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Remarks on Treasury Notes,
in Congress, June 23, 1862


   Mr. STEVENS. Banks are excellent things; yet, if you get one of their notes you cannot pass it beyond the town in which it was issued. If you can, you have better luck than I have. I got one from Pennsylvania, and I could not pass it at all; and yet I dare say that it was as good as any one of those I have heard praised. The truth is, these one dollar bank notes are not known beyond their local circulation. It is desirable that our soldiers should be paid in something that will pass all over the country   

   It is desirable that they should have notes when they are paid at the White House and desire to go home, to Pennsylvania, New York, or New England, which they can pass as well anywhere fifty miles from where they got them as at a place where they received them. They cannot do it now, and what is the result? Either the Government must buy gold, and pay it out in sums below five dollars, or these poor men will have to take these notes of the banks which they cannot pass beyond the neighborhood where they had been manufactured.  If we have to buy gold, as we have, one result is that gold will rise. The other reason is that we have to buy gold with which to pay interest upon our bonds. I think the Government might as well pay its own notes as to buy gold at the premium which is now ruling. I think we had better use these notes in paying our soldiers, than have the paymasters pay them in the notes of the local banks where the paymasters respectively reside. A paymaster residing in York, Pennsylvania, gets the small notes of the York banks, good at home and redeemable there, but not known when you get south of the Potomac.

    Therefore it is we are paying off these poor men in what to them is a nuisance, and are buying gold and paying just what the bullion dealers choose to charge the United States. I want to get out of that condition of things. I am now speaking to the amendment upon which I am now about to ask a vote.

   As to the general principles of the bill, if I could hear one idea which was not advanced at the time of the last argument upon this subject, I may say a word of acknowledgement of it, for, so far as I am concerned, I had not many ideas then, and I have got fewer now, I believe, for they have run out, {Laughter.}

    Mr. MALLORY. I desire to inquire of the gentleman from Pennsylvania ---Not with a view of advancing a new idea, for he has announced that almost impossible from the discussion we have heretofore had upon the subject --- whether he, as chairman of the Committee of Ways and Means, can give us any assurance that this is the last batch of notes of this description the Secretary will call upon this House to authorize him to issue?

    Mr. STEVENS. After we shall have got through with the amendments, I propose to say a few words generally upon the merits of the bill, and then I will answer the question which the gentleman propounds to me now. I  will, however, now say that if the system which is at present pursued of depositing notes and never converting them into bonds, and which has prevailed since that vicious deposit system upon interest was forced upon us by the Senate and outside of the Senate, shall continue, I do not know where there will be an end of this issue. I cannot see it. I am not responsible for it.

     Mr. Mallory. One Question more. We all know the intimate relation subsisting, and which must necessarily subsist, between the manager of the Finance Committee of this House and the Secretary of  the Treasury. We all know that the distinguished gentleman must be aware, to a great extent, of the opinions and purposes of the distinguished member of the Administration to whom I have alluded; and I respectfully inquire of the gentleman from Pennsylvania, in view of that fact, whether he knows that the Secretary of the Treasury does or does not contemplate an additional demand on this House for a further issue of Treasury notes?   

   Mr. Stevens. I have no knowledge that he intends to ask for authority to issue any more. I may say to the gentleman from Kentucky, that, while I have great respect for all of the opinions of the Secretary of the Treasury, we do not agree upon financial questions exactly, and we cannot harmonize any more than I do with gentlemen around me. I do not know his views. I had hoped the business would be so conducted that no more would be needed. I do not believe the issue will be injurious; but I do believe a repetition of it might bring us to that. I shall say a few words upon the subject hereafter. At present I am speaking to the amendment; and I now move that the committee rise for the purpose of closing the debate upon the pending amendment.

    [After a brief interruption to consider another bill, the House approves Spaulding’s amendment]

     Mr. Stevens. I move to amend the substitute by striking out form the word “and,” in the eighteenth line, to the word “therof,” in line twenty-nine, as follows:

    And any holder of said United States notes depositing any sum not less than fifty dollars, or some multiple of fifty dollars, with the Treasurer of the United States, or either of the Assistant Treasurers, shall receive in exchange therefor duplicate certificates of deposit, one of which may be transmitted to the Secretary of the Treasury, who shall thereupon issue to the holder an equal amount of bonds of the United States, coupon or registered, as may by said holder be desired, bearing interest at the rate of six per cent. Per annum, payable semi-anually, and redeemable at the pleasure of the United States after five-years, and payable twenty years from the date thereof.

   I will explain the reason why I make this motion. The provision is not in the draft of this bill as sent to the House in the communication from the Secretary of the Treasury, and I do not very well know how it got into this bill, unless it was copied from the old bill, in which it was. By this provision, any man holding demand notes and legal tender notes can deposit them at par, and compel the Secretary of the Treasury to issue twenty years bonds at par to them. It leaves no option, For some time past, if it had not been for that provision in the former law, the Secretary of the Treasury could have sold these bonds at about five per cent. Advance. They have borne a premium to that extent. This has, therefore allowed speculators to take these legal tender notes and demand six per cent. Bonds, which were five per cent. In value above the notes. There was no discretion in the Secretary of the Treasury to refuse it period. By striking this out we should leave it discretionary with the Secretary to exchange the bonds at such a price As they are worth, and do not compel him to exchange them at par for a currency which is below the value of the bonds themselves.

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