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? sirmmmr m the mamebum sews. MESSAGE OF HIS EXCELLENCY GOVERNOR F. J. MOSES, JR., TO THE LEGISLATURE OF SOUTH CAROLINA. ORANGEB?RG, C,f OOTOBE?, 1873. MESSAGE. ow-citiztixs of the Semite ami //phw of Iiepvcsentativc*: I liavo palled together your honorable bodies by virtue of tho power vested in me by 10 constitution of the State, which authorizes e Governor, M on extraordinary occasions," to con veno tho Goneral Assembly. 1 have been impelled to exercise this power my sensu of public duly. Tho occasion is nn ?'extraordinary " one, nnd its responsibilities, which attach alike to tio Legislative and. Execntivo departments of tho Stale governmoul, will be met, I trust, with a strict regard to the interests of the peoplo at htrgo, from whom they derive their powers. Certain bond creditors of tho State, holding representing bonds of several classes hnv ing, in tho last resort, appealed to tho Supremo Court to pass upon tho validity of tho State securities held by them, nnd to n lib id them the relief lo which they deemed themselves entitled, tho court hnvo decided tha.t the bonds in question nro valid, nnd (hat the comptroller* genera! shall, " in obedience to tho constitu tion nnd laws," levy a tax to pay tho interest u tho said several classes of bouds, such levy to bo made before tho 15th da}' of November proximo, tho rato per centum of the tax to bo thus levied to be adequate to liquidate tho in terest past due, and also that for the present year. This mamlamm covers th e classes of bonds, mounting in the aggregate to $i),54p,C00,Dve undrod and forty-tlve thousand of which ave been oxchauged for conversion bonds, nd are now outstanding in that form. This docisiou of iho highest judicial tribunal of tho Suite, thus invoked by n portion of the ublie creditors, would seem to admonish the State government that it should, without de lay, provide.,for tho liquidation of its whole bonded debt, upon some practicable basis of adjustment,?honorable alike to the State and its creditors,?or prepare to witness proceed ?ings, on tho part of those who hold its securi ties, which must evonluuto in stamping the State?by tho docrees of its own or Federal Mirts,?as totally wanting in regard for private rights or public faith. If tho Uenoral Assembly could, by nn instant exercise of ils constitutional powers, destroy every bond that bears- upon it the impress of the great seal of the Slate, they would thereby confer u very great present beuetit upon tho'entire people, but it would be, at the same time, an net of monstrous in justice. There is o tribunal ln'forc which Slates are judged, as well as Individual*. It is the tribunal of public opinion. The verdict of Impartial and inexorable his tory is mnde up from the expressed judgment of fair minded men, delivered on current events. bet not that verdict be, that the govern ment of South Carolina?based upon a broad recognition of the rights of man?contracted a large public (lobt to provide for its muinto uouce tu the hour of it* weakness nnd remorse lessly repudiates that debt in the (toy of its assured jtower. While I do not. for an instant, assume that any honorable Legislator would avowedly' re pudiate any obligation of tho State, yet it must bo patent to the world that to refuse, or to fail to provide, the means for liquidating the public debt, is. iu effect, to repudiate it. Further delay to act iu tho premises, by meeting the just demands of our public credi tor, to tbo extent of our ability, without im posing a grievous burden on the jreoplo, ja to tlx upon .Sunlit Carolina the stigma of repu diation, widen must indelibly mark herns the shame and opprobrium of American States. 1 would, however, deem myself unmindful of the high trnwt Unit I boa! from the people, and which they hove also conferred upon you, fcllow-citizcna, as their chosen representa tives, if I were to adviso that the debt of the State should be liquidated at its I'm! ascertain ed amount. The Suite satisfies tlio demands of honor and good faith when it does nil that its cir cumstances allow. The existing bonded debt represents, iu great part, tut exemption of the people from high taxation during tho period of four years, commencing in 1 s<;8. Its liquidation confers upon us vast re sponsibilities and solemn duties. These respousibiliihsaiid duties we cannot delegate- to others, but we must uct neeorJing to our best understanding, confiding hi the integrity of our unlive, and in the just judg ment of the people, nhi m right* and obligation* are alike iVpratente < l<y lie Government of the State. A further and importni I ?oisideralion that has induced nie lo coovitn your honorable bodies in extraordinary :<.r:iia is that the act, which 1 have seen by mi journals, was passed and ratified nt y Mr I irni it lud session, withdrawing from the h to n I c l|ie cvmp