government bonds. Ihe increased amount of wheat he has thrown u Don the market will then cause the price to fall, and bis refusal to buy the usual amount oi goods will dimmish the demand lor them, both effects being caused by the farmer's increased appreciation of legal tender notes. This fall in wheat will stimulate an increased export . ........ . . of that article, while the diminished de mand for dry goods will cause a diminished importation. Hence the importer will want less gold for foreign export, and the price of cold will also fail." Thus me senti rnents of the Ohio farmer are reflected in the rold market. The influence of one f&rmer represents that of thousands. Regarding the 5-20 bonds and the mode by which thew were ' procured by the present holders, Newcomb savs: "The idea that any one who Utes legal tenders to me united Btates treasury and exchanges it for a bond iends to the government, is preposterous. The man who at the beginning of the war gave the government gold, or its equivalent, and the man who now (during the war) ells the provisions and munition the gov ernment requires to combat the foe, and re ceives therefor notes promising that the 'United States will pay,' these are the men who loan to the government, tne debt was contracted when the provisions, monitions, etc, were received and the notes issued, and the same debt can not be contracted twice. The man who brings the notes to exchange

or a bond only changes the form of the

debt, greatly to the disadvantage of the government, because the latter has then to pay interest equivalent to 10 or 15 percent on the market value of the debt" SOT CONVERTIBLE BOXDS. He refers to the notes first issued that were convertible into bonds. The notes isued in 1805 were not so . convertible. eing simply receivable lor all loan?. But as these loans." savs Sewcombi "arenegotiated only on such terms as the government chooses to grant, this adds but little to the value of the notes. The first notes being redeemable in bonds their value could not fall below that of bonds for which they were exchangeable. Eut how was the value of the 5-2 bonds fixed? By the terms of the leeal tender act the government could redeem the bonos at ary time after five rears in leeal tender notes. The value of the 5-20 bond was therefore fixed by the value of the future legal tender notes, which might be less than that of the present ones. There was no promise, expressed or implied, that the money with which the principal of the 5-20 bonds should be discharged should have anv intrinsic value whatever." The above is from page7. On page 81 he says: "Herein lies the sole economical advantage of a nublie debt. It enables that portion of the com munity which is in the ereatest want of cap ital to keep possession of what they have, or to add to it by paying the government the annual interest on the money they would actually owe to it should the eovernment levy a war tax instead of borrowing money to support and equip troops. etc." Having asserted this, he eives an in stance: "When a special war tax is assessed, it may happen that the, workmen who are not frngal, can not pay their entire assessment during the year, and can not enter the government service with serious incon venience to their families. It may also hap pen that the business man is employing his capital so profitably, or all that he has is so necessary-to his business that his profits will be materially curtailed by the loss of what ne would pay as a war tax. Or a farmer who would be assessed $100 war tax might need all the money he could raise to buy implements and to pay his laborers. If he wert permitted to apply his assessment this way he could raise $10 worth additional of wheat He may then apply to the capi talist who can not only pay his own war tax but the farmer's also, to loan him the money at six per cent, interest, and thus make a bargain, as could the workman or merch ant, also, that would be mutually advan tageous. , ilut the capitalist may not be wil ling to trust the farmer, or workman, or merchant Here the government steps in and borrows the $100 from the capitalist, trusting to gradually obtain the principal and interest of the sum borrowed from the farmer in the form of taxes. The national debt thus incurred is beneficial to the farmer and others, who can lay out his $100 assessment on his farm, on condi tion of paying the government the annual ; interest on that sum. So long as the government can borrow on such favorable terms that it would be to the advantage of tax-payers generally to borrow on the same terms, so long is the fmblic debt a public advantage and no onger. The great political question now is: Does our government borrow money on such terms? Let us see: A five percent, bond, interest payable in gold, can now (1805) be sold in the market for par in currency; but one dollar of this currency is worth little ia ire