People's Pilot, Volume 3, Number 28, Rensselaer, Jasper County, 29 December 1893 — A BELATED REPORT. [ARTICLE]

A BELATED REPORT.

Bocrotary Carlisle Tell 3 ol® the Treasury’s Needs. g He Recommends a New Issue of Ronds, a Tax on Legacies and Incomes, and an Increased Tax on Spirits. OTHER RECOMMENDATIONS. Washington, Dec. 22. —The annua, report of Hon. John G. Carlisle, secretary of the treasury, was transmitted to congress Wednesday. Tlte secretary estimates the revenues of the government for the fiscal year which will end on the 30th of next June at $430,121,UU3, and that the expenditures for the same period will amount to 1458,121,000, leaving a deficit of $28,000.003 on ihe year. He mentions that there are Pacific railroad bonds, known as “currency sixes,” issued In aid of tho Pacific railroads, falling due within the year 1834, to the amount of $2,362,000, which must be paid, at maturity, and recommends that congress lake action at this session to provide for them. He suggests as a means of enabling the government to promptly meet the emergency, and provide a larger reserve fund several courses of action One is the issue of 3 per cent five year bonds, in small amounts, to be disposed of through the sub-treasuries and post offices to our own people. Another, the issue of fifty million dollars in one-year, 3 per cent bonds at par. Until the effect of the repeal of the Sherman silver purchase law is more fully developed he does not consider it advisable to recommend further specific legislation on that subject He favors legislation to authorize a more extended use of stiver certificates. He refers to the ©pinion of his predecessor and of the late attorney genera! that the gain or seigniorage resulting from the coinage of the silver bullion as it progresses constitutes a part of the general assets of the treasury, and states that he has ordered the mints at New Orleans and Sa.x Francisco to be kept in readiness to commence the coinage of standard silver dollars at any time when required. He champions tho system of substituting ad valorem duties tor specific duties in tho collection of customs, aud recommends an increase of ten cents a gallon in the internal revenue tax on distilled spirits; the imposition of additional internal revenue taxes on cigars stnd cigarettes, the imposition of new taxes on playing cards, cosmetics, perfumeries, legacies and successions, and incomes derived from investment in stocks and bonds of corporations ami joint stock < ompanics. In speaking of the possible i3.sue of bonds the secretary says: “In the present condition of the public credit nothing less than the existence of a great and pressing financial emergency would, in my oniuion. justify the issue and .sale of any of these classes of bonds. ‘•lf the authority now existing snoutd be so modified as to empower the secretary of the treasury to issue the bonds in denominations or sums of 325 and its multiples they could be readily disposed of through the sub-treasuries and post offices w ithout the agency or intervention of banks or other financial institutions and without the payment of commissions Such bonds would afford to Ihe people at large an opportunity to convert their surplus earnings into a form of security, which, while it would be perfectly safe, would not only increase in value by reason of accumulating Interest, but be at all limes available as the means of procuring money when needed, and the experience of this and other countries justifies the confident belief that such a p.au uould be popular aud successful. Con■gress afoue has the power to adopt such measures as will relieve the present situation and enable the treasury to continue the punctual payment of all legitimate demands upon it, and I respectfully but earnestly urge that immediate attention be given to the subject.” Secretary Carlisle sayS’- that at the date of the resumption of specie payments, January 1, ISTa. there were of the old legal tender notes to be redeemed, and the secretary of the treasury considered that $103,003,000 would constitute a sufficient basis for the maintenance of that amount of currency at par. Hut since July 14, 1830, auditional treasury notes have been issued to the amount of 5155.033.U40, of which there are tow outstanding $158,318,224, making the government obligations in currency $499,909” SMt In addition, he says that there nave been coined under authority of the law $413,332,550 in legal lender silver, upon which certificates have beeu issued, to the amount of $334 138,504. "With reference to this matter the secretary says:

