The National Finances

The annual repoit of Se;retary Bristow, is a voluminous document, being nearly three times the lengfch of the President's message. We present below the most important features of the report : The total net revenue of the government for the fiscal year ending June 30, 1874, was $289,478,756.00, and the oidinary expenses $287,133,873.76; balance inTreasury June 30, 1874, $150,731,694.63. For the first quarter of the fiscal year 1875, the net receipts were $80,884,285.99, and the expendí tures $85,313,489.42. For the remaining three quarters the Secretary estimates the receipts at $203,434,000, and the expenditu es at $190,000,000. He estimates that the receipts for the fiscal year ending June 30, 187C, willbe$293,000,000. and the expenditures $272,778,000. During the fiscal year the public debt waa reduced by the sum of $5,762,447.65, as will appear by the following statement : Principal of the debt Jllly 1, 1873. . .$2,234,482,998.20 Iuterept dne aml unpaid, and accrued interest to date 42,3SG,(i52.82 Total debt $2,276,839,040.02 Loss oasli iu the Treasury 131,179,337.10 Dcbt, less cash in the Treasury. . . .$-2,145,060 an.W Principal oL thc debt July 1, 1874. . .$2,251,690,468.48 Interest due and uupaid, and accrued interest to date 88,939,087.47 Total debt $2,290,629,555.90 Less cash in the Treasury 150,731,694.03 Debt, less cash in the Treasury. . . $2,l;!9.897,801 .27 Showing a decrease duriug the year, as above statea, oí $ 5,762,447.65 This decrease is represeuted by the excess of receipts over expeuditures $ 2,344,882.30 The interest due and unpaid June 30, 1874, was lees than June 30, 1873, by 3,417,565.35 $ 5,762,447.05 Upon the subject of specie resumption the Secretary is very pronounced in his views. He says : The law should alf o authorize the immediato conversión of legal-tender notes into bonrls bearing a low rate of interest, whicu, while inviting conversión, ehonld uot be eobigh as to appreciate the legal-tender notes rapidy, and thereby opérate oppreseively on the debtor clans. As an additional inducsment to the conversión of United States notc into these bonds at a low rate of interest, autlioiity should bo given for making them Kecnrity for the circulation of national banks. The law should íurther próvido the means for the redemption of such notes as may be presented for that purpoee when the period of resumption shall havo been reached . To this end, the Secretary should be authorized to make a loan not exceeding the total amount cf notes remaiuing unconverted at the time of rO6umption, less the surplus revenue to be made applicable to such resumptiou. It is probable that the gradual and conthmed revival of business will so lar increase the revenues that a large loan will not bo required for this purpose ; but it is advisable that the Secretary be authorized to make it in order to meet the contingency of a failure of surncient surplus revenues. Such a loan should be made by issuiDg bonds to run for such time as the wisdom of Congrsss may suggest, and to be disposed of from time to time as the necessities of the case mav recmire. In the opinión of the Secretary theee bonds should run for a long riod, and thould bear interest at a rate not axceedingthe lowsr rate which the government may then be payiug in refundiug its C per cent. securities. Any sutsant al or u-oful movement for resumption neceünanlr i;ivölveb suplying the Treasury witli incieapëd' amounts of coin, either by increased revenuiB or any adequate loan. Tlie presont condition of the credit of the government, which wo-uld be further enbanceü by the adop'in of measures for return to a epocie basirt, leaves no room for doubt that a loan for fcuch purpoee would bo readily taken at a low rate of interest. Measures shculd aloo be adopted requiring the banks to hold gold reserves preparatory to resnmption on their part. But the Secretar y does not deern it proper to puraue the matter in further detail. lf Oongress shall conclude, ashe carneBtly hopeB it will, that tbe time hasarrived for the enactment of a law having for its object resumption of specie paymonts, its owo wiudom will supply the nccessary methode. Tliat whieh is of the higheet importance is the adoption of the defiuito pohcy of reëumptioo. In view of tho gieat and pressing importance of the spcediest return to specie paymeut consonant with Bteadiuess of business and avoulable of violent and sudden contraction, diecuseion of mere details in advance bocomes of little practical consequencc. Wliat is demanded by the best interests of the government and the people, and by tho lngliest eonsideratious of virtue and morality, is that Congres shall mido that state of things whieh onty tho necessities of war justitieel or required in tliiH respect. A wies modiñeation of exieting ADAMS etatutes, whieli neither enablo nor permit tlie executive branch of the governmut to effect the reetoratioii of a sound currency, will leave the lawH of free trxde to resume tbeir operatione, and many matters of detail will adjust ihemselvcH. Whentbe govornment Bhall have resuraed ppecie payment, ït maylje expectel that gold will flow mto tho country n obedience to the law of supply anrl demand ; the export of our gold product will greatly dhuinish, and tlie millions of gold whieh now contitute only a comniodity bt trado will ïeunme its proper funïtionsby becoming agam a part of the circulating medium. Wilh the adoption of the poliry of reaumption, free banking may afely be allowed, and the deficit of ihe actual amount of coin available for circiilation can be supplied by b mk notes convertible into coin, in lien of an inconvertible paper currency. The enactment of alaw having for itn purpose the Bubstitution of a sound and BtaWo mejinm of exchajige foran irredeemable paper currency will tend to restore confidence, and thuB causo a revival of industries and general businosö. 