SUPPLMMT TO IM Mil\MBl fill MM
MESSAGE OF HIS EXCELLENCY GOVERNOR F. J. MOSES, JR., TO THE LEGISLATURE OF SOUTH CAROLINA.
L__?_^.- 1
MESSAGE.
OlO'CitixeiU of the. Sei,ole and
House of Uejntsentntives:
I havo called together your honorable
bodies by virtuo of tho power vested in mo by
?o constitution of the Stole, which authorizes
Governor, " on extraordinary occasions,"
to convene tbo General Assembly.
I have t)een impelled t,> exercise this power
y my aenao of public duly.
Tbo occasion is nn extraordinary" one,
nnd its responsibilities, which attach oliko to
t'uo Legislative and Kxeetitivo departments of
tbo Staty government, will bo met, 1 trust,
with a strict regard to the interests of the
peoplo nt largo, from whom they derive their
l powers.
Certain bond creditors of the State, holding
^Br ropreacntiug bonds of several classes hav
ing, in tbo last resort, appealed to the Supremo
Court to pass upon the validity of the State
securities held by them, and to nflbrd them
tbo robot* to which they deemed themselves
entitled, the court have decided that the bonds
in question nro valid, and that the comptroller
. genera 1 shall, "in obedience to tbo constitu
[ tion nnd lows," levy a tax to pay the Intercut
sou tbo said several classes of bonds, such levy
lo bo made before tho 15th day of November
proximo, tbo rato per centum of the tax to be
thus Ioviod to be adequate to liquidate the in
terest past due, and also that for the proscul
year.
l This mandamus covers tivo classes of bonds,
Inmouniing in the aggregate lo $li,519.C00,tive
?hundred and rorty-llve thousand of which
Btave been oxchnnged lor conversion bonds.
Band are now outstanding in that form.
This decision of liio highest judicial tribunal
Lof tbo Suite, thus invoked by a portion of the
public creditors, would seem to admonish the
Slaty government that it should, without de
lay, provide, for tbo liquidation of its whole
bonded debt, upon some practicable basis o1'
adju9tmout,?honorable alike to the State ami
its creditors,?or prepare to witness proceed
ings, on tho part of those who hold its sceuri
Lties, which must eventuate in stamping tbo
State?by tho docrecs ol its own or Federal
Courts,?ns totally wanting in regard for
..rivntc rights or public faith,
If tbo General Assembly could, by nn
instant exercise of its constitutional powers,
destroy every bond that boar* tqton it the
impress of the groat seal ol* the Slate, they
would thereby confer a very great present
benefit upon the entire people, but it would
Im?, lit 11 io Bamc iitin*, an net of monstrous in
jllHticC.
There Is a tribunal Itcforo which States tu 2
fudged, ns well as individuals,
ii is the tribunal of public opinion.
The verdict of impartiul and inexOrablo his
tory Is made up from the expressed jud^nem
of fair minded men, delivered on current
event*.
Lot not that vcnliot be. that the govern
ment of South Carolina?based upon n brond
recognition of the rights of man?eon traded a
largo public debt to provide for im mainte
nance in ihr hour of it* weakness and romorso
lessly repudiates that debt M the (toy of it*
osfmeil jtou'ei'.
While I do mil, for an instant, assume that
any honorable Legislator would avowedly re
pudiate any obligation of the State, yet it
must bo patent to tllO world that to refllSO, or
to fail l<> provide, the means for liquidating
the public debt, is. in effect, to ropttdiato it.
Further delay to net in the premises, bv
meeting the jiifi demuiids of our public credi
tors, t<i the extent of our ability, without Im
posing a grievous burden on the people, is to
ii x upon South Carol ihn the BtigniS -if repu
diation, which must indelibly mark her as the
shame and (>pprubriam of American states.
1 would, however, deem myself unmindful
of the high triad that I hold from the people,
and which limy have also conferred u|>ou you,
fellow-citizens, as their chosen representa
tives, If I were to advise that th<? debt of the
State should be liquidated lit its full ascertain
ed amount.
The State satisfies the demands of honor
and good faith when it does nil that its cir
cumstances allow.
The existing bonded dobl represents, in
great part, an exemption of the (xcople from
hijl'i taxation during the jioriod of four years,
commencing in 1 *?;s.
Its liquidation confers upon us vast re
sponsibilities and solomu duties.
Tl esc rcspoiisibilith s and dutlos we cannot
delegate toothers, but we must act according '
to our best uad.-r.-ti.tiding, confiding in the
integrity of our motive* , and in the just judg
ment of the people, \thi st riyhtx ami obligations
are alike reprettute !??/ ?'.'?? Government of the]
Slat-:
A rurtlicr and imporlat t to isiderntioii that
has induced me to coo vein your honorable
bodies in extraordinary : t .?: ii a is that the
net, which I have scon by \? t t journals, was
passed ami ratified at > i.i r i tint mud session,
withdrawing from the h n? u I c l|ip comp
trollor-gcnornl nil authority to order any tax
levy, has never renched this department, and
ItCUCO, lien not become a l:nv, ns was intended
by the General Assembly.
Tlio decision, therefore, of the Supremo
Court, requiring tho comptroller-general to
order tho necessary levy to pay the interest
on the adjudicated bonds, on or l>e(ore the
15th of November proximo, would?if your
honorable bodies had not been convened?