troller-general nil authority to ordor any tox levy, has never reached this department, and hence, lias not brcomo a law, ns wns intended l>y tho General Assembly. Tho decision, thorefore, of the Supremo Court, requiring the comptroller-general to order tho necessary levy to pay tho interest on the adjudicated bonds, on or l>o(ore the 15th of November proximo, would?if your honorablo Itodies had not been convened? have been imperative u|>on tho said officer, aud he would thus have exercised a power under tho operation of a statuto which tho Isw-makiug department of tho State govern ment hud clearly shown their purpose to re peal. I therefore thought it proper that you, as the representaiivcs of tho j>ooplo in your leg islative capacity, should be afforded the oppor tunity in season, nfter further reflection, of alllrming your previous action iu the promises, rotlecling, as 3*011 do, tho aired expression of the popular v.ill. For your information, and for that of tho people of the State, I have mado a thorough and exhaustive examination of the various classes of our public debt, and have prepared tabular statements exhibiting tho true status thereof. Iu this woik I bavo been ably seconded by tho unremitting labors of Mr. Wultcr It. Joues, clerk of the Financial Donrd, to whom I take this public method of return ing my thanks for his valuable assistance U is due ulso to the honorable the treasurer of the Slate, and to his efficient book keejier, Mr. T. J. Minimi, that I should Bay that I have been afforded every facility iu making this investigation, aud that I have obtained reliable nid from them iu acquiring the Infer* mation desired. Kvery piece of stock, or bond, cancelled aud tiled in the treasury, which Ims liecn re deemed, or for which conversion stock or bonds have ln-eu exchanged, has been sepa rately aud carefully examined; its number and denomination noted and compared with tho Tro'isurer's registry of bunds mid stocks convorted. liy eliminating fruit) tho bunds und stocks outstanding August 1, I808, and trout those printed since that period by Messrs. Murphy's Sous, of Philadelphia, and the American Bunk Note Company, of New York, such as have been convorted and can celled, or cancelled unutfid, I hnvo obtained a complete registry ot tho bonds and. Stocka outstanding at tho present time. The follow ing statement will exhibit the present condi tion of the bonded .debt: ANTE-RECONSTRUCTKhN BONDED DEBT. Statement of the "Bonded Debt August 1, IS'IS, Showing fh .!<.?? ?' of Eich Clan* since Qcm?*rf*tt OuMllrt linit n. i?',ri\ Ul'.i. >r Tteite.rmeil and the ftalunce CLASS. ? Hcglatered Stock... rlli-ltinoriHl Stock... LUcgtiitoroJ Stock... Begist. i. 1 Stock... It. iglatered Stock... Heglatered Stuck.. Be glatered Stock... KeBl?t?red Stock.. f \ 11 K It WHAT ACT ISSUED K.IK WHAT Pt'l:!' ?-.K ,.? ItcvMutiuiiary Wut .'Inn. . At .j Charleston Vir? tonn.? ('oll-'.l 11. li.'ll NcM SllltO llutlhV. Juno 1, 1KW. 1).'.'.?ml..t '/ii, ISM.. Dtcemtwr 21, 18T.7.1Oonutruction New Stuto Hon?.. I December 21, lic.s December 21, isam. December 22, IHM). I December 22, 1K/vj. He>;im<red Stock... January 22, I Hfl I. .Registered Stock... January 22, l??;i. "egiatered Stock... February fl, I8C3. Obrurirnciion Kovf Slate House. . Count ruction New Slattt Hon?c. Conati'iii ll..n New Stute Hiataa. (Juoatructlou New State llouae. Construction New Slate lloum-. Ooiwtfnctlon New St?le llouae. Coiistrui ll.ui New State lloii?<>. Utenxl Stock...^SepterolH-r itn.l December, INK... Funding dial Hue lutcn-at hii.I I'tluciiul.. Ida.I June 1, 1R38. Cb,"rlf?>ton Klre l,..;iu. December, 18.13..Oonatrhetlun N.-w sti?te ll.>n?u. December, 1-'.?">.Construrtion New Statt, House. December. lHflfl. OOMlrOCItoil New State llouae. December, VNA. Aid to Blue IU|lg\? lluilr.md. in. .n.l... l&'.l. Aid to Itlue Ridge Railroad. i December, 18.M. Aid to ?lue UM?.. BaltrMd.?. 'December, 18M. Aid t<> UJlto UMgo lUllr.?u<l. Deceir.lx.r, l-M. Aid to lilac Holge ltuili\wd. September ami December, lK?'.fl..i Funding |*u*t Hue Intern! and Principal., September and Dccuntber, ISflO..: funding I'd Duo Intercut und l'i in. I|?l. 'Bond*. Mond*. Bond*. Bunla. Boud*. Bond*. . Bouda. ad*. >.Honda. I'leuaoru lK7n 1877 18 8 1 <:??:! IAK9 ix>?7 l?i8M I?.v2 l.v.r. iH'.Mt IHH7 1SIN 1-71 IHrtl 18*'. 187.'. 1>7<i 187T 1878 1870 1887 1807 Total. 0 ?| \ B fl i i ?I &I8.kui ik) Mir. I Ml)' BKfjOOU 10 aoo.ouo on 2t??,nui UI .-??I.U >i ou gUI.OOU i?. JfO.Ueo 00 2oo,(oo no 2? 0,000 no 2.'.,O00 in U i.f-1 i ?I 484,444 ftl j itftfJJflO ut, 23n,UKI 00 n.floo oo 2IW.U10 eo 2IKI.oou lo. 2KJ.000 00 2iO,?jto BO hm.tr-. > RR 3laUgJQ i*i ;wfl,i(o no sll.llo no (Vi.l.14 SO 178.U48 Bt\ 4a,'.'Mi uo rV4.olU OUj liLva 7o. SH&71 uu 142.110 to. r:i...s;. no 23,440 00 Baa Neil st.i. in. in 2,ju> im 1,(100 oo 2.U00 (H>, S2/O0 tail :i.'.,|oj 00 :i.',.,e.i oo ?nejbao uij ?tnvtic oo jUUU 8U lsu,:!*.'