The Congressional Globe, Volume 13, Part 2: Twenty-Eighth Congress, First Session Page: 9

Dec. 1843.
APPENDIX TO THE CONGRESSIONAL GLOBE.
9
28th Cong 1st Sess.
Report of the Secretary of the Treasury,
Senate and H. of Reps.
means are collected and deposited, and to give notice
of such determination by an endorsement upon the
notes. It was doubted "whether tie bonds Required
by lav/ to be given by collectors, or any other offi-
ueis, would extend to a responsibility for funds that
might be placed in their hands to mak*"1 such pur-
chases; and lience it was deemed impracticable to
employ them for that purpose, if it had otherwise
be-en considered expedient.
The notes are made payable in one year, rather in
conformity to the construction heretofore given to
the act of 1837, than from a conuotiem of iis being
required by that act. The object of the second sec-
tion seems to be to prevent th<--m from running or
bearing interest longer than a year, h ia sih-m re-
specting any short* r period, app.n ently with the view
of leaving souic discretion. The notice that they
\\ ill be purchased is endorsed on them, distinct from
the body of the notes; so that, if any extraordinary
emergency should occur to produce any difrhulty in
their purchase, or for any other reason it should be
dtemed expedient, the endorsement maybe omitted,
and the notes permited to circulate without interest,
or they may be altered to specify a rate. They are
not only receivable for all public dues, but may be
exchanged for specie at par, at the custom-houses
and land offices, to the amount of one half the com
they may icspectively have on hand. Less than
two hundred and seventy thousand do1 Las of the
new notes ha"\ e been hsued.
The effort had been made by a former Secretary
to substitute notes with nominal rates of interest,
and also notes with the low rate of two per cent.;
but it had not succeeded, in consequence of their not
being convertible into coin on demand. For, as the
present value of a post note is diminished m exact
proportion to the time it has to rim before maturity,
a discount upon it fan only be prevented by allow-
ing interest equivalent to that time. The question
of convertibility, therefore, was in truth a question
whether interest should or should not be saved, as
the permitting the notes to be at a discount was not
to be tolerated.
No apprehension was or is entertained of the per-
fect ability of the depe/;mmt to purchase ail that
may be presented for the purpose. There is, and
always must be, a surah,s m the Treasury beyond
the immediate fills upon it. This, with a revenue
more than three times the amount of the notes con-
stantly accruing, would be adequate, as us place
could always be supplied with otli^r notes, with or
without interest, as circumstanccs required, with
which a portion of the public expenditures could be
made. In the possible cvfi.t of a large accumula-
tion, treasury notes bearing such interest as would
ensure loans, not exceeding the prescribed r,Ue, or a
resort to the authority to issue a stock, would either
of them be sufficient to provide the necessary funds
to meet such accumulation.
The exigencies of the treasury demanded that the
effort should be made to relieve it from such n
weight of imprest, especially as it would not pre-
clude a return to the system which invites banks to
hoard treasury notes, "by allowmyr them an interest,
while they borrow of the community without inter-
est to the extent of their circulation.
The authority given by the Constitution to "bor-
row money on the credit of the Lm'ed States,'1 in
its Tfnn^ comprehends every form of loon which
Congies? may think proper to prescube; and it is
not eii^y to porcfice how this express and unquali-
fied .Trnnt of novo- can helimued or curtailed. Cer-
tain ix is, that the moc-t distinguished among those
• 'i-o contend for a strict eonsnueiion of the Consti-
tution haveguen their sanction to the existence of
this power in the form oi bills of credit or treasury
notes.
Well-founded objections exist to borrowing with-
out an urgent necessity, m tne form either of perma-
nent loans, or those of a temporary charaeu-r. That
nectmust also influence ihf terms and condi-
tions of'othtr mode. The foimer, by pntung oif
the dav of payment io tla more eonveme.u season,1'
removes the most etVetual check to prodi :.dity, and
offers a temptation oi diflhuh rrsistance. li has ac-
cordingly proved thebatii of ail governments, S.he
policy of the trea.auy-note Ny^em seems to Ime
been devised to guard n^amst unx evil, by bringing
the day of payment close upon thai of expenditure;
and it would seem that the more immediate the lia-
bility to pay, the more ^ ould thai policy be pro-
moted. A postponement, even for a year, invite* to
profusion; and no check can he ^o effectual as instant
responsibility. Kvery loan thus made directly h om
the people, is in fact mad*, not in consideration of
the interest agreed to be paid by the Government,
but literally and solely upon "the credit of the
United States."