'l'h'.ro will no better time in the l'uluro to enter upon the woru oi' retorniog to a speoie basis, and the Seeretary foela that he cannot too atrongly urge the adoption oí the meaauroa lie has indicated, or auch others aa will more eertainly lead to the doaired end. In connection with thia aubject tho Secretary deema it proper to suggeat, for the coneidoration of Congresa, the importance of the moet rigid economy in the public expendituree. The length of time that haa now elapsed aince the flnal overthrow of the rebellion, as well as proper regard for the faith of tbo natioD, admonish uu that initiRtory ateps tov&rd tho redemption of ita plodgea ought not to be luuger poatponed. It. ia not unworthy of remark that tho era of tho war will not be closod until the period of rodemption ehall have boen reached. In a country liko ours, with varied industries and oxtonaive commercial relations among its different Beetiona and with other natioiis and peoplea, atability of tho circulating medium ia icdicpenaablo to the general proBperity. Credit, which neceesarily enters largely into commercial transactiona, oan only be steady a ni aecure when it haa for ita foundation a 'atable curroney. The quality of Btability in money attaches only to coin, which, by common consent of maDkind, ia the medium of exchange, and to a paper currency representativo of coin, because convortiblo into it at the will of tho holder. The reason is obvioua: for coin, hesidea being recoenizod throughput tho wcrld as a medium of exchange, has a high intrinsic yalue, can be procurad only by labor and inlimitod quantities, which cannot be increased by statutory lans, nor suddculy by other means, whüe inconvertible paper' money ruay be produced in iudefiuite quantities ftt a nominal cost, a note of the higheet denomination costing no more than the lowest, and ite volume dependiug eolely on legisUtive enactment. The history of irredeemable paper cnrreioy repeats itaèlf whenover asd whorever it is? used. It increaees present príees, deludes tlie laborer with tho idea that he la getting higher vaces, and brings a ñetitioua prosperity from whieh follow inflation of business and credit and exeess of enterpriBe in ever tacreasing ratio, nntü it ia discoverod that trade and ootnmerco have become fatally diseased, when oonfidence is destroyed, and then comes the shock to credit, fonowed by disaster and depreesion, and a demand fer relief by further issues. A dollar legal-tender note, such as is no in circulation, is neither more nor loss than tho promise of tlio gcvi'vuranut to p:ty a dollar to the bearer, while no oxvnoíH provisión is made by law for paying tlio dollar at any time wliatever ; nor is tbere any existing provisión for converting it into anything that staurls in & tangible ratio to a coin dollar. As far as existing laws go, there ia no reason why tho legal-tender note of tha denomination of a dollar should pass for one cent of gold, except ao far as the government compela creditors to accept it in discharge of obligations to pay money, and obliges the wealth and commerce of the country to adopt it as a medium of exchange. To ttíis may be added, as an element of the value of the legal-tender dollar, the hope that the government will sometime or other redeem its paper promises aceording to their import. The universal use of, and reliánce upon, such a currency tenda ti blunt the moral eeuse and impair the natural eelf-depeudence of the people, and trains thom to the belief that the government must directly aesist their individual fortunes aud busiueee, help them in their personal affairs, and enablo them to discharge their debts by partial pa3-ment. This inconvertible paper cnrrency begets the delusion ihat tlie remedy for private pecuniary distress is in legislativo measures, and makes the people unniindful of the fact that the trae remedy is in greater production and lees spending, and that real perity con: e i only írom individual effort and thrift. Wheu exchanges are sgain made in coin, or in a ourrenoy convertible into it at the will of the holder, this truth will be undei stool andacted upon. YVlule it seems to be very generally conceded that resumption of specie payment is efsential to the honor of the governmsnt and to the general welfare, the views of intelligent and wtll-informed persons as to the uest method of resumption aro so widely dtvergeiit, and