. so IttJSsi rrr 1.M1.720 OO I4A.U0U UU 7S,74ti ji im?,4. ki oo o7 *no a?i? oo l.'.io 00 1-1 '.Ml 61 lls.ooo ui 24'.t,UlO on ll.Ooo 00 20n,non mi l'th.un UI 2UU,l'IU 00 200,lt)0 OU 1BS.U00 to :u?i.uoo uu Xi8,UO0 ik) iSo.olo.iHW Sa)t?SBtTiT SI ?212.000 ?of*l.T?,1.7n hi POST-RECONSTRUCTION BONDED DEBT. FIRST SUB-DIVISION. .Statement of Ante-Recount ruction Floating Debt ami Debt Fumlabte. under Ada September and December, IBM, Funded from L Auijitst 1, 1808, t? October, 187?. CLASS. Begbtered Stock Boada. Bond?. Bonda. Bonds. i>nd<. UNPKB WHAT ACT ISSUED FOB WHAT I'UBl'OSr.. n tr\\ |ll ' i ' 1 m i 8 C < a S. ? Scpt'lior ami D.-c'r, lKlMI.. Kuti.llng I'ant Hue Int.iui.i Hrlii.THIfll 0 ?f.'.J.flM \n Svpt'bcr ami Dec'r, lHflfl.. Funding P.iat Hue tat.mid Tiiit |H87| 0: ll.l.iKMi (o Sept'beraud Dec'r, lUCfl.i rtinding 1'itat Duelnt.und Pilo. I.-D7 i: Ul.UtO to Anguat 2(j, l8tw. Redemption tHlkUaM&frablc.... 18SS 01 Augiut 20, 1808. I'avm. i.l lUUrcal I'litdl. Debl..|!88S fl Sepuuiber 16, \WM,.!Fumllug Hllla Bonk Sfl.lc.18K8| 0 Total.. I-1-1-j?-1-? fflf.,87.1 41 B^vm en ?7,000 1*9/100 O^ao oo] foot! 82,tjui IVHUIOO 00 S?KVI0I) (JOi H^M) (O 78.1,410 041 7*5.410 Oil l/.'.)0,iKai (?)! l,2M),(i>.l uO ?70.41.1 04 HH.0UO on lOO.OUl UI 4*4.000 rio i T8A.4I0 flu T2,?00 l.iso.flon oo C0.4U) Oo WPUr\ 8280/^4 (r.':?2.87.'.,41? (Wi?2^4,4Hi Cflj $16?.77:i 4l|rMil UK)! ?1*4,0001 tJ,T4S.*.?o Co ?Printed by Muii>1iy'H Soiut, PbiUdelpllia, fin banda of Klnti>lou. Totitl Ktmdiag Stock Iaaueil, ft40,2S7X: Total Couvertpd, ?flfl,87:?.4!. Balance, 870,4 M 04 SECOND SUB- DIVISION. ilatement of Bonded Debt Created ? by llrconstructcd Uov rnment from August 1, 1868, to October, 187:5, and Bonds ami Stocks Issued to Vhungei Form of Bonded Indebtedness, GLASS. r Honda. Bond?. Bondt. flonda. HoikH.. UNDK It WHAT ACT ISSU K D. March 23. IMCO. Anguat SB, 18t?... rettruary 17, IN Hi. Marcft 2.1. lactf. March 27, SCO. March 1, IK70. Total. FOB WHAT I'lIIU-CSK. Conversion State Securllla*. ISSH A masent Int. Pnbllc Debt... ls*s n Relief of Treasury.jl*8S| 7, Obavanstou Stale Stvlirllirs.! 18881 Uj I. in.I Coliimlaaioli. 1888; Ol bop! Conimisalou.IlMSa. tV S.',.Vo.ion lai ' tl i, .s i .ti |604^S3 .1 1,100.110 no ko-.i.ixo to 8,.io,ioi) on r>,osr>,<sHi in i.c.ii, iSiOVSW (o ?o,<?o 00 OOO/lOO OtlJ fi4K),lX*> IN) r75,7WI I7II.70U : ?VI,iaKI 4.1 IKK) SSjIHkl 7H,IN?l 1..7.IOH ? tf4BMS*iBSS :?4 ?NA'iS.olM 34!Sg,HM7,9isi:tt,ir74,7?i ???.?O ?I^)10,ISS) Boojipn M,000 inl.toa :?????. fLMsa^ao ?I.47II.wsi ?1,'.8.:ilO fftM.MOO in) 1 1 411/413 ai 8.S0JNO ui sn.iNNi1 7.44J,ftou on 1s4.inni ini ;?41.1011 in) ?l,f.7'.,:i"o J-.l,241,(S?.H4 ?By traaifer. RECAPITULATION. ' Anle RueonttnuMlon Honde.1 Debt,oiitauiidlng Ocloluar, 187.1. Sa,7ftf.71S 41 l*oat-He<'oiiatrucUi>u H011d.1l Debt, Flrat Snu-Divlalon, oulatnn.liiig Ortolter, 1*73..,. 2,74H,s:vi Ut) ?Kst?Stnictlon Bonded Held Seccftvl Snt.-DHUI.m, otitalandlng o?uim, 1*78. n,T4i,n*.i ?4 Converted from Anguat 1,1*?.*, to October, 1873. t '1 :.7-M v.i Convettctl from Anguat 1, ISO*, lo October, 1873. 1*?,773 41 Converted from August 1.1*08, to October, 1*7-1. 1,174,700 00 Tout. Total. ..v..Jl?,iv-,1,027 36 f&pb lu cinreacjr was i*?J lo tu make even sum of f loo, aanoe real ajnoncl Ooovsnloa Bend* aad Stocks Usatsd taVt?v^0ta ^^HH^HoSaa^D^SaaaaaaaaaaaMB^BaaaaaaB ' '? ' ' iHhWijm m i It will be seen from tbe pfltofjding state menl that the bonded debt aggregates $1 851,027.33, or $300 more than tho amount reported outstanding on the 3lat of October, 1872. This dilfureneo is nccoufttcd for by the | issue on the 18th of November, 1872, of $300 ' fundiug stock under llie Act? of September and December, 18UG. It will also l>e Been that I huvo divided tlio debt into two historical periods, viz.: "Ante Reconstruction Funded Debt," or the amount of bonds ami stocks outstanding when tho reconstruction government assumed control, and " Post-Rcconstruction Funded Debt," or tho amount ol bonds und stocks which bear the signature* of tho officers of tho recon structed government This hjtfter debt has been subdivided as follows: Tafte first subdi vision shows the tlonliug debt/itrontracled by tho untc-reeoiistnicted governmsmt, which the officers of tho reconstructed government found outstanding when they camo into power, and which thoy converted iuto a funded debt by tho issue of bonds aud stocks; tho second subdivision represents the funded debt ac tually creatod by tho reconstructed gororn metit, und for which only thvy ore entirely responsible. histohy or TtiK nosonp nsirr. The stock kuown ns tho three por cents of 17D4, was issued for the purpose of funding certain debts incurred by tho State to aid iu carrying on the revolutionary wur. At tho close of the war tho United States govern ment assumed the debts of tho States, in curred in carrying on the war. Tho interest upon this dobt wits paid by the national gov ernment to the Slate, and the Stale