than 40 cents in gold, so that we are really paying 12 per cent interest on the actual amount we bor row. Is this to our advantage? The taxpayers will think so. Then the government should not incur any further debt for in doing so it is as the agent of the tax-payers borrowing for them on exorbitant terms." And on page 84 he says: "The increase of the public debt by selling bonds for 40 cents on the dollar produces an une?ual distribution of the burdens of the wax. f the principal and . interest of the debt is ever paid in gold, then the bondholders will be profited at the expense of the tax-payers, who will have to pay just double their right share. If they are paid in paper it will make a complete lottery out of tne entire debt" His conclusion is: "Every consideration of sound policy demands a stop to the further increase of our debt, and the levy of a war tax sufficient to meet all the further expenses of the war." Then he makes this pertinent query on the same page (80): "Ought the public debt to be subject to taxation r' The answer is: "There is no reason why. 'the owner of a government bond should not pay the same tax on it as on other property of the same kind. The man who lends money to the government does not thereby resign either the real . owner ship or the benefits of the money, for it is all to be returned to him; he ought therefore to pay the same taxes on it that he would have paid if he had kept it for his own use. If he lent his entire property to the govern ment, when the debt was discharged he would get it all bark again without having paid any tax at all, unless his bond was taxed. , 'When the povernment sells bonds with a pledge that they shall cot be taxed, in order to get more for them, it amounts to selling out in advance all the taxes to which the bonds migh in common with all other personal property, become subject This 'farming out' ot taxes to be collected for that is what the contract amounts to is the worst possible way of borrowing money." The result will be, he fully demonstrates, that the bonded debt "will leave those sections where agricultural, manufacturing and mining capital is scarce, and accumulate in those sec-, tions where it is plenty. The debt held in the west will flow east in exchange for agricultural implements, machinery, and the products of looms and anvils. Or, which amounts to the same thing, it will come east in exchange for manufactured articles on which the western man will subsist while they are erecting barns, houses, mills and factories, or digging mines, improving farms, constructing roads, which are to be the future sources of their wealth. In the east where all the mills, factories, etc., are already built, and engaged in active competition with each other; where, therefore, the rate of interest and profit on capital U lower, the bonds will be relatively more valuable, for the same reason that three per cent con ols are worth twice as much in England as they would be in this country. "Thus in a very few years, four-fifths of our debt will almost certainly be held in the Atlantic states, while more than half the taxes will have to be paid by the states which own the other fifth." T.O.H. The Lancet of June 2 protests against the practice of administering hydrate of chloral and other so-called hypnotics to lunatics for the purpose of producing quietnes. as tl means of "chemical restraint"--hyarate if chloral and all narcotic drum induce a condition of the brain similar to the orgati o changes which cause permanent denien'. a tad hinder cure.

GOLD IN THE BLACK HILLS.

A' Description of the - Country Who Are There. and Some Ciold, bat Jlore Men WnaSTney Do When They Go There. Special Correspoodence of the Sentln tl'. Dkadwood, D. T., June 14. Since writing ray last to you we have had quite an addition to our city from Indiana, more particularly from Indianapolis; namely, J. W. foons, ex-city treasurer; O. Frink, Or. Coek, K Hammell, Tom Kirby, John Gallivan, and on yesterday Mora and Dillon. Most' all of the Indiana boys are satisfied to stay and "prospect" a little while longer, believing that in due time they will strike ("oil")' goid. It is settled beyond dispute that gold abounds in all the hills and gulches in and around Deadwood, but as I said before, it takes an immense amount of labor, patience and gold to get it out Thousands of men arrive- and depart from this neighborhood everyday. Those who come and stay a day or tw or just long enongh to eat the last morsel of grub they mav have, and who, instead of taking pick and shovel and going to the hills and gulches and prospecting, or even shaking an attempt vo aiscover goia or sees worx, these men, and such as these, leave the country disgusted, and to every one they meet on tne roaa to ueaawood thev say: "Don t go any further; turn back. There is no gold at Deadwood ana there never was." Yet these men did nothing while