the plans that have been suggeeted eo mu'tifariouB, that the tëecretary feels cmbarraesment in suggeeting a plan the dttaile of which will commend themeelves to Congres?. But there are one qr two fundamental ideas underlying the subject whicli, it is believed, must be the basis of any practicable plan for resumption. and are, therefore, anbmitted for the consideraron of Congretss. It is obviouB that there cn be no reeumption by the government so locg as the volume of paper currency is largely iu excess of the poseible amount of oïin uvailable for that purpose shich may come into the ïreasury in any year, and while no provisión is made for the conversión of this paper mone into anything baving a nearer relation to coin : nor is it possible fothe banlig or pe' pie to resume so long as the large amount of irredeemable fiaper now in circulation continúes to be by aw legal tender for all private dnbts witü reference both to the past and the future. While this state of things laats, gold will continue to flow from us, and find employment where the natural Iaws of trade, unobstructed by rettraining legislation, mako its daily uae inditp3nf able. The Seoretary. therefore, recommends Congress to provide by law that aft er an early and Hxed day United State notea ehall caase to be legal tendera as to contracta thereafter made. But this provisión should not apply to official salaries or to other ordinary expenditures of the goverument under then existing contracts or appropriations. Betweep the day thns to be flxed and the time of final reeuiirption a sufficient period should elapse to enahle the people and banks to prepare for the latter by such gradual processes in business as will neither lead to violent contraction in credit and values, nor suddenly crease the obhgations of aebtors. Ihe suelden aud itnmediate appreciation of the paper dollar to ita par value in gold is uot only no necessary element of redemption, but, as far as practicable, ehould be avoided. If during the period of the war tlie legal tender acta operated as a bankrupt law, compelling creditors to give acquittauces upon the receipt. of less than the f lül amount of debts, this ia no reason why the law for reeumptiou should now comp'el debtors at once to pay essentially more ihan they have contraeted to pay. Tlie adoption of such measurea as will iiot euddenjy increaee tbe obligations of deLtors will go far to allay and diBarm whatever popular oppoBÍtion to resumption specio payment may now exist, and, beeines, would be but juat to the debtor class. The day from wbich new contracts must be discharged in coin bhould be tixed Hufficiently f ar inadvance to give tke people and the bauks time to understand it aud to prepare themselves for it. It ia believed thit not many months will be neceBsary for that purpose ; but, to avoid the miBclnefa already i'ndicated, tb 18 day sliould precede the day of ftnal resnniption by a longei period. Tbe time should not, in the opinio.-, of the Secretary, be exteuded beyond tlireo years, aiid might Hafely bemade asmuch less as, in tlie judgm3nt of CongresB, would suificieiitly protect the interests of debtors tnd avoid the evils of too sudden coutraction. Tbe öecretary states tliat 2,200 national banks have been orgamzed under tbe National Bank act, of whicb 2,004 were in operation on the 2d of Ootober last. At thr.t date the aggregate capital ei' these banks was 493,765,121, witb. a surplus in addition of $128,958,10G ; circulation outstanding, $333,225,298 ; individual deposits, $609,068,995 ; loans, $949,870,627; specie, $21,240,945 ; legal-tender notes (incluaing United States certifleates of deposit), #122,846,946 ; redemption fund -with the United States Treasürer, $20,349,950. The Sccretary recommends the imposición of a special tax upon all interesc-bearing deposits, with a view to preventing the payment of interest on bank deposits. 'lhe act of June 20, 1874, limits the amount of legal-tender notes to 382,000,000. The authorized amount of national laiik notes waa not changed, but remanís at $354,000,000. Tuis act próvidos, however, for the transfer of circulation from the Eastern and Middle States to the Western and Southern States, as may be required to supply applications for circulation, upon an apportienment based on population and wealth according to the census returns of 1870. The act also provides tor the deposit of legal-tender notes in the Treasury, and the surrender of the bondfs deposited with the Treasurer as secnrity tor the like amount of oirculating notes. Under this provisión the banks have voluntarily surrendered $7,714,550 of their circulation ; $6,492,285 of the notes of banks in liquidation are still outstanding, and a email amount ($2,072,754) of the $354,000,000 remains unissued. The whole, amounting to 10,279,589, is now at the disposal of the Controller, or will be hereafter available for dislribution as this circulation shall be redeeined ; so that it is not probable that it will be necessary to withdraw circulation from banks locatod iu States which are in excess for some time to come. The operatious of the United States Mint for the year