United States Treasury note

“ Thus a great deal of the paper money in circulation is issued by the national banks, which must, on demand, be redeemed with coin, and, in case of failure of the banks, are paid by the government, which reimburses itself from the deposits. A bank-note differs from a Treasury note in two particulars. The Treasury note or "greenback" is a promise of the government, and is legal-tender in payment of all private debts; the bank-note is the promise of a private company, and is not legal-tender. A bank-note is said to be paid when the bank gives a greenback or coin for it. ”

“ Every fair and legal effort has been made by the Treasury Department to distribute this currency among the people. The withdrawal of United States Treasury notes of small denominations and the issuing of small silver certificates have been resorted to in the endeavor to accomplish this result, in obedience to the will and sentiments of the representatives of the people in the Congress. ”

“ The small amount of Treasury notes, not exceeding $4,500,000, still outstanding, and less by twenty-three millions than the United States have in deposit with the States, is composed of such only as are not yet due or have not been presented for payment. They may be redeemed out of the accruing revenue if the expenditures do not exceed the amount within which they may, it is thought, be kept without prejudice to the public interest, and the revenue shall prove to be as large as may justly be anticipated. ”

“ We are now without any medium; and necessity, as well as patriotism and confidence, will make us all eager to receive Treasury notes if founded on specific taxes. Congress may now borrow of the public, and without interest, all the money they may want, to the amount of a competent circulation, by merely issuing their own promissory notes of proper denominations for the larger purposes of circulation, but not for the small. Leave that door open for the entrance of metallic money.... The State legislatures should be immediately urged to relinquish the right of establishing banks of discount. ”

“ The rising credit and financial strength of the United States would, it was believed, bring them to par without injustice to the debtor, but the rapid withdrawal of the notes would add to the burden of debts and cripple all forms of industry. It would convert the compound interest notes and treasury notes bearing seven and three tenths per cent. interest, amounting to over $1,000,000,000 expressly payable in United States notes, into coin liabilities. The bill prepared at the treasury department contemplated the conversion of all United States notes into bonds. ”

“ In that year, Congress enacted a law authorizing the Treasury to withdraw the greenbacks from circulation. The paper money party set up a shrill cry of protest, and kept up the fight until, in 1878, it forced Congress to provide for the continuous re-issue of the legal tender notes as they came into the Treasury in payment of taxes and other dues. ”

“ He proposed to fund at seven per cent the outstanding Treasury notes, amounting to $18,637,000; and even after thus sweeping the field clear of pressing claims, he still required the extravagant war-taxes in order to meet expenses, and depended on a further issue of Treasury notes, or a loan, to support the peace establishments of the army and navy. The state of the currency was desperate, and the revenue for the year 1815 was estimated at $18,200,000 in the notes of State banks,—a sum little in excess of the estimated civil necessities. ”

“ The United States note, to the extent that it is willingly taken by the people, and can, beyond question, be maintained at par in coin, is the least burdensome form of debt. The loss of interest in maintaining the resumption fund, and the cost of printing and engraving the present amount of United States notes, is less than one-half the interest on an equal sum of four per cent. ”

“ I am convinced the only thorough and practicable remedy for our troubles is found in the retirement and cancellation of our United States notes, commonly called greenbacks, and the outstanding Treasury notes issued by the Government in payment of silver purchases under the act of 1890. ”

“ Nearly $8,000,000 of Treasury notes are to be paid during the coming year in addition to the ordinary appropriations for the support of Government. For both these purposes the resources of the Treasury will undoubtedly be sufficient if the charges upon it are not increased beyond the annual estimates. No excess, however, is likely to exist. Nor can the postponed installment of the surplus revenue be deposited with the States nor any considerable appropriations beyond the estimates be made without causing a deficiency in the Treasury. ”

“ Financial measures, of various kinds, for borrowing money to supply the wants of the treasury, beyond the receipts from taxation and the sales of the public lands, have been adopted by the government since the United States became an independent nation. Subscriptions for a loan of twelve millions of dollars were, on the 4th of August, 1790, directed to be opened at the treasury, to be made payable in certificates issued for the debt according to their specie value. ”

“ Under existing legislation it is in the power of the Treasury Department to maintain that essential condition of national finance as well as of commercial prosperity--the parity in use of the coined dollars and their paper representatives. The assurance that these powers would be freely and unhesitatingly used has done much to produce and sustain the present favorable business conditions. ”

“ They are also to serve as depositories [Pg 100] for the United States government, and to issue treasury notes obtained from the Federal Reserve Board in exchange for rediscounted commercial bills, these notes to be redeemable on demand by them and to be a first lien on all their assets. Their retirement, when the need for them has passed, is provided for by the requirement that no Federal Reserve Bank shall pay out any notes except its own, all others being sent in to the issuing bank or to the treasury for redemption. ”

“ We believe that a United States note, issued directly by the government, and convertible, on demand, into United States obligations, bearing a rate of interest not exceeding one cent a day on each one hundred dollars, and exchangeable for United States notes at par, will afford the best circulating medium ever devised. ”

“ To throw upon the treasury the possibility of the necessity of buying coin to pay the interest of the public debt, in addition to buying that which is necessary to maintain resumption on United States notes, is simply to overload the wagon and break it down at the very start. ”

“ And so much of any unappropriated money in the Treasury as may be necessary for that purpose, is hereby appropriated, for paying the principal and interest of said notes.
Appropriation.Sec. 9. And be it further enacted, That a sum not exceeding twenty thousand dollars, to be paid out of any unappropriated money in the Treasury, be, and the same is hereby, appropriated, for defraying the expense of preparing, printing, engraving, signing, and otherwise incident to the issuing of the Treasury notes authorized by this act. ”

“ They abound in countries where no other currency is allowed. In our own States, where small notes are excluded, gold and silver supply their place. When driven to their hiding places by bank suspensions, a little firmness in the community soon restores them in a sufficient quantity for ordinary purposes. Postage and other public dues have been collected in coin without serious inconvenience even in States where a depreciated paper currency has existed for years, and this, with the aid of Treasury notes for a part of the time, was done without interruption during the suspension of 1837. ”

“ They are redeemable in gold and silver on demand at the places of issue. They are receivable everywhere in payment of Government dues. The Treasury notes are limited to an amount of one-fourth less than the estimated annual receipts of the Treasury, and in addition they rest upon the faith of the Government for their redemption. If all these assurances are not sufficient to make them available, then the idea, as it seems to me, of furnishing a sound paper medium of exchange may be entirely abandoned. ”