I have been imperative ujvon the said otllcer,
and he would thus have exercised n j>ower
under the o[>erulion of a statute which tbo
' law-making department of the State govern
ment bud clearly shown their purpose to re
penl.
I therefore thought it proper that you, nR
the representatives of tbo |K>oplo in your leg
islative capru-ity, should be afforded lit? oppor
tunity in season, after further reflection, of
affirming your previous action iu the promises,
reflecting, ea you <!.., tbo airoct expression of
tho popular will.
For your Information, and for that of tbo
people of the State, I have made a thorough
and exhaustive examination of tbo various
classes of our puWic debt, and have prepared
tubular statements exhibiting the tiuu status
thereof. In ibis woik I bavo been ably
seconded by the unremitting labors of Mr.
Waller lt. Jones,clerk of the Financial Board,
to whom I take this public method of return
ing my thanks for his valuable assistunco.
It is duo also to the honorable the treasurer
of the State, and to his efficient book keeper.
Mr. T. J. Mintoii. that 1 should say that I
have uevii nltbrdcd every facility in making
this investigation, and that I have obtained
reliable aid from I bum in acquiring the infer*
inatiou desired.
Every piece of stock, or bond, cancelled and
filed in the treasury, which has been re
deemed, or for which conversion stx-k or
bonds have been exchanged, has been sepa
rately and cirufully cxuiniued; its number
and denomination noted and compared with
tbo Treasurer's registry of Ixmds and stocks
convorted. By eliminating fruui tbo bunds
and stocks outstanding August 1, 1H?S, nnd
from thoso printed since thai period by
Messrs. Murphy's Kons, id' Philadelphia, and
the American Uauk Note Company, of New
York, snob as have boon converted nnd can
celled, or cancelled UllUretl, I bavo obtained a
complete registry of the bonds and stocks
outstanding at tho present lime. The follow
ing statement will exhibit the present condi
tion of the bonded debt:
F ANTE-RECONST RUCTIOi\ BONDED DEBT.
Statement of the Bonde,l Debt August I, I8f?8, .s7,
>t of Etch Vim
/.>>??,; Hi:!.
?< hi net Chnvertftl
It'itrrulrtt ami tbf Balance
CLASS,
V X I? K
\V II A T ACT
I 8 S I' K n
KIR WHAT PUtt! ? K
t>]l'Kl?t?r?d Stock...
Irr Hi.nlHli.ro? Stock...
B KrguUred Slo. lv...
? H.-ui?t..i. <? Stock...
I K?giat?red Htock...
} M<-gi*tered Htock...
Bt-gi* tared Stock...
R?gl*t?r<>d Stock.
17'.M.
J ii nn 1,1 (KM.
Ik>cMiil>ir at, 1H-'.k.
DtHLtnlHT SI, 1HT.7.
DecemlK-r 21, lKAH.
rxH-oiuIxT SI, 18.18.
December ?2, I860.
December 22, I SMI.
ltegiatered Stock.- January 2-.', 1881.
HPHiHti i.il Htock... January 22, Iki;i.
~ gUtored Block... February 0, ISKI.
gutered Htock...! September nii.1 Iii i fin!..-!-,
>n<U. Jon? 1, ItctH.
>nd*. December, 1K.VI.
Bond*._I December, 185fi.
Bond*. Deceatlier, Ihkk.
b Bond*. December, 1R%4.
1 Bind*. i>. n .i. IK..1.
Hoiid*. j December, 1H.VI.
Bond*.' Decent ber, I H? I.
Boud?. December, IHM.
ml ..iSeptMiilxii'hiiiI Hi . . nil...i.
Bond*.(September ami December,
I SOU.
180(1,
? lt. \.ilutl .ti ir> Wat Claim-.
Charleston Kin- I..miii.
Cuii-iiu.ii. il ,s. ? M.iit. Ilouae,.
ConstmclIon N. ? stutu Honao.
Construction N..? Stale Huiimi.
Coni-ttui ii.hi N*w Stale Ilouae.
Cutiati In timi New Stale limine.
(Vhatruriiou New State limine.
Cotixtrurlliiii Nei? Stute 11.mm..
Ouhat ruction New Stain llmine.
OntMtrnelliNi Kew Ktaie Honen.
Funding l'aal lluii Interval and Principal
Charieaton Kjre lemu.
Conatrnctlon New smie Ilouae.
Oonstractton Mew sihi.. Ilouae.
Ontietroelloii N..? Slate Honte.
Aid to Hin.. Ilidg ? Railroad.
Aid i.. Hin? Rldtfii ltallM.ul.
Aid tu Wh? Rldgu Railroad.
Aid |o IMile liidg? Railroad.
Aid to Hlu.. Hi.!;;" Itallroad.
Pnridtng l*ail lim1 Intereat and Principal
funding I'.ot Dim Interval and l'riiu-i|wl
Total.
S?,olo,ow< xi. S U ',7-21 WltftXjOOn oolf:t,Tnl,71? 41
POST-RECONSTRUCTION BONDED DEBT.
FIRST SUB -DIVISION.
^Statement of Antc-Ree.onst ruction Floating Debt ami Debt Fundable ttmler Arts September and December, \W>, Funded from
L, Aufliut 1, 18o8, t? October, 187.?.
CLASS.
r n n k n
W HAT ACT
ISSUED.