“Under these circumstances it is, in my opinion, necessary not only that the secretary should be clothed with full authority to procure and maintain an ample reserve in coin, but Ibat the purposes for which such reserve is to be held aud used should be made ns comprehensive as the duty imposed ujxm him by the law. The existence of Buch authority in a constantly available form would of itself inspire such confidence in thj security and stabiliiy of our currency that its actual exercise might never become necessary, but the futility of declaring a specific policy and withholding the means which may become necessary for ns execution, is too apparent to require comment.” After detailing the recent efforts of tho treasury department to maintain the hundred million dollars reserve, he continues: “So long as the government continues the unwise policy of keeping its own notes outstanding to circulate as currency, aud underiakes to provide for ilieir redemption in coin on presentation, it will be, in my opinion, essential for the •secretary of the treasury to possess the means, ■or to have the clear und undoubted authority to secure the means which may from time to time become necessary to enable him to meet such emergencies as the one which has recently occurred in our financial affairs.” The secretary says that the amount of money lu the country outside of the treasury oil Dccom* -ber I, 1c93, was $112,434,047 greater than the Mount outstanding on November 1, !532, und insist* that it is greater than is required for the transaction of the business of the people at tbm time This is conclusively shown, he says, by the tact that the money has accumulated! uud is still accumulating, in the financial centers to such au extent as to constitute a. serious embarrassment to the banks in which it is deposited. The secretary Bays that the money does not create business but business creates a demand for money, and until there is such a revival of industry and trade as to require the use of the circulating ■medium-now outstanding, it would be hazardous to arbitrarily increase its volume by law, or to make material changes in its character by disturbing in any manuer the relations which its different forms now bear to each other. .secretary Carlisle says that one of the principal difficulties etieouutered by the treasury -department results from the indisposition at the public to retain standard silver dollars and Bilver certificates in circulation. The secretary dqes not know why this should be, and adds; *• “With the policy of maintaining equality in the exchangeable value of all our currency firmly established and the further accumulation of silver bullion arrested, there is no substantial reason why the silver certificate .should not be favorably received and as liberally treated by the public as any other Sana of note in circulation, and for The purpose of creating a greater demand for their permanent use iu the daily transactions of the people, I have directed that, as tar as ihe law permits, and as rapidly as the opportunity is afforded, the amount of such certificates of denominations less than $lO ahull be increased by submitting them for larger ones to be retired and that the small denominations of other kinds of currency shall be retired as they are retired into the treasury -an 1 larger ones substituted in their places. J am of the opinion that if this policy can be ■carried out to the extent of supplying the country with small silver certificates to an aptouut sufficient to conduct ordinary cash transactions of the people, and if, during the aatne t.rne, certificates of the largest denomiuatfohs were issued in the;plaees of others retired, so as to encourage ti.o national banks to told them as parts of their lawful reserves, the existing difficulties would be removed, and ultimately a larger amount of such eurrenov than is now in circulation could be conveniently and «uie<y used.

‘•in order that the department might be in a Condition to comply promptly with any increased demand there may be made upon it by Che public for sfcaudard silver dollars or silver certificates, or that it might take advantage of car favorable opportunity that may occur to put an additional amount of such currency in -circulation without unduly disturbing the monelary situation, I have caused a large amount of bullion to be prepared for coiuaee at New Orleans and San Franeisco, and have ordered the minis at those places to be in readiness to commence operations at any time when repaired. ” ITiie secretary then submits some suggestions ■upon the general principles involved in the proposed revision of the tarifT laws and says that the only proper purpose for which taxes can bo levied and collected is to raise revenue for the support of the public service end the payment of public obligations 'This should be collected with the least cowl hie injury to any part of the people but without regard to the groundless apprehensions or unreasonable opposition of timid or •elfish interests. He declared that nothing but Oho plainest necessity can justify the imposi'tton of specific or compound rates of duty in any case. He says that taxation according to 'Value is distinctly American and does injustice 4q no one. V.t. Carlisle Is in favor of cheapening the nec-CBs-tr.xs of life for the masses oi the people and