It, after such notes have answered the purpose of
Government in promoting convenience, security, and
economy in the public disbursements, they should,
in consequence of their uniform value, be kept in
circulation to any considerable extent by onrfcllow-
citizens for their own convenience in maintaining in-
ternal trade and keeping: down the fluctuations of
exchange between different parts of the country,
arising "from a disordered currency, it is not perceiv-
ed how such a result affords ground for objection to
a system constitutional in itself, and adopted for
legitimate and constitutional objects, Ii is submit-
ted that the Government, is responsible, only for the
use which it makes of the pow^r to incur a debt, and
not for the use or abuse by the people of the evi-
dences of that debt which it may issue. Their ap-
plication by the community to the purpose mention-
ed, is a proof that they are wanted for that purpose,
and that "the ciedit of the United States1' has taken
the place of local, chartered, or State credit. Those
who object to such a consequence in the present state
of our finances, which require a loan in some form,
must, hov.ever, choose between the evils of that re-
sult (if thfy are evils) and the penis of n permanent
national debt, which must either he created direetlv,
or must follow at no remote period, and tabe up
securities which may be issued m the form of a pro-
tracted promise to pay. For m this, as in other
ca&es, we are not allowed the use of means enthvly
free from objection, but are compelled to select, be-
tween different modes, that which is the least objec-
tionable.
At all events, the small amnio it of convertible
treasury notes that may be issucdunder existing- laws
(less than one-third of the annual receipts, and kss
than one-fourth of the mmikd public expenditure^)
cannot create anyvciy dangerous Cfp,-n >er c^rrr-nov-'*'
And it is supposed that the objections referred to
are not so much the issue of sreh an amount as a
temp^ary ev^odlent, but are founded vmbpv
an apprehension that these notes wm be usernl
to the Government, and so benrfc'al *o the poenV,
that their issue may hereafter be carried to excess.
It is a fair question whether the dancer of excess in
this mode of borrowing money equal to thai ari-
sing from bans upon deferred times of paymeMt:
While the wisdom and fn-mness of Omgrerc ou'-ht
not to be distrusted m eitVr chsc, yet it is wrnthy of
observation that the mode winch requires immediate
liability to nay, furnishes a <iuard in itself ngnmsr
abuse, by the instant and infallible check which :t
furnishes upon issues beyond the means of convert-
ing into coin.
A brief synopsis of the foregoing statements and
suggestions in relation to the deficiency of means to
meet the ordinary expenses of Government during
the current and the next fiscal year may be u^nh
By extending the loan which becomes elu.e 1st Janu-
ary, 1845, its amount (^5,672,9^ 0 SSN> ma*, be provi-
ded for.
By raisins oflight--moncv, bv a duty on articles
now free, (particularly tea and couee,; and bv the
other means suggested m this report, an addition
may be made to the revenue of between four and five
millions of dollars. Estimating; this at four million
five hundred thousand dollars, there will be left to be
provided for four million live hundred thousand
dollars, and the outstanding treasury notes, anvunt-
insr to a little more than tour mfhon six hund/ed
thousand dollars. These two items, amounting in
the whole to nine rmlliou one hundred thousand
dc-lkus, might be supplied by a continuation o+" thp
act of March 3, 1843, (providing for the re-is?ue of
treasury note?:, with a contingent authority to fend
into a .-tock,) which is limited to the 1st of July,
1844: and, by extending u so as to include the anti-
cipated deficiency of four million live hundred
thousand dollars, or such portion of it as it mav he
found expedient to meet m this nunner. liy ihu-, an
increase ofthe permanent public debt may be avoid-
ed: and any reduction of expenditures or increase of
revenue (hat may take place, v. ill rnvV.de ih~ dcp\f{-
ment to redeem a portion of r'nr floating debt. For
the-reason, if for no other, u u: ad\isable ihat this
poition of our debt shook! be kept (n such a condi-
tion that it may be redeemed at pleasure. Should
the discretion as to the rate of interest on the treasu-
ry notes-to be issued, be abrogated, or should the
authority to purchase them on presentation be with-
held, (winch would be equivalent to a do eetion that
interest shall be paid at all events,) then it will he
necessary to add to the estimated deficiency for the
service of the next fiscal year at least four hundred
and fifty thousand dollars.