FOR WHAT PURPOSE.
~ 3
. t
3 8 a]
Hi
??< ?
Iis
o
u u
c2>
K C
u m
o ?
1^
Iri
~ l -
?
IlcRlntored Htock Sopt'iicr and Uec'r, 1KG0.. Kuiulinif I'iihI lHu- li l.imd Trill. IKifJI fl ?S.VJ.ftTit (Ig
l|.i,m?i im
im'
ltoiuU. Sfiit'bcr ami Dec'r| ISOlC rundlng I'.wt Pile i m.iind Hi in 18871 t- IM^tOD
Uondi.(Seiit'licr and DeeV, 1800h KuiidiiiK 1'iuit Din-Int.mid 1'iin. 1897 0 111,'Jnn
Bondu
. Bond*
MSond?
w
I Augu?t 2?, ltu>8. Hoilcuiiiiioii llilU lio i iviilili-.... 1888 0
'Augtut ?ii, ihk?. hiyniont Intm-t l*ublle DeW.. 188* a
S?*|itcuilicr l.'i, lstlH. Kiindiii? HIIIh Hmik Sliitc-. ?--' k
*}...'..h7:l 41,
tffiU oi
?Ion ou
SVtUiu) no ?.mhi.immi on liuaiu it)
7H.-..4111 OS 7K.0.4H, M
?,.v.n.;um on ijmjmo v) 8A,4oo nn bJt^oool Hfittb l.iso^oo
, *7 ?. tM
ST.Of"! ?SJ,IHlO li.|. ,.M 041
7,ooil h-.'.iki i lOtV.yOO (iti
l?l,o?' 00
78A.4IC tHl
Oil
Tula!. ttem^M W ?^.H7.\4l.i GO f^HMia OO |IS9,77S 4l|f:U3 txm'9iK4,iiooi Si,T48.?ti4i Co
?1'rlnted by Hun>by'a S>jiui, Phitadelplila, l'otal Kiiudi.i? .Sto< k iMUed, tfl IK,,.'S7 35, Total Convi-itnd. 1^179,41. llalancr, Jf?9.41:l t?4
fin handa of Klinptun. ?*
. SECOND SUB- DIVISION.
btStairmf.nl of Bonded Debt Created ? by Jlrcou.it> urfed (Ion rumctit from Auyast 1, IStV4*, /" October, I8T0, and lUiada and Stocti
Bp Issued to Chang* Form of Bonded Indebtednex?.
>
CLASH.
^1*^1^1 Stock...
da.
ltonda.
Bond?.
Bond*.
l Bomb.
IT N I> K R
WHAT ACT FOR WUAt PURrOS*. 0
i a
ISSUED.
i i?
March ?I, Ikkh. Convenloa State Secnrillea. 1888 fl flMOfiOtt OU
Anguat S?, ISfld
r. i.i ii ii v 17, lhk'.i.
lUrch si, iscn.
Marcli 'J7, I SOU.
March 1, IH70.
Total.
nwSlrnl Int. I'nlilic Dil.t... is** ii
Hclli.f of T.?ur.1. IS88 7
OonreraloaStateaeruriilre. ihks, k
(..nid OMNtalaalOM. 1888 fl
IjmiiI ('i.tiiinianton. IS88 (1
i,iu/>sn .it Si*o..r.H:? to
I.i.iki I .m Oil K*>.l,Ollt? oi
S,'iOl]o?l OO .?,lH>T..(mni fan 1.1,11,..mi
?J.^i.otxi oo SOOy?O? ?U
coo/rhu oo cnojnm no
1775,71X1 ST 11,7011
lAnrkij
S4UNMI
7ii.o?i
|t-.7,l?l
?Sn,tKio ii^io.ikio
loljuuti
:m<?./\i?i
f.;..*.:'..-'
817,IK?i:
k
|A(rt,m>0 iii
41 I,..h.i .14
h\l,,l*M Ol
1',44'i.AOU 00
CJ4.OO0 Ml
MSjOUO (m
SI4,IK4.'.k:? :tl ??,?.? ttfit 1 ;M|N^S7,9nuIf l,?74.7t?i f,^?t,ti??i ?l,47n..r>oiitfI,r,7.'.,:u^ f'j,-j4l,08:t 114
?By tranafcr.
REGAPITU LiVTION.
f Ant?-Rpoon?tniclioti Rondnl DeU,onMaa4lag October, lH7:t.|S>7A!,7tll 41 | Converted from Anguit I, 1Mk8, to October, 1h7:I. 104^,721 r.O
I p?at-RiM-onatrui lion Roudot Di lit, Kit-1 Sul>-DivUliin, oiitnluiiiliiig
bT October, 1873. M.K-lo imi
WFoat-Bocotutrurtlun lloiidcd Drl.t, Si to'ihI Snl. li|?ir.|oii, oiiUtnnilinx
1 October, 1873.,. f?;MI,nR3 S4
(?..um Kol from AtiKuat 1, HUM, to October, 1873. . It9,773 41
C..io. 11. d from AuRttat 1, IHrtfl, to Octobar, 1873. 1,)I74,700 Ot?
I?