taxing luxuries and articles of taste an« fashion to the highest point In alluding to the raw materials, he says: If the world's store of raw materials were as accessible to the American workingman as it is to his competitor in other manufacturing countries his superior skill, sobriety and industrial habits would enable him. without financial aid, to supply many parts of the world where his products are now never seen with machinery, implements and various kinds of textile fabrics of such qualities and at such prices as would exclude all competition and create a demand for a large increase of our productive forces. With free raw material as a permanent fixture of our revenue legislation the demand for labor would steadily grow with the extension of trade, wbils enlarged opportunity for the profitable investment of capital would stimulate the spirit of enterprise among our people and greatly diminish the danger of periodical suspensions, lockouts and strikes, which have In recent years so seriously interrupted our industrial progress. The secretary then comes down to the revenue and the means of raising it and says: “It is estimated that the revenue for the fiscal year 1895 will amount, upon the basis of existing laws, to $454,427,748, and that the expenditures, excluding the sinking fund, will amount to $448,353,789. The estimated revenue from customs is $193,003,000, and the total estimated receipts from all sources will exceed the estimate of expenditures $0,123,958. Assuming these amounts to be approximately correct, it will be necessary in any changes that may be made in our revenue laws to provide for raising about $184,303,000 from customs alone, or partly from customs and partly trom such other subjects of taxation as congress may see proper to include in our internal revenue system. lam of the opinion that an increase of $50,000,000 to the revenue for the fiscal year 1804 by the imposition of additional taxes under tho internal revenue system will supply sufficient means for the support of the government “I have reached the conclusion that it can bo mostconvemently and justly raised by increasing the tax on distilled spirits 10 cents per gallon, and by additional taxes on cigars and cigarettes, and the imposition of new taxes on playing cards, cosmetics and perfumeries, legacies and successions, and incomes derived from investments in stocks and bonds of corporations and joint stock companies.” The secretary,‘after stating why distilled spirits, cigars, etc., should be taxed, says: “Taxes upon legacies- and successions and incomes acquired from investment in stocks and bonds of corporations and joiut stock companies are less objectionable in their nature and in the methods of collection than any other excises which it is competent for the United States to impose upon incomes according to their actual value or amount. They are not inquisitorial nor liable to evasion by tho fraudulent suppression of facts.because the assessment* or returns need not be based upon information extorted by the law from the persons charged with their payment, but upon the public records aud the regular ana authentic accounts of the corporations and companies in which tho iuveslments have been made: and they have the additional merit of being imposed entirely upon that part of the citizen's income v.-ffieh is not earned by his labor skill, but which in the cases of legacies and successions is acquired uy mere operation of law or by gratuitous bequest. aud in the case oi incomes from investments in corporations and joint stock companies by the simple earning capacity of his capital as such without personal effort on his part. A tax of 1 per cent, upon an income of $3,030, derived from Ihe investment of $50,U00 in a ti per cent stock would amount to S3O, a sum so insignificant that the investor could not reasonably claim that the franchises and privileges granted to his debtor had not added fully that much to his receipts." The secretary concludes his report by urging congress to practice the strictest economy in public expenditures consistent with an efficient administration of the law. He reminds the representatives that reductions of taxation cannot logically be insisted upon or fnade practically betielicial without a corresponding reduction of expenditures. On the subject of the sugar bounty the secretary simply says: . "I respectfully call attention to the various recommendations contained in the report of the commissioner of internal revenue and ask their favorable consideration by congress." in regard to the condition of affairs in the sea Islands of South Carolina, Secretary Carlisle only refers to the work done by ihu marine hospital .service and adds: "This work, purely of a sanitary nature, is to be supplanted by tiie efforts ot the lied Cross society in relieving the physical necessities of thq people.”