disbursed tho amount so received to her creditors. When tho Bauk of the State was chartered in 1812 tho moneys received from the United States were turned over to tho bank aud formed u portion of its tlrst business capital. After u few years the I'm ted Stales paid to iho State tho entire principal of this debt, which amount whs also turned over to the bank, and it was made the duty of iho bank to pay the interest annually accruing upon these three per cents, und to redeem tho prin cipal upon presentation. It is. therefore, assumed that this debt is a prior lien upon tho assets of the bank. Tiiia stook is held almost exclusively by citizens of this State, having been in tbe ltossessiou of single families from generation to generation from 1794 to tbe present time. Tito Firo Loan stock, amounting to $303, 343.89, and Fire Loan Lends, amounting to $481,944 3], ure outstanding balances of an original issue of $2,000,000 uf bonds issued as a loan to rebuild tho burnt district of tho city of Charleston under act of .tune 1, 1838. The bonds are byld in Kuropo and matured in 1808. The Mock muluied in 1870 and is owned by ciluona of tho Unite** ??*?..??. In my opinion those bunds and stocks, amounting In the uggreguto to $785,288.20, which uro now past duo and payable, and ulso the throo per cents, making a total of $824,134, are not on actual, but a contingent, liability or tho Stale. The act authorizing the issue of tho " Fire Loan bonds" provides thai "it shall be the duty of tho President and Directors of the Bank of tho State of South t.'urolinn to make proper provision for tho punctual payment of the interest of auch loan us may bo effected upon tho credit of the Slate, under the provis ions of this act, aud also for tbe ultimuto redemption of tho principal thereof;" and. further, ihat when the profile of tho suid Bank of the State of Suulh Carolina shall huvo paid tho iiitorost on certain stocke aud re deemed said atocks (all of which, suvo the throe por cents, huvo boon redeemed lung since), for which thoy huvo heretofore boeu pledged and sot apart, the said prouls shall ubio bo considered solemnly sot apart for the payment of the interest or. the said loan und tho final redemption of tho principal thereof." The history of this loan is as follows : Tho $2,000,000 of bonds were issued to tin* Bunk of the Statu. Tho bank through its agent, General McDuKie, secured tho services of the Baring Hrolhora, of London, to nego tiate them. They succeeded in disposing of nbbul $1,000,000; the rewslndor wan returned to tho bank, coiiTPttod into registered stook, und sohl in tlio Sutoa. The proceeds of the sale of those bonds and stocks were dopoeilod in the bunk us a part of Its working capital. Persona desiring to rebuild tho burnt district of Charleston obtained a loau for that purpose from the batik', giving a mortgage upon the property as security for the loao. The bank received tho moneys from the sale of the bonds and stocks; it received the interest upon the loans mado to the builders; it re ecived the principal of the loans at their ma turity. In Jmtice, therefore, to the lax payers of tho Statu the assets of tho bank, which have repeatedly been solemnly pledged and set apart for tho redemption of thoao bonda and stock*, ought to ho immediately so ap plied. In tho report of th - officers of this institu tion to the Legislature of 1841 it is emphati cally asserted ?' that the it hole of tho means of Iho bank stand as security for this loau." The president of iho bank iu his report to the'Legislature or date July, 18G8, referring j to this subject, very justly observed " that it [ might ? |ih propriety bo regarded us a debt uf tho bank rather thau a dobt of the State. The bonds and slocks wore sold and the funds placed under control of tho bauk, which was charged with tho distribution of tho funds, and also tho duty of providing for tho pay ment of the Interest and principal of tbe obli gations as they became due." Tho Legislature, uuder act of December 21st, 1805, again pledged and appropriated tho assets of the bank?flrat to tho payment of tho Hre loan bonds in F.uropo ; second to the fire loau stocks iu America, aud third to the bills of tho bank. Tho Legislature, uuder act of Septembor 15th, 1808, disregarded this contract with tho holders of this loan, aud directed tho sale of the assots, uuder the direc tion of tho Uovcrnor, tho proceeds to be sub ject to the order of tho legislature ; and also authorized tho funding of tho hills issued prior to Decemlier 20. I sou. The sale of the assets was enjoined by tho courts, aud the claims of these several classes uf creditors are still the subject of litigation. The whole history of this loan, as read in the annual reports, both of tho officers of the bank and the comptroller-general, conclusive ly provos that tho interest on the loan aa it accrued, aud the principal as it