ToUl. .iy.JlA,8.ril,0a7 3ft I ToUl.?._*fS1187,l?4 00
?SA.00 la currency was jx.lj in to it>ka eraa tum of ?:iai, heuioo real amount Con??r*lou Bond* and Stocka lamed S2^1i7JdD,
It will be seen front the preceding state
ment that the bonded debt aggregates $15,
851,027.35, or $'I0U nioro thaa tbo amount
reiKjt ted outstanding on the 3 lit, of Ocloljer,
is:2. This dilTereneo is accoutred for by the
issue on the 18th of November, 1812, ot $300
funding stock under tho Acta of September
and December, 18U(>.
It will also be seen that I hnvo divided tho
debt into two historical jicriods, viz.: "Auto
llcconslruction Funded Debt," or the amount
of bonds and stocks outstanding when tho
reconstruction government assumed control,
and " Post-RecMistruclion Funded Debt," or
the amount of bonds und stock? which bear
the signatures of tho officers,of. tbo recon
structed government. This latter debt has
been subdivided an lollows: The first subdi
vision shows the tlonting debt.contrnctod by
the ante-reconstructed government, which the
oflicers or tho reconstructed government found
outstanding when they csmu into power, and
which they converted into a funded debt by
the issue of bonds and stocks; tbo second
subdivision rcprcsunts the funded debt ac
tually croatod by the reconstructed govorn
incut, and for which only they are entirely
responsible.
BISTORT OK TUB llONDHp DKUT.
The stock known as tho tbrco por cents of
1794, was issued for the purpose of funding
rortain debts incurred by tho Stale lo aid in
carrying on tbo revolutionary wur. At tho
I close of the war Iho United Stales govern
ment assumed t "is dobls of tbo Suites, hi
Otirrcd in carrying on the war. Tho interest
upon this debt was paid by the national gov
ernment to the State, sud the Stale disbursed
i tho amount ho received to her creditors.
When tbo Dank of the State was chartered in
1812 the moneys received from tho United
j Stales were turned orer to llio bank and
formed u portion of its ttrsl business capital.
Alter u few years Iho United States paid to
j tbo Slate the ontire principsl of this debt,
which amount was also turned over lo the
bstik, and it wns made the duty of the bank
tu pay the interest annually accruing upon
those three per com and lo redeem tho prin
cipal up .'.i presentation. D therefore,
assumed thai this debt is a prior lien upon iho
assets of the bank. Tide siook is held almost
exclusively by citizens of this Slate, having
1k>oii in the possession of single families from
generation to generation from 1*94 to the
present time.
Tbo Fire Loan stuck, amounting to $303,
343.89, and Fire Loan bonds, amounting tit
$481,944 3], are outstanding balances of an
original issue of $'.',000,000 uf bonds issued us
a loan to rebuild the burnt district of tbo city
of Charleston under act of Juno I, 1838. The
I., mis are bvld in P.uru[>u and matured in
18(18. The stock iiiatuied in 1870 and is
owned by citizens of thu lTuit*4 *-???.o*.
In my opinion these bonds and stocks,
amounting in the aggregate to >w85,288.20,
which are now |>usl duo mid payable, uud
also the throe per cents, making u toud of
[ *kS'2-4.12-4, uro not un actual, but a contingent,
liability of tho Stale.
The act autbori/iug the Issue of tbo " Fire
Loan bonds" provides llisl "it shall bo the
duty of tho President and Directors of the
Bank of tbo Stute of South Curolina to make
proper provibion for tho punctual payment of
the interest of such loan us may bo effected
uinrn tho erodii of the Slate, under the provis
ions ol this act, and also fur tho ultimate
redemption of tho principal thereof;" and,
further, ?> that when the profits uf thu tea id
Rank of tbo Statu uf Smith Carolina ahull bavo
paid tho interest on cerUlu stocks und re
deemed said Stocka (all of which, save the
throe i er cents, haru been redeemed lung
sitiiH.'), for which thoy bavo heretofore boen
pledged and sot upatt, the uuid prollts oliall
also bo considered solemnly sol apart for tho
I payment of the iulcrest or. the said loan und
iho tlnsl redemption of thu principal thereof."
The history of this loan is u? follows : Tho
$2,000,000 of bond* were issued to the Dank
of the Stnto. Tim bank through Its ugent,
General McDuBir, secured tho services ol
the Raring Rrolhors, of Ixnuton, to nego
tiate them. They succeeded in disposing of
Rl*)l|t $1,000,000; the remsimlor was returned
to the bank, convened into registerod stook,
and sold In tbo Sis tos. The procoods of the
sale ot these bonds ami stocks were dup<<*nlod
In the bunk ns a part of its working capital.
Persons desiring lo rebuild the burnt district
ol Charleston obtained a louu for that purpose
from the bank, giving a mortgage upon the
property as security for the loan. Tbo bank
received the moneys from the sale of the
bonds and stocks; it received the interest
upon the loans made to tho builders, it re
ceived the principal of the loans at their ma
turity. In justice, tbcreforo, to the tax payers
of the State the assets of tho bank, which
have repeatedly been solemuly pledged and
set apart for tho redemption of ihoso bonds
and stocks, ought to bo immediately so ap
plied.
In the report of the oflicers of this institu
tion to tbo Legislature of 1841 it is emphati
cally asserted *' that the uholt of the means of
the bauk stand as security for this loan."