aro recited at length. Tlic amount of gold coinago was $50,112.090; silver coinage, $5,983,601; gold bars stamped, $31,485,818 ; silver bars Mi'Dipr,!, ï-M;.Kt7.7!l!l. IS TliO mate of the Director of the Mint shows a train in specie and bullion in the last twö fiscal years of about $38,000,000, and the stock of specie in the conntiy to be about $106,000,000. With a view to the resumption of epecie pnyments, ït ia important to manufacture a large qnantity of silver coin to take the place of the fractional notes ; and asits preparation at the mints will re-' quire considerable time, it is recomnrcnded that authority be giveu the Secretary to commence the manufacture of suchcoinage, beginniug with the smallest denomination, and to gradually withdraw the fractional notes. Tor the year ending June 30, 1873, the decliné in receipts froin the previous yenr was considerable - falling off from "$183,089,522 to $163,103,833, a loss of nearly $25,000,000. The receipts for the first quarter of the current fiscal year were twoaand a half millions less than for the corresponding period of the last year. The receipts for the months of Öctober and November, 1873, were $21,243,333.25. For the same months of the current year they were $29,755,811. The Secretarv alludes to the ties and incongmities of existing laws imposing dnties on imports and urges a revisión of them. Tho decxease from each source of iaternal revenue for the yeár, as compared witli the fiscal year 1873, was very marked, as will ba seen by the followiuc camparative table : "nurccs 1873. 1874. Spiilts $.-.2,099.371.78 $49,444,089.85 robacoo 84,886 80309 88 242,875.63 Fermeutcd liquon.. '.1,324.93.817 9,304,679.72 BaLka aud bMikers.. 3,771,031 4B 3 387060.67 Ponalties, etc....... 461.M3.06 :4,216 34 itlliesive stamp .... 7,702,370 5 C,13(i,844..r4 Back taxes uuder rcpfakdlawe 6,329,782.00 704,880.14 Tota' $U4,0ï.,45.08 $102,C44,74fi.S8 There was a decreaso in receipts from taxes on spirits of $2,655,281.93 ; tobaoco, $1,143,427.47 ; fermented liquors, $20,258.12; banks and bankers, $3aV 870.79 ; frOm penaltioa, etc, $97,436.72; adhesiva stampa, 81,565,532.21 ; back taxes under repealed laws, $5,564,901.86. Total deerease, 11,480,709.10. The nnmber of brewers engaged in j the production of fermented liquors ■. duriug the fiscal ye&rs 1873 and 1874 was as foliows : Inl373 3,654 In 1874 . Decrece i-.ipo The comparative com value of the exports and imports of the United States for the last fiscal year, as appears from official returns to the Bureau of Slatistics, may be exhibited as foliows : Export.3 of domestic merchaudise. . .$569,433,421.00 Exports of f oreignmerchandisc. .. 16,846,019.00 Total exporta KffiS Imports 567,408,342.00 Execes of exports over importa $ 18,876,698.00 Fxports of specie and bnllion $ 66,839,405.1,0 Importa of specie and Irallion 28,454,9u6.i)O ExceBS oí exporta over import? $ 3o,175,4í)!.00 I Total exc:ts of exportB of mer-' ot'audise ppccie und bulliou SvímpoiUoí same 57,052,107,00 The articles exhibiting a decrease ín importation are prinoipally ! tured wool, $12,183,632 ; manufactures j of silk, $4.149,298; raw silk, $2,606,613 ; manufactures of silk, $5,893,253 ; fine linen, laces, undother manufactures of flax, $2,955.636 ; cotton goods, $7,007,455 ; kid gkms, leathër, and manufaeturers of leather, $1,107,528 ; furs, $379,427; hides and skins, $1,281,565 ; i jute and jute butta, $1,471,727. Of domestic products exported the j following articles show an increase in valué, in currency : Wheat, I 969,205 ; wheat flour, 9,876,430 ; rye j and rye flour, $1,440,999 ; corn andccrn j meal, $1,029,829 ; cheese, $1,400,985; butter, $139,462 ; pork $801,677 ; beef and tallow, $1,576,044 ; tish, .$603,712 ; I leaf tobáceo, $7.610,046 ; oil cake, $487,798 ; horned cattle, $454,900 ; hogs, $838,435 ; agricultural impleinents, $503,839; timber, vood and manufac ■' tures of wood, $2,233,919. The decrease in the exportation of j domestic produets appears principally in the following articles : Raw cotton, $16 019,489 ; bacon, hams and lard, $3,576 025 ; hides, $1,044,641 ; furs and skins, $391,185 ; leather and manufactures of leather, $518,976; sewing machines, $596,424. . The Secretary states that little improvement is observable in the foreign cairying trade. The total tonnage of vessels of the United States is 4,800,652 tons, being an increase over the previous year of 104,626 tons. The tonnage built during the last fiscal year is 432,725 tons, which amount exceeds that of the previous year by 73,479 tone. The Secretary reviews tne operations of the revemue marine, which is represented to be in a satisfaotory condition. and rapidly increasing in efficiency. The life-saving service is alao etated to be in a state of great efficiency. The light-house establishment, which exceeds in magnitude that of any otlier nation, the Secretary says, is keeping pace with the decsands for increased aid to commerce and navigation. The Secretary states that a peremptory demand has been made upon the Pacific railroads for the payment of five per cent. of tbeir earnings, the aggregate amount'now due being $3,000,tOO.