matured, were mado a pi cl ot red claim upon the entire funds of tho batik. In 1843 the late C. al. Furmati, thou cash ' ior of Ute bauk, made a statement showing Ibo probable operation of the bank in tho payment of i|>9 publlo dsbt, in which he aliovred that on tho 1st of Juminry, 1870, af ter tho redemption of the last instalment of tho fire loan, there would be a balance of funds iu tho bimk to tlio amount of $'2,418, 027.35. I am aware that tho available assets of tho bank, according to the reports of tbe Legisla tive committee of 1838, appointed to investi gate this matter, if sold, would probably bo insufficient to cancel this ontiro indebtedness, vi/... $824,124; but theBo facts have been adduced to show that tbey should be so ap plied as far ns they will go, aud tho deficien cy, if any, cou'd attcrwurda bo provided for by tho Legislature. I repeat, therefore, that tho firo loan bonds and stocks and tho throo por cent, stock ore not actual, but couting.-nt debts of tho State. The actual debt is thus reduced to $16,027, 503.35. The aggregate amount nf bonds and stocks originally issuod under tbe several acta au thorizing tho issue of bonds and stocks for tho construction of tho new State House was $2,280,600. Of ibis sum $1,034,811.59 huvo Ixen cancelled, and conversion bonds issued in lion thereof, aud $212.000 have bceu redeemed, and $1,251,788.41 uro now outstanding in their original form, as wiU more fully appear by roferenco to the state ment of tho bonded debt. Tho faith and funds of Iho State are sol emnly pledged for the payment uf tho inter est aud principal uf this debt. Of tho amount outstanding $38,000 ol bonds of 1853 are past due, and no provision has boon mado for their redemption. The bonds originally issued under tho act of 1854, as m subscription to tho Blue Ridge Railroad amounted to $1,000,000. Of this sum $34,000 huvo bceu converted and con celled, aud conversion bonds issued iu lieu, and $U66,0U0 are now outstanding iu their original form. Unlike the bonds and slocks previously mentioned, no provisiou lias been mado by pledgo of the faith or credit of tlio Slate, or otherwise, for the payment of tho principal or interest of these bonds. Tho bonds aud stocks originally issued under tho nets of September nnd 1 Vcombcr, I860,'for funding the interest and principal of certain bonds and stocks past due, aggregnto $1,166,287.35, as follows : Borat? maturing in 1837. $?09.000 00 Uonila maturing In Isfl'i . 611.000 Ort Stock mat art ns in lbs7. 140,187 83 Tout.SI.166,247 So The total amount convortod wns $156, 673 41, ns follows : Honda maiming In lss>. S4V0O0 00 Uoiut? maturing In 1887. 4o,*.*o oo Stuck mal in Ine in l?sl. 60 STe 41 ToUt.S1&6.67H 41 Til" ?..'?..! b ,1. n,ilyl??.li-.b U .1.1.".ii. 613.04, as follows : mimt? maturing In 1887. $46*1,400 00 HoDiW matin line In lsl?7. 464.S00 00 stock manuring in l*?7. 7v,tia ?4 T"l?J. ?1.000,616 ?4 These two nets authorised tho funding of | the interest due upon the outstanding bonds und stocks to the 1st July 1367. amounting to $969,090.44 ; and ulso tho funding of the principal of the bonds of 1859, to aid tho Blue Ridge Railroad, due in 1865, amounting to $310,000 ; ulso buluiico of certain stork, amounting to $3,705.46, utaking a total amount fumluble of $1,282,801.90 ; total funded, $1,1(10,287,85: hulunco not yet fuuded, $110,514 55 ; additional amounts paid In by parties to make even sums of $100, or .s,u, $531.17 : less fractioual amounts relin quished by stockholders, $298.09 ; balance fundable $116.751.63. Tho bondu originally issued tinder tho act of August 26, 1868. to redeem tbe obligations known as tho bills receivable of the State, amount to $500,000. 'I ht-se bills were issued und. r an act of December. 1863. The amount redeemable under the act of 1869, wus $300, 000. Of this sum $298,702 were redeemed by ex-Trouatirer Purker, and $82 huvo been re deemed by the present treasurer, as cash on account of taxes ; tbero is, therefore, u balance outstanding of fcl.?l?. It appears, by tho reports of tho financial agent, that these bonds were sold for 70 conts on the dollar, realizing $350,000. I Tho total amount of bills redeemed by the pro- < vious administration was, sa boforo staled, $298,702 : Ihoro ought, therefore, to havo been a balance of cash to tho credit of this account on the 30lh of November, 1872, of $51,298. In comparing the aggregate receipts and ex penditures of the last administration, this amount is acoouutod for in the expenditure for genera! purposes, still 1 found it impossible to ascertain tho object of expenditure to which it wns actually applied. Puder thu ad ol August ?>(?>. 