The prcsideut of the bunk in his report to
the Legislature of dste July, 1308, referring
to lb"" subject, very justly observed " that it
might with propriety bo regarded us n d,eht of
the brink rather than a debt of the State. The
bonds und clocks wore sold und the funds
pbeod under control of the bauk, which wus
charged with thu distribution of tbo lunds,
and also tbo duty of providing for the pay
?neut of the interest and principsl of tho obli
gations ns they Invame duo."
Thu Legislature, under act of December
21st, 1805, again pledged and appropriated
the assets of the bank?first to the payment
of tbo tiro loan bunds in Kit rope : second to
the tire loan stocks in America, and third to
the bills id iho bunk.
Tho Legislature, under act of September
15th, 1808, disregarded this contract with
tbo hol de is of this loan, and directed
the sale of the assets, under tbo direc
tion of the Governor, the proceeds to be sub
ject to the order of ibu Legislature, and also
authorized tbo futiding of tho bills isauod
prior to December 20, 1800. The sale of the
assets was enjoined by tho courts, and tho
claims of these setcrul classes of creditors
uro still the subject of litigation.
The whole history of this loan, as read in
the annual repot Is, bold of tho oPlieora of the
bank Slid lliu eoiii|>tl ollcl??general, conclusive
ly proves that the interest on the loan as it
accrued, and tbo principal as it matured,
were made a piefeired claim upon tho entire
funds of tbo batik.
In 1843 tbo late C M. Furmau, then cash
ier of the bank, iiuido a statement showing
(bo probable oporation of tho bank in tbo
payment of the public debt, in which bo
allowed that on the 1st of January, 1K70, at
lor tho redemption of the last instalment ol
tho tire loan, there would be a balance of
funds iu the bauk to the amount of $2,418,
927.35.
I am aware that the available a sac In of the
bunk, according to the reports of the Legisla
tive committee of 186s, appointed to invest i
gato this matter, if sold, would probably bo
insufficient to cancel this entire indebtedness,
viz., $8*24,124; but these fuels havo been
adduced to show that thuy should be so ap
plied as tar as they will go, nnd tbo deficien
cy, if any, cou'd nttcrwurds Ihj providod for
by the Legislature.
I repeat, therefore, that tho tiro loan bonds
and slocks and the throo per cent, stock are
not actual, but contingent debts of tho Stale.
The actual (I .bt is thus reduced to $15,027,
503.35.
The aggregate amount of bonds and stocks
originally issued under the seroral nets au
thorizing the issue of bonds and stocks for
the construction of tbo new State House
was $2,280,600. Of this sum $1,034,811.5!?
havo lx en cancelled, and conversion bonds
issued in lieu thereof, and $212,000 have
[been redeemed, and $1,251,738.41 are now
j outstanding in their original form, as wi'l
more fully uppear by refereuco to the state
ment of tho bonded debt.
Tho faith and funds of the State are sol
emnly pledged for the payment of the inter
est and principal of this debt. Uf tho amount
outstanding $38,000 ol bonds of 1853 are
past due, and no provision bus been made for
their redemption.
The bonds originally issued under the net
of 1854, us m subscription to the Hlue Itidge
Railroad asuHioled to $1,000,000. Of this
sum $34,000 have been converted and can
celled, ami conversion bonds issued in lieu,
and $900,000 are now outstanding in their
original form. Unlike the l>onds und stocks
previously moaiioncd, no provision has been
made by pledge of the faith or credit of the
Slate, or otherwise, for the payment of the
principal or interest of these bonds.
The bonds and stocks originally issued
under tho nets of September and IVcemtier*
lSOO, for funding the interest und principul of
certain t>oiid.? and stocks past duo, aggregate
$1,100,287.35, as follows :
Boasts maturing la lssT. fSOtf.OOU Oil
Bunds maturing la 189" . Btl.OOO on
Stock maturing ta lssl. MS.lsT 83
Total.S1.1M.-Js 7 SO
The total amount convortod was $I5C.
073.41, as follows :
Bonos maturing In IBM . sta tine oo
lton.U maturing In 1 -t>7. 4ft*MU on
BUm-w nutating tn ls-?I. ?s.sts 41
Total.ii.v, t>T I 41
Th>> ?oiut ItwtaiMw o..i^i....a;..B ;.. ^i,ooa,
01X94, as follows :
Bands maturing In ls3".$4&v.4uo on
Ilona* malmIn* tu im?; . 4*4,sOO no
8io.l maturing in its;. 7v,4is ?4
Total. ?1.00V.618 t>4
These two acts authorized the funding of
the interest due upon the outstanding bonds
und slocks to tbo 1st July 1807. amounting to
$069,096.44 ; ami also the funding of the
priucipal of the bonds of 1859, lo uid tbo Blue
Uidje Railroad, due in 1805, amounting to
$310,000 ; ulso baluuco of certain *to?k,
nmounling to $3,705.40, making u total
amount fundablo of $1,289,801.90; lotuj
funded, $1,100,287.35: balance not yol
rut.dud, $110,514 55; udditionul amouiits paid
In by parties to make even sums of $100, or
$->0, $531.17; loss fractional amounts relin
quished by stockholders, $298 09 ; balance
fundable $1 10,751.03.
Tho bond., originally Issuer] under the act
of August 20. 180S. lo redeem the obligations
known ns the bills receivable of the State,
amount lo $500,000. 'Ibese bills were issued
under an uci of December. 1805. The amount
redeemable under the act of 1808, wus $300,
000. Of ibis sum $298,702 were redeemed by
ex-Treuamer l'urkor, und $82 huvo been ro
i deeinud by the present treasurer, as cash on
ucvo< ' of taxes ; there is, therefore, u balance
outstanding of $1,-10.