they were here except visit the saloons and gambling houses, of which this town, God knows, has got her share. Goid abounds here in every hill and gulch, but whether in paying quantities to warrant a Dig outly in mills and machinery, it is too early for any man to say with truthfulness. THE DIFFERENT MIXES. The mines at Lead City, Golden Gate, Gay City, Hidden Treasure, Galena and one or two other cities (the names I can't just now call) are working to their full capacity. The quarts mines are yielding from$2,000 to $13,000 every clean up, which is about a six days' run. That they are making that much is true, and how much more you can't tell, as men here, who are making the money, are rather reticent about their "private business." The quartz gold here runs every way not, I am told, like California. Some of the mines have, heavy tunneling; others drifting, and just as frequent surface cr very shallow drifting. Stamp mills and machinery are arriving by every ox or mule train, and I dare say that inside of 90 days not less than 100 mills will be in operation. Now, parties not knowing would think, why surely this is the place for the laborer to go. Ah! my Indianapolis friends, if the labor were to come only from our city, then you all could come; but, don't forget it, that we have people from "every nook and corner on the globe, and thousands are on our streets and at our mines seeking work. WHO SUCCEED. Old experienced gold and silver miners succeed in getting work, at say from $5 to $3 per day. Some of our poor Indianapolis laborers would say, "Gosh! - If I could only get the half of that I'd be satisfied." But stop; let us see what it costs to get that always look before you leap. It will cost first class passage, including board, about $57 to get here; then three or four days after you are here to look around, and now comes the "grub." PRICK OF PROVISIONS. To-day provisions are lower than at any time since I've been at the Hills, and still flour is $18 per cwt; bacon 23c. per lb.; coffee 00c, per lb.; tea $1.75 to $3.10 per lb.; sugar 2Sc. per lb. ; molas jes $2.25 per gallon, and whisky (said to be very poor) 25c. per drink. Now let some of ray old army friends multiply the prices of those articles by the "ration" and see out of their wages how much 'they will have left And nere is another very costly article, "your health;" for what man can lie on the ground night after night nearly frozen? The nights here in June are as cold as they are at home in December.- Yesterday we had three inches of snow, and on Sunday last the hail was so. large that it knocked down horses. All these woes and ills of life a man must bear in a mining country. As for merchandising, there is no article of merchandise you can not get here, but at a considerable advance over Indianapolis prices. In short, every department is over done. OAMBLI.NO HOr8E AND SALOONS predominate. Gambling goes on all day , 'and night I've seen men sell their blank ets on the street on the representation that they wanted bread, yet in five minutes you would see these same fellows "bucking the tiger." Nearly everybody seems to have a mania for gambling.. We have two VAEIKTT THEATERS here, and the old attaches of the "Met" are well represented. Miss Fanny Bean and her father, Miss Le Roy (who got married so the papers say yesterday). Miss Frankie Lee and two others whose names I can't just now call. Last week we had what they call a stampede from here to the "Big Horn" country and th Powder river country. Gold is said to have been discovered there in "chunks" as large as the bumps of benevolence in some of our rich Indianapolis friends' beads. Old California miners shake their heads at those who go, and say "they will go to the Big Horn, but will come out at the Little Horn." DOS'! COME. .In conclusion let me say through your columns in answer to the many letters that I am constantly receiving in reference to this country, don't come now; wait another year, and then the mines will have been developed, and if there is gold in sufficient Suantities to pay for opening and mining, iers will be plenty left for you to open. If you have plenty of cash, and are willing to try your luck In this grand lottery, come, and come via I., B. and V. C, B. and Q., V. V. It. R, to 8idnev, Nebraska, then stae it over. 1 may pay Indianapolis a visit this winter, and at that time will be pleased to give a more full history; but for the present I'll remain here, as I am here, and think I can't do better at Indianapolis. All Indianapolis boys, without any exception, ane bodily (but I can't say mentally) well. Yours, etc, IL 8. B. Away out in Wisconsin they are claiming the honors of the construction of delicate optical instruments. Mr. Richard G. Norton has finished a polariscope, said to be good in every respect The Madison State Journal claims that this is the first polariscope ever toAdflla America.