186 8, to au thorise a loan to pay interest upon the public dobt, the Am ilc'iu Bunk Kote Company printed $2,000,000 in two issues. The first issue uinouuted to $1,000,000. Oti account of some alleged omission, they weru not consid ered as saleable as were other bonds of tbe Slate. It was, therefore, determined to pre pare a second issuo of $1,000,000, and to retire and cancel the first issue. Of ssid issuo $500,000 were retired and do alloyed by burning, ss appears by tho certificate of five of the officers of tho exe cutive department; $50,000 were can celled aud are on file in the treasury ; $450, 000 were never retired, aud therefore exist as a debt of Die Ststo. The entire amount of the second issuo was also negotiated. The total debt created under this act thou amounts to $1,450.000. Of this amount $253,000 havo Inen cancelled, and conversion bonds issued hi lieu, and $1,197,000 are outstanding in their I original form. In order fo ascertain what proportion of this dobt is chargeable to the an ten count ruc tion administration, the following inquiries should be mado: 1st Tho whole period iu months from tho date the interest was last funded to tbe date to which the intorest was payable under this 1 act. from tho proceeds of tlio sale of these bonds. 2nd. What proportion of this period be longed to tbe aule-recoustructioB period, and what proportion to tho fioat-rceonst ruction period. The language of the set is rather ambigu ous, but taken in connection with tbe recoea mendation ol Governor Scott, in his first mes sage, \\ hieb recommendation it was the evi dent intention of tho Legislature to adopt, it appears that the proceeds from tho salo of these bonds were to bo applied to tho pay ment of interest on the public debt accruing from the 1st July, 1807, to 1st July, 1860, a period of twenty-four months. Tho interest accruing from July, 1867, to August, 1868, a period of thirteen mouths, is chargeable to the ante-recotiHtruetion period, and the interest accruing- from August. 1808, to July, 1809. u period of eleven months, is chargeable lo the post-reconstruction period ; or, iu other words, 13-24 of the endre deht of $1,460,000 ; amounting to $785,410 Cfi|. is chargiuhh? to tho former period, and 11-24, amounting to $604,683,334;, ia chargeable to tho latter pe riod. It may be proper to state, In connection with this auttject. that the Legislature, at Ha session of 1868-'09, appropriated $500,000 for the payment of tho interest due for this same period, so that there wero really two sources of income to meet this indebtedness. In comparing the amouui of moneys rccei. from taxes, with tho money a cx\ count of appropriations for this same jioriod, it appeara that the expenditures, exclusive of tho paymenU for interest, exceeded the re ceipta from taxes, and therefore, it is resumed that the interest wna paid from the remaining source of revenue, vir.: the proeeeda from thu aalo of these bonds. Under tho net of September 15, 1808, for fttnding the bills of the Bonk of the Slate, tbo American Bank NoteOotnpunv printed$1,500, 000. Of this ?um $1,259.000" wore issued, tho others were cancelled unused. Of the amount issued $69,400 werofon verted and $1,189,600 are outstanding in I heir original form. Tho bonds prepared tinder tbo act of February 17, 1889, for tho relief of tbo treasury, amounted to $1,000,000, of which $101,000 were nether issued, and aro caucelied and filed in tho treasury; $43,000 of the remainder have beeu exchanged for conversion bonds and $850,000 aro now outstanding in their original form. Tho stock originally issued mirier tho act of March 23; 1809, for the conversion of 8tato securities, amounted to $775,700; of which $711,700 bavo boon convorted into conver aion bonds. $0,000 represent stock transferred and $64,000 are outstanding in the original form. The issue of the conversion stock ia ex plained in this way: whoii application was mado to the treasurer by a pet son holding a bond of the State to havo the name ex changed for a conversion bond, tho treasu rer took up auch bond and issued iu lieu a piece of conversion stock of equal amount, which stock was thou cancelled aud exchanged for a conversion bond. This roundabout pro cess was prescribed by the net for tho conver sion of State aoenriti**. Several persona pre ferred to hold the conversion Ktock, and. there fore, did not carry the operation further, which accounla for the outstanding balance of $64,000 before referred lo. Of course this amount doea not represent an itiowv of the public debt, but merely represents in another form aomo pro ex Utting Obligation. au.? ??t? uMini nt X?