It appear*, by the re|>orls of the financial
agent, that these bonds were sold for
70 conte on the dollar, realizing $.150,000.
Tbo loud amount ol bills redeemed by the pro- |
vious administration was, as boforo stated,
$298,702 ; ttiero ought, therefore, to havo
been a baluuco ot cab to the credit of this
I account on the 30th or November, 1872, of
i $61,298.
In comparing the aggregate receipts and ex
j peuditures of the last administration, this
amount is accounted for in the ex|>enditure for
general ptirjHiaca, still I found it impossible to
I ascertain the object of expenditure to
which il was actually applied.
Under tho act ol August jC. ISOd, to au
thorise a loan to pay interest upon the public
debt, tbo Ameriom Hank Koto Company
priuted $2,000,000 in two issues. Tbo first
issue amounted to $1,000,000. On account of
some alleged omission, they were not consid
ered as snlouhlo as were other bonds of the
Stale. It was, therefore, determined to prc
pare a second issuo of $1,000,000, and
lo retire and cauccl tho first issue. Of
said issue $500,000 were retired aud de
al rot ud by burning, as apjsjata by tho
certificate of livo of the officers of tbo exe
cutive department; $50,000 wero can
celled and are on tile in the treasury ; $450,
000 wero uever retired, and therefore exist as
a debt of the State. Tho entire amount of
the second issuo was also negotiated. The
total debt created under this act then amounts
to $1,150.000. Or this amount $253,000 havo
been cancelled, and conversion bonds issued
iu lieu, and $ 1,197,000 are outstanding in their
.original form.
In order to ascertain what proportion of
Ibis debt is chargouMe to tho ante-nconstruc
tion administration, the following inquiries
should bo made :
1 1st. The whole period iu months from tbo
dato tbo interest was last funded to the date
to which the interest was payable under this
act, from the proceeds of the sale of these
! bonds.
? 2nd. What proportion of this period be
longed to the sute-recoustruotion period, and
what proportion to the post-reconstruction
period.
The language of the a> t is rather ambigu
ous, but lake.i in connection with the recom
mendation ol Governor Scott, in his first mes
sage, which recommmidaliou it was the ovi
dent intent ion of the legislature to adopt, it
appears that the proceeds from the salo of
these I' aids were lo l>o applied to the pay
ment of interest on tho public debt, accruing
from tbo 1st July, 18C7, to 1st July, 1869, a
period of twenty-four months. Tho interest
accruing from July, 1867, to August, 1868, a
period of thirteen mouths, in chargenble to the
ante-reconstruction period, und the intcrcBt
accruirt|-from August. 1808, 10 July, I860, a
period of eloveo month", is chargeable to tho
post-reconstruction period ; ?ir, in other
words, 13-24 of the entire debt of $1,460,000;
amounting to (786,410 68}-. is chargeable to
tho former period, and 11*24, amounting to
$604,583.334-, iii chargeable to tho latter pe
riod.
It tnny be proper to state, in conneetion
with tltis subject, that the Legislature, st its
session of I86S-?9, appropriated $500,000
for lite payment of the interest due for thid
name period, so tlint there wi-ro really two
sources of income to meet this indebtedness.
In comparing the huiuiiqi of moneys received
from taxes, with tho money* expended on
count of appropriations for this *amo period,
it appears thni tho expenditures, cxchiaivc of
tha payments (or interest, exceeded the re
ceipts from tuxes, and therefore, it is assumed
that the interest was paid from the remaining
source of revenue, vir : the proceeds from 'lie
sale of these bonds
Under tho act of September 15, 1868, for.
funding the bills of the Bunk of the State, tho
American Bank Note Company printed $1,500,
; 000. Of litis sum 1,269,000?wore issued, the
others were cancelled unused, til the amount
issued $69,400 we reconverted and .vl,IH9,C00
are outstanding in their original form. The
bonds prepared under the act of February 17.
1869, for tho relief of the treasury, amounted
to $1,000,000, of which $101,000 "were never
issued, ami tiro cancelled und filed in the
treasury : $43,000 of the remainder hove been
exchanged for conversion bonds and $850,000
are now outstanding in their original form.
Tho stock origimdly issued tinder the act of
March 23, 18159, for the conversion of Stale
securities, amouutod to $776,700; of which
$711,700 have been converted into conver
sion bonds. $6,000 represent stock transferred
and $64,000 are outstanding in tho original
form.
Tho issue of the conversion stock is ex
plained in this way: when application was
mndu to tho treasurer by a person holding a
bond of tho State to have the same ex
changed for a conversion lmnd, the treasu
rer took up such boud and issued in lieu n
ptece of conversion stock of equal amount,
which stock was thou cancelled and exchanged
for a conversion bond. This romidulioul pro
cess wus proscribed by the uct for tho con ver
sion of State securities. Several persons p-.o
ferred to bold the conversion ?i<x-k, and. there
fore, did not carry the o|iorulion further,
which accounts lor the outstanding balance of
$G4,U0O before rolerred to. Of course this
amount does not represent nn increase of the
public debt, but merely represents in another
form somo pre existing obligation.
