Lane,) if we agree to pay the .same aggregate
amount of interest, whether we pay it in fifteen
years or in thirty years. The question then was
not the payment of the public debt, because the
conversion of the bonds, no matter in what man-
ner, does not extinguish the debt. But, Mr. J
said, the only one was, whether we should post-
pone to a longer period of time, the payment of
the debt, by the purchase of three per cent. or
other less rate of interest than the six per cent.
bonds. He agreed with the gentleman from Ce-
cil, (Mr. McLane,) that it was better and safer
to let the present system continue as it now works.
Mr. J. said he should be in favor of authorising
the Legislature or Treasurer to borrow, upon
short lime, sufficient funds to pay off any deficit
which might arise on account of the interest.
Mr, CHAMBERS congratulated himself on the
fact, that the distinguished gentlemen who had
spoken on the subject, had concurred in the
views he had the honor to submit a few days
since, as to the propriety of a vigorous effort to
pay off the public debt as promptly as possible.
The amendment of the gentleman from Charles
only authorises the Legislature to re-issue bonds
when it can be done at the par value of the ex-
isting debt. There cannot be more than a mil-
lion at six per. cent. exchanged for a million at
the reduced per cent. The only objection to
this conversion of stock from a larger to a smal-
ler interest, seemed to be that the period limited
for the discharge of the new debt, might be ex-
tended to an unreasonable length,
However the valuation of money and other arti-
cles might fluctuate, there could be no difference
of opinion as to the advantage of paying a small
rate of interest in preference to a large rate. If
on the very same! day one man receives six dol-
lars for his one hundred, and another receives
three for his hundred, most certainly the receiver
in one case gets double the value as well as dou-
ble the sum for the use of his money. Of course
no holder of a bond bearing six per cent., would
exchange it, for a bond of the same security at a
lessor interest, unless extension of time or some
other element to increase its value was offered
as the inducement. The bonds at six per cent.
could therefore only be converted when at matu-
rity, for stock on time at a reduced rate of inter-
est.
But we have now some portion of our public
debt actually due, and payable at the pleasure of
the government, and more might become due at
a period which would allow an issue of new
stock, at lower interest, on reasonable time,
without extending the period at which the large
portion of the debt is redeemable. Why not al-
low the government the advantage, in the mean
time, of converting the portion of the debt actu-
ally due into stock bearing less interest? Every
one who heard his remarks a few days since,
would know his earnest anxiety to get rid of the
public debt at the shortest possible period, yet he
could perceive nothing in the proposed plan which
was in collision with this view, provided there
was a reasonable limit to the credit to be given
on the new stock. He therefore would offer, and
ask the gentleman from Charles to accept, a pro- |
vision by which the new stock should be redeema-
ble, at the pleasure of the government, not later
than seven years after it is issued,
Mr. MERRICK wished to say one word on the
subject of the limitation proposed, upon the time
the new stock would have to run. He thought
it objectionable, for the reason that it would im-
pair the value of the new stock in the market, and
would not be productive of any good effect
whatever. If that state of the money market we
anticipate should arise, this new stock, if negoti-
ated at all, can, consistently with its objects,
only be negotiated when interest shall be at a very
low rate, suppose about three per cent. It can
only be at some such low rate, the arrangement
as contemplated by the amendment, of pay ing off
a stock "bearing a high rate of interest, by the
issue of a similar amount of stock bearing a low
rate of interest' can be accomplished If this
end be accomplished, and your six percent, stocks
redeemed, and your stocks outstanding bear in-
terest only at the rate of three per cent , there
will in the event of future fluctuations causing a
rise in the value of money, be no difficulty, if the
State has the money, in redeeming this three per
cent. stock, though its redemption be not stipula-
ted for in the bonds; the very change in the values
adverted to will make this redemption easy—for
the reason, that if money becomes more valuable,
say worth six per cent. a year. State bonds bear-
ing only three per cent., must fall below par-, and
therefore, if the State should have the means of
redeeming them, at a time when this state of
things exists, they can be purchased by your fis-
cal agents below par, and thus another large pro-
fit or saving may be made for the State.
Mr. CHAMBERS asked if his friend from Charles
did not see, that if money rise above par just at
the moment when the State is called on to pay
its bonds, it would have to pay more than par lor
them. These fluctuations are sometimes sudden
and always unavoidable in any market.
Mr, MERRICK said he would authorize the Le-
gislature to issue bonds bearing the lowest rate of
interest. No one calculates that the interest of
money is going to fall so very low as one or two
per cent. We know its oscillations are continu-
ally going on. This amendment looked to noth-
ing more than to authorize the Legislature to
borrow at the lowest rate of interest, to pay
off a debt bearing a high rate of interest. All
that he now sought for was to compare opinions
with other gentlemen, and then to adopt the plan
which in the view of the Convention would be
the wisest.
Mr. McLANE replied. His remarks will be
given hereafter.
Mr. SPENCER read the proposition of his friend
from Queen Anne's, (Mr. George.) and referred
to the amendments and arguments since present-
ed, and contended that if the amendments were
adopted, the legislature might authorise the pay-
ment of one bond of a million, by the substitution
of another bond of the like value, and appropri-
ate the money in the treasury to other purposes.
The proposition of his colleague requires it to be
appropriated to the discharge of the public debt |