-.7- :?.t? the said act for tho conversion ot State secur ities was $7,570,500. Of this sum $1,011, 600 were iaatiod merely to change the form of aomo pre-exiat'ug outstanding indebtedness, in thu form of bonds and stocks previously authorized, and henco do not represent an inereate of tbo public debt. The $34,000 of conversion bonds converted and caucelied arc thus explained. A. person holding $1,000 of bonds of dillbr out classes (s.iy funding interest, etc., $300 of the denomination of $100; funding bills Hank of tha State, $500 of tho denomination of $50, and conversion, $200 of the denomination of $100,) would present them to tho treasurer, and reeeivo iu exchange a piece of conver sion stock of lb* denomination of $1,000, and in exchange for said stock a conversion bocd of equal amount. Thus, $34,000 of conversion bonds found their way back into the treasury, aud bonds of the same class, but larger denomination, found their way into tho market without mortaring the volume of debt. I repeat, therefore, that there aro now out standing $1,677,500 of conversion bonds is sued in strict accordance with law, which n?e merely tbo representatives of bonds aud stocks of various clasaee, and, in tbo aggre gate, of equal amount cancelled and tiled in the treasury. This statement ia based upon my personal examination of said cancelled bonds aud stocks, and may bo relied upon aa accurate In every particular. There are also outstanding con vor? Ion bonds to the amount of $5,965,000, which repre sent an actual mcrratr of the public debt. It haa been alleged that thoso bonds were hypothecated for security ot loans, by order of the Financial Hoard, and the moneys re ceived therefrom used to cover the deficit of revenue from taxation, or lo ''bridge tbo chasm " between the receipts aud appropri ations, and tho State being unable to redeem the bonds at tho maturity of the loans, they wore forfaited and sold, aud thus, by the amount represented upon their face, iucreaacd tho public debt I will not venture to assert that these nllo atioos are entirely at variaiico with the facts, because I havo been unable to get access to tho records ol the Financial Hoard, or to ascer tain the exact time oaob particular loan waa negotiated, and tho amount thereof, us also iho amount of bonds forfeited for each loan the State failed to diacbargo at maturity. Hut this I assert with certainty, that more than ooe-soTCOtlt of said amount is accounted for in anothor war. It appeara, that on the Mb of December, 1870, tbo then treasurer of the State, in a letter addressed lo tho financial agent, (a copy of which is of record in the trcusui;.- ) stated that the Stale owod a debt o'' $303, 343.89, due hi 1870, known as Firo Loan Slock, and also a debt of $'260,000, duo in 1871, known aa Statu Capital Bonds, which debts the financial board had instructed him, tho treasuror, to discharge, with authority to j make whatever arrangements might be neces sary therefor. 11s accordingly placed in said ?gent's poeaeasion bonds for tbo conversion I of Stnto securities, amounting to $800,000, [ directing him to make such use of said bonds aa he might deem necessary to redeem said obligations. The sequel of this arrangement shows that $213,000 of Slate capital bonds have been redeemed, $203,000 by tho f.oancinl agent, and $9,000 by tins treasurer. Whethor tha entlie amount realised from tho aale or hypothecation of the said $800, 000 of oonveraiou bond* was barely sufficient to redeem the $212,000 of Slate capital bonds, (purchaseAble at that time at a price below 80 per cent.,) does not appear, in the absence of evidence to the contrary, and in asmuch ae (,? fire loan Ktock waa redeomed, it mny safely be assumed, that such waa actually the case. The bonds issued under the act of March St, 1869, for the purpose* of the Land Com mission, amount to $900,000, and under tha set of March |, 1870, for the same purpose, to $500,000, milking n total of $700,000. Of (he (Irrt inane $76,000 "nave been cancelled, and conversion bonds issued iu lieu, and of tbe Hccond issue $157,000 have changed their form in tbe samcm nui-r, leaving $407,000outstand ing in llieir original form. This concludes the history of the bonded in debtedness of iho State. I !.<;WIM, DKUT. Th? lab i cht ?lue em) (lajrabl* upon t Im bonded ilftit, on th? Siat of tlciotwr, < 1as appear* l>jr> th? treaaurwr** hooka, ; mounts to. SI,428,81?. 85 Tlio Intert-at iluo ami pntkUr- on tlit> Slat of October, ls;3, amount* U>_ tlSjBSt W 751.63, rundnble under Um acta of September ninl Docember. 1866, which may properly bo included in tho floating dobt of the State. Tho special committee appointed by Ute Legislature, session of 1872-7:t, to invest'gato the nmouut of outstanding pay certificates ami bills payable, reported that thoy had ex amined outstanding pay certificates and billa payable to tho nmouut of $401,869.98. The committee asked for further time to continue their examination, which was granted. It Is assumed that there is an additional amonnt outstanding, which tlte committee will prob ably examino and report upon at your present session. Tlio total amount outstand ing n ay be safely estimated at $500,000. It is u'.so estimated that there is an unpaid balance of pay certificates or the session of ll872-73, amounting to about $100,000. It appears by tho treasurer's booka that tho Stale :s charged with tho sum of $1,797, 362.94, on account of $3,395,000 of bonds surrendered by tho Blue Ridge Railroad in accordance witli the provisions of an act of tbe Legislature, approved March 2, 1872. There- is also upon the treasurer's book a largo miscellaneous floating debt, including unpaid lice school fund, and all unpaid ap propriations, not payable an deficiencies after October 31, 187:t, which is estimated at about $450,000. accArrrrumox. Inter, st open Domini Debt to October SI, ?SJ8.t*.84x,tt?I8 Debt laiohiM.