Tl... MiU* UMHRl fjt I-*-????.? .?
I the said net for tho conversion of Stute secur
ities was $7.676,600. Of this sum $1,611,
500 were ismiod merely to chunge the form of
some pro-exist'iig outstanding indebtedness,
in. the form of bonds and su cks previously
authorized, und hence do not represent an
in errate of the public debt.
The $34,000 of conversion Ixmds converted
! and cancelled arc tints explained.
A person holding $1.000 of Umds of diner
out classes (siy luuding interest, etc.. $300 of
the denomination of $100; funding bills Hunk
of the State, $500 of tho denomination of $50,
and conversion, $200 of the denomination of
$100,) would present them to the treasurer,
and receive in exchange a piece of conver
sion stock of the denomination of $1,000,
and io oxchauge lor said stock a conversion
hot.d of equal amount. Thus. $34,000 of
conversion bonds found their '.vny bnck into
the treasury, nud bonds of the snme class,
but larger denomination, found their way into
tho market without tncrea*ing the volume of
debt.
I repeut, therefore, that there are no 10 out
standing $1,677,600 of con version bonds is
sued in sttiet nccurdnnce with law, which nre
merely tho representatives of lumds and
slocks of various classes, and, in tho aggre
gate, of equal Mitbunt cuncelled and tiled in
the treasury. This statement is based upon
my porsonul examination of said cancelled
bonds and stocks, and may be relied upon as
accurate in every particular.
There are also outstanding e. .... . m bonds
to tho amount of $5,965,000, frith a repre
sent an actual incre?$e of the publi debt.
It has been alleged that Ilvese I ?ids wero
hypothecated for security of loans, by order
! of tho Financial Board, and the moneys re
! coivod tborefrom used to cover the deficit of
revenue from taxation, or to "bridge the
ehaam " botweou tho receipts and appropri
ations, and tho State being unable to redeem
the bonds at tho maturity of tho loans, they
! were forfoited and sold, and thus, by the
amount represented upon their face, increased
tho public debt
I will not venture to assert that these alle
ntious are entirely at variance with the facts,
t because I hsvo Isjen unable to gel access to
tho records of tho Financial Board, or to ascer
tain the exact time each particular loan was
negotiated, and the amount thereof, as also
i the amount of bonds forfeited lor each loan
the Stute failed to disehurgo at maturity. Hut
this I assert with certainty, that more than
I oue-aoveuth of said amount is accounted for
iu another war.
It appears, that on the 7 th of December,
1870, tho then ttoasurer of the Slate, in a
i letter addressed to tho financial agent, (a
copy of which is of roeord in the treasury,)
stated that the Stalo owed n debt of $303,
343.89, duo in 1S70, known as Fire Loan
Stock, and also a debt of $250,000, duo in 1871,
ktiown as State Capital Bonds, which debts
tho tlusncisl bourd had instructed him, the
trcaauror, to discharge, with authority to
make whatever arrangements might be neces
sary therefor. Ha accordingly placed in stud
agent's possession bonds for the conversion
of Slate securities, amounting to $800,000,
directing him to make such use of ssid bonds
aa he might doetn necessary lo redeem suid
oblige tious.
The sequel of this arrangement shows that
$212,000 of State capital bonds have been
redeemed, $203,000 by tho I'.uancinI agent,
and $9,000 by the treasurer.
NY hot her the etttbe amount realized from
tho sale or h) poihccut ion of the said $800,
000 of conversion bonds was barely sufficient
to ledeem the $212,000 of Stale capital
bonds, (purcliaseablo at that time at a price
bclmv 80 per cent.,) does not appear. In the
absence of evidence lo tho contrary, and in
asmuch aa no fire loan stock was redeemed,
it may aafely be assumed, that such was
actually the case.
The bonds issued under the act of March
21, 1869, for the purposes of the Laud Com
mission, amount to $200,000, and under the
Hct of March 1. 1870. for the sumo purpose,
lo $500,000, milking- n total of $700,000. Of
lie- Iii - * issue $76,000 have 1**01) cnuc*lled, and
i-onvi rsiou bonds issuer! iu lieu, nud of tho
second issue $157,000 have changed their form
in '* e na)OmuUQf>r, leaving $4U7,000 outstand
ing 1.1 their original form.
This concludes the history of the bonded-in
debtedness of the State.
Tho InU***! due slid puyaMr upon tli?
boad??l debt, oa ih? siit of OeliAse,
1874, a* np|n-nr* l.v tli- treasurer's
buuks, pmiiunU lo. ft ,488,918 85
Tlio it.ten at iluu and |m>aMr on th.>
81st of <>< tor?rr, is;?, nmuunUfat.... 913,S80 81
Total InUrrtU aecrui-d anil accruing,
October 81, .
There Is also an unfunded bnlii'i
7.r>l.r,:{, fundable under tho acta of September
and December, I860, which mhy properly bo
iucluded in the Hooting debt of the State.
The special committee appointed by tho
I.? gishttttrv, session of 1872-73, to invest'gate
the amount of outstanding pay certi?cate?
and bills payable, re{K?rted that they had ex
amined outstanding pay certificates and biUa
payable to the amount of $401,869.98. Tlio
committee asked for further time to continue
their examination, which was granted. It is
assumed that there is an additional amount
outstanding, which the committoo will prob
ably examine and report upon ut your
nresont session. The total amount outstand
ing nay be safely estimated at $500,000.