There are some subjects to which it seems a duty
to invite the attention of Congress, before closing
this report.
To prevent illegal importations on our southwest-
ern frontier, as well as to afford the proper facilities
to traders who may wish to bring- merchandise in
that direction, it would be advisable that a port of
entry should be established in that quarter. The
town of Independence, hi Missouri, has been sug-
gested as a good position.
By the existing law, an appeal to the Supreme
court cannot be made from the decision of a circuit
court in cases involving the amount of duty that
may be levied on imported merchandise; because the
amount in controversy in the particular case never
exce eds the prescribed limit. The courtesy of the
judges sometimes induces them to disagree in form,
in order to obtain the opinion of the Supreme
Court. But it frequently happens that only .one
judge holds the court; and it would seem that the
Government ought not to be indebted to the courtesy
of any officcr for the opportunity of correcting what
may be an erroneous construction of its revenue laws.
The principle which prescribes a limitation of the
value of the subject in controversey in civil suits to
entitle a party to an appeal, is believed not to be ap-
plicable to questions of revenue, when the decision
of a particular cpsc may, and often does, involve hun-
dreds of thousands of dollars; and it is submitted that
in all such cases the United States should have the
ri'iht of appeal, of course, but that the costs conse-
quent upon such a proceeding should not in any
event be charged upon the opposite party.
A practice has prevailed of allowing the compen-
sation of clerks employed m the custom-houses
to be paid out ofthe revenue, in cases where the fees
were not deemed adequate to obtain the necessary
numhe". Believing this practice unwarranted by
law. and being confirmed in that view by the opin-
ion of the Attorney General, it has been abolished.
The/e are probably cases, 'however, where legisla-
tive pr ivision v.'i'i be necessary to procure the prop-
fT to the collectors and naval officers.
The provision for the relief of sick and disabled
fieam^ti' is, <md for years has been, wholly inade-
a,i ue to it-, purpose Seamen, being from their pur-
«;\i {- v-uoh*- unable to shore in the general pro-
vision for the destitute, and having contributed to
this fund whet the law demands, claim its benefits,
wnhout knowing or refenng to its amount, or to the
lea:ol restraints iro<m those charged with its admin-
istration. Ail cnbrts to prevent the expenditure ex-
ceeding the means provided have heretofore been
unavailing, and there is constantly a balance against
the fund, which is supplied by appropriations from
the treasury. To increase tlie amount demanded
fr< m them'would be odious, if not onerous. By
the act of March 1, 1843, the laws requiring con-
tributions to this fund are extended to the earners
of registered vessels. It is submitted whether this
prinep->la might not with great propriety be still
further extended to the owners of all vessels, in the
form of either monthly 01* yearly contributions,
graduated by the tonnage of tiiis vessel. This pro-
vision, with "that already suggested of appropriating
to the same purpose the discriminating tonnage duty,
would probably iurnish the relief which humanity
as well as polity dictates should be extended to a
class of men proverbially improvident, but yet iden-
tified. with the power and property of the country.
The condition of the marine "preventive service
asemst smuggling has been materially improved,
while a wholesome economy has been preserved.
It will be the subject of a special report.
The light-house establishment will also be the
sul >ject of a future communication to Congress. Re-
poiK from the Commissioner of the Land Offico,
aud from the Solicitor of the Treasury, respecting
suits and prosecutions in behalf of the Government,
v, ill also be submitted.
It affords great pleasure to Mate there has been no
delinquency or default 011 the part of collectors of
the customs, the receivers of public moneys, or any
other officer or ace-a, charged with the receipt or
deposite ofthe public funds. The sums which col-
lectors and receivers are permitted to retain in their
hands have been limited to the very lowest amount
the public service would allow, while they have
been required to deposlte the surplus immediately in
the institutions designated for that purpose.
A rigid adherence to these regulations is maintain*
ed by means of a constant watchfulness of their ac-
counts. A list of the depositories sel«ctp4 by thf