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The President's Veto Message

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Washington, April 22. - Thefollowing is the f uil text of the Presiden t's veto message sent to the Sonate to-day : To the Senate of the Unit3d States. Herewith I return Senate bilí No. 017, entitled " au act to fix tho aniount of United States notes and the circulation of National banks, and for other purposes," without my approval. In doing so I must expresa my regret at not beiug able to givo my assent to a measure which has received the sanction ot' a majority of the legislators chosen by tho people to make laws for their gnidance, and I have studiously ooiight to find sufficient argument to justify such assent, but unsuccessfully. Practically it is a question whother the moasure under discussion would give an additional dollar to the irrodeemable paper currency of the country or not, and whether by requiring three-fourths of the reserves to be retained by the banks, and prohibiting interest to be received on the balance, it might not prove a contraction. But the fact cannot be concoaled that the bill increases the paper circulation f 100,000,000, less only the amount cf reserves restrained from circulation by the provisions of the second soction. The moasure has been supported on the theory that it would givo an increased circulation. It is a fair inference that if, in practice, the measure should fail to croate the ubundance of circulation expected of it, the friends of the measure, particularly those out of Congress, would clamor for such an infliition as would give the expected relief. The theory, in iny belief, is a departure from the true principies of tinance, National interost, National obligations to creditors, Congressional and party pledges on the part of both political parties, and of the personal views and promises made by me in every annual message sent to Congress, and in each inaugural address. In my annual message to Congress, December, 1869, the following passages appear relating to the evils growing out of the Robellion : " And not yet referred to is that of an irredeemable currency ; it is an evil which I hope will receive your earnest attention ; it is a duty, and one of the highest duties of the Government, to secure to the citizens a medium of exohange of flxed, unvarying value. This implies a return to a specie basis, and no substituto for it eau be devised. It should be comtnenced now and reached at the earliest moment, consistent with a fair regard to the interest of the debtor class. Immediate resumption, if practicable, would not be desirable. It would compel the debtor class to pay beyond their contracts the premium on gold at the date of their purchase, and would bring bankruptcy and ruin to thoosands. Pluctuation, ho wever, in the paper value of the measure of all values, gold, is ■ detrimental to the interest of trade. It makes the man of business an involuntary gambler, for in sales where future payment is to be made both parties speculate as to what will be the value of the currency to be paid and received. I earnestly recommend to you, then, such legislation as will insuie a gradual return to specie payments and put an immediate stop to fluctuations in the value of the currency." I still adhere to the views then expressed. As early as December 4, 1865, the House of Representativos passed a resolution by a vote of 144 yeas to 6 nays, concurring in tho views of the Secretary of the Treasury m relation to the necessity of a contraction of the currency, with a view to as early a resumption of specie payments as the business interests of the country will permit, and pledging cooperativo action to this end as speedily as possible. The first act passed by tho Porty-first Congress, on the 18th day of March, 1869, was an act to strengthen the public credit of the United States, as follows : Be it enacted, etc, That, in order to remove any doubt as to the purpose of the Government to discharge all its obliga - tions to tho public creditors, and to settle conflicting questions and interpretations of the law by virtue of which such obligations have been contracted, it is hereby provided and declared that the faith of the United States is solemnly pledged to the payment, in coin or its equivalent, of all obligations of the United States, and of. all the interestbearing obligations, except in cases where the law anthorizing the issue oí acy such obligatious has expressly provided that the sum may be paid in lawful money or other currency than gold and silver ; but none of said interestbearing obiigations, not already due shall be redeemed or paüd before maturity, unless at such times as the United States notes should be convertible into coin at the option of the holder, or unless at such time bonds of the United States, bearing a lower rato of interesi than the bonds to be redeemed, can be sold at par in coin ; and the United States also solemnly pledges its faith to make provisions, at the earliest practicable period, for the redemption of Unitec States notes in coin. This act still remains as a continuing pledge of the faith of the United States to make provisión at the earliest momen for the redemption of United States notes in coin. A declaration contained in the act o June 20, 1864, created an obligation tha' the total amount of United States notes issued or to be issued, should never exceed $400,000,000. The amount in actual circulation was actually reduced to $356,000,000, at which point Congress passec the act of February 4, 1868, suspending the further reduction of the currency The $44,000,000 have ever been regarded as a reserve to be used in case of emergeney, such as has oceurred on severa occasions, and must occur when, from any cause, the revenues suddenly fall below the expenditures, and such reserve is necessary because the fractional currency amounting to $50,000,000, is redeemable in legal tenders on cali. It may be sak that such a return of fractional currency for redemption is impossible, but let step bo taken for a return to a specie basis and it will be found that silver will take the place of fraotional currency as rapid ly as it can be supplied. When tho premium on gold reaches a sufficiently low point, with the amoun of United States notes to be issued per manently within proper limits, and the Treasury so strengthened as to be able to redeem them in coin on detnand, it then will be safe to inaugúrate a system o free banking, with such provisions as to make compulsory the redemption of the eirculating notes in the banks in coin o in United States notes, themselves re deemable in and made equivalent to coin As a measure preparatory to free bank ing, or for placing the Government in a condition to redeem its notes in coin a the earliest practicable moment, the rev enues of the country should be increasec so as to pay the current expenses, pro video for the sinking fund required b; law, and also a surplus to be retained in the Treasury in gold. I am not a believer in any artificia method of making paper money equal to coin, when coin is not owned or hek ready to redeem the promises to pay, for paper money is nothing more than promises to pay, and is valuablo exactly in proportion to the amount of coin that ii can be converted into. While coin ie nol used as a eirculating medium, or the currency' of the country is not convertible into it at par, it becomes an artiole o commerce as much as any other product The surplus will seek a foreign tnarke as well as any otber surplus. The balance of trade has nothing to do with the question. The duties on imports being xequired in coin, créate a limited demanc for gold, and about enough to satisfy that demand remains in the country. To ñncrease the supply, I see no way open but by the Government hoarding, tbrough means above given, and possibly by requiring the National banks to aid. The Senate of New York has passed a bill providing for tb compslsory education of children. It is clairaed by the advocates of the measure herewith returned, that there is n unequal distribution of the banking apital of the country. I was disposed o give great weight to this view ot' tho [uestion at first, but ou reflection it will e remembered that there still reniains 14,000,000 of authorizud bank note circuation ascigned to tho States having loss han their quota, not taken. In addi;ion to this tho Stiltes having less than ;heir quota of bank circulation have the option of 12.3,000,000 more, to be taken rom those States having more than their roportion. When this is taken up, or vhen specie paymenta are restored, or are in a rapid process of restoration, will be the time to oonsider tho question of more currency. (Signed,) IJ. S. GRAXT. Exeoutiye Mansiox, April 22, I8T4.


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