- under Acts September and Decemlier, 1S&?.. 116,70188 Pay cerllrleates and bills nayabla sessions oC 1S70-71,1871-7*.. 500,000 00 l'ay certificates ?eaalon of 1S7*-7S.. 100,06006 Debt due Ulue Uldtfe Hallres.l. 1/1*7,802 94 MUcrlUnums Mooting Dtbt. 450,000 00 Total.?4,606,807 7S Funded Debt.115,027fM $5 Flucti Dg Debt. S^06,S97 75 AsRrrs?U Floating and Kunde?! Dobt .. .6tD^3&,?el 10 The passive, or do-nothing policy whjch lias outntneu In tuo ireaviiieiii oi tue piiuiie Idobt, since 1871. haa unquestionably proved disastrous to the credit of tbe State. Tbe tax payer,' relieved for tho time being I front the payment of an extra tax, regarding Ithe bondholder as a parasite, living at tho ex pense of forced i-on tri but ions from his small laud insuflicioiil revenue, "reaping whore he hue not sown,'' lias been disposed to lot the* Idobt and tho holders thereof take care of themselves; hoping that some beniflcent providence would ultimately rolieve Aim of I the burden; curing litlio whether relief came from repudiation or .the assumption nf the debt by iho uulional government. But in the meanwhile iho unpaid interest accumulates; ibe probability of the assumption of our debt by the national government is remote; threats - of reptidiutinu begin to assume tangible shape* and citizeus are found bold enough to give them utterance; tbe bonda of tbe State are no longer enquired for nt tho stock oxchange; tho credit of the Stale is lost almost beyond redemption. It is patent to the unprejudiced mind that unless wo propose to adopt in thia State that policy which haa made tbe name of tho one* proud Stute of Mississippi infamous in the commercial markets of the world, stach prompt, immediate action is imperatively demanded aa will demonstrate to the creditors of the State our honest determination to adjust and settle our ontiie indebtedness according to our beat ability. No one doubts that to levy at this time a tax large enough to cancel our floating indebt edness, or even to pay the accrued and accru ing interest upon the bonded debt, would paralyze iho business energies of the State, and would be equivalent to an actual confiscation of tbe property of every citizen. To fund tbe whole of the floating debt at par would increase the public debt of tho State. Thia ia expressly Fcrbidden by a recent amendment to tbe constitution, unless two thirds of the qualified electors of the State, voting upon the ques tion, should give their assent to such increase. F.von assuming that their assent to such increase could be obtained, iho present condition and resources of the Stato do not warrant tho collection of an annual tax oi about nine mills on tho dollar, in addition to all other taxes, to pay interest upon tho public debt. Tbe question thou arises what Is to he done under tho circumstances ? There are these who even object, atrenuously, to the levy of any tax nt all for the present to pay interest; but tee must either pay or repudiate. If from ..'.innary 1871 to October 1073 does not furn ish the tax payer a sufficient breathing spell to prepare tho way for the resumption of the interest payments, then three additional years with all their interest accumulations will not oflbrd it. But I am satisfied that this class of grumblers comprises but a small minority of the lax payers of tbe State. They would grumble whether tlte tax bo one mill or ten. Taxation is considered an evil always to si ui titled; but there are evils murh %torse than that. The loss of credit, public and private, the continuation of such aoUon as will bting discredit upon tbe fair namo of tbe State and cloud tho honor nnd ultimate good intentions of iho people with imapteion of dishonorable repudiation. History is pregnant with illus trations of the fact that such a remedy is far worao titan tho disease. It is Irrelevant to ear present purpose to reflect tipw? ?kj way the debt has been contracted, or to estimate what consideration the State received in return. Tho debt exists, ami sound public policy demands that kmm provision be made at once for its adjust raent. Tim language of the treasurer of North Carolina in his annual report of November, 1872. applies with peculiar forco to the present condition of affaire in thht State. I can do tv> better tlisn quote his words and recomv-aowi their careful perusal and consideration: " I much fear, while. I do not opproheee?