1'. is also estimated that there is an unpaid
balance of pay certificates of tho session of
1872-73, amounting to about $100,000.
It appears by the trcasurer'a books that
the Stnle IS charged with tho sum of $1,797,
362.94, ou :.?vonul of $3,395,000 of bonds
surrendered by the Bluo Ridge Railroad in
accordance with the provisions of an act of
the legislature, approved March 2, 1872.
There is also upon tho treasurer's book a
largo miscellaneous floating debt, including
unpaid tree school fund, and all unpaid ap
propriations, not payable us deficiencies after
October 31, 1873, which is estimated at about
$450,000.
XKCArtTVLATtOX.
Inten si Upon Uomb-d IMu to (iViober SI,
.?8,848,89* 78
1>,M rundaMe im.I. i- Arts h.-pti mUr arnl
DrciiiUr. lsij?. 116,761 6S
Pny r.-rllMc?!f* an.l tills |.a)?t.l? twaalutia
of 1S70-71, 1K7I-78.. 800.000 00
Pay ccrllnvatirs -eaalon of ISuS-TS.. .. .. 100,000 00
1)< t.l due Blue I'M** Kallr.wtl. 1,WJB&> 94
Mliu'rltaiKFoiin Floating Dritt. 450,000 00
Total.
Footled Debt,
KluaUln;,' IM>t.
KI.OATIS?} IIKUT.
.t&,SO?.S97 7S
IIM?.'7^0? 8ft
. ?,SOC>97 7a
Aggi*i?te Floating and Kun.Usl Dol.t.. .SSO^RS,90l 10
The passive, or do-nothing policy which
lias noi.tiiteo Iu tiio iieauuehl ot too puuTie
debt, .since 1871. has unquestionably proved
disastrous to the credit or the State.
The lax payer,' relieved for the time being
from the payment of nu extra tax, regarding
the bondholder ns n parasite, living at tho ex
panse of forced contributions from his small
und insutlicieul revenue, "reaping whore be
bus not sown," has been disposod to let tho
debt und tho holders thereof tako euro of
themselves; hoping thai some beniticent
providence would ultimattdy rollove Aim of
the burden; caring littlo whether relief came
from repudiation or the assumption of tlio
debt by iho national government. But In th?
meanwhile tbo unpaid interest accumulates;
ihe probability of the assumption of our debt
by tho national government Is remote; threat*
of repudiation begin to assume tangible shops
and citizens are found bold enough to give
them utterance; the bonds of the State are no
longer enquired for at tho stock exchange;
tbo credit of the State is lost almost beyond
redemption.
It is patent to tho unprejudiced mind that
unless we propose to adopt in this Stale thst
policy which has made the name of the onro
proud State of Mississippi infamous in the
commercial tnarkuts of the world, such prompt,
im mediate action is imperatively demanded- aa
will demonstrate to the creditors of the State
our honest determination to adjust and settle
our entite indebtedness according to our best
ability.
No' one doubts that to levy at ibis time a
tax largo enough to cancel our floating indebt
edness, or oven to pay tho accrued and accru
ing interest upon iho bonded debt, would
paralyze the business energies of the State, and
would be equivalent to an actual conllacatiou
of the properly of every citizen.
To fund the whole of tho floating debt at
par would increase the public debt of
tho State. This is expressly forbidden by
s recent amendment to the constitution,
unless two-thirds of the qtialitled electors
of tlio State, voting upon tho ques
tion, should give their assent to such
iucreaso. Kven assuming that their assent to
such increase could be obtained, tlio present
condition and resources of the Stnto do not
warrant tbo collection of an annual tax ol
about nine mills on the dollar, in addition to
all other taxes, to pnv interest upon tho public
debt.
The question then arises what is to be done
under tlio circumstances f There ore these
who even object, strenuously, to the levy of
any ta.< at all for the present to pay interest;
but ire mu.it either pay or repudiate. If from
Jauuary 1871 to October 1873 does not furn
ish the tax payer a sufficient breathing spell to
pretiuro tbo way for tho resumptkiu of Iho
interest payments, then three additional yoars
with nil their interest accttmulationa will not
i-fiord it. Hut I am salisfled that ih'.H class of
grumblers comprises but a small minority of
the lax payers of the Statt.
They would grumble whether tho ta-? bo
(Hie mitt or ten.
Taxation is considered an evil always to be
shunned; but there arc evils much toorae then
that. Tho loss of credit, public and private,
the contini' ition of such action as will bring
discredit upon tho lair name of the State ami
cloud the honor nnd ultimate good intentions
ot tbo (K'oplo with suspicion of diahonorable
repudiation. History is pregoaut with d'-.s
I nations of tlio fact that such a remedy is far
woiso than tbo disease. It is .relevant to our
pi escnt purpose to reflect upon tho way the
I debt has been contracted, or to estimate what
consideration tin* State received in return. Tho
debt exists, and sound public policy deroauds
that some provision no msde at once lor ita
adjust mont.
Tbo language of tbo treasurer of North
Candina in his annual report of November,
1872, applies with peculiar lore? to the present
con. Ii i ion of at lairs in this State. I can do tu?
better than quote his words end recomsneitd
their careful perusal end cons Wer at Km j
'? I much fear, whim 1 do uot apprehend,