Mr. HOOPER, of Massachusetts. Mr. Speaker the great importance of the bill now before the House, an the interest excited in regard to it, arises from the fact that it is the 1st measure in reference to the finances and money of the nation which has been presented to Congress since the change of circumstances following relief from the war under which the country has labored for the last 4 years. The action of Congress upon this bill will probably be consider egis an indication of their opinion in regard to policy to be pursued. The subject is of vital consequence to the interests of every one. I propose, in the remarks I shall make on this bill, to review the action of the Government during the past 4 years in ref erence to this subject, and to make some suggestions in regard to the action which seems to me to be required in the present condition of our finances. Success in the great conflict in which our country was suddenly involved by the rebellion—the preservation of the Union, the maintenance of the Government and the authority of the laws being the issue at stake—require an expenditure far exceeding in magnitude any which has been knQWn in the history of our own or of any other nation in an equal length of time. It was unexpectedly necessary to pro vide for the raising, equipment, pay, and sustenance of a gigantic army and of a power ful navy. The formation of such an army and navy, in view of the scanty organization then existing, was little less than their creation. Their materials of war and of subsistence were required to be on a scale wholly unexampled. Oiiior nations may have done as much, perhaps, through a lung and varied experience and in view of enemies more remote. Our armament was required on the instant, as our enemy was on and even within our threshold. This unprecedented exigencv required that the nation should look for other and deeper sources of revenue than those to which it had been accustomed in times of peace; and it became the duty of Congress and of the Treasury Dept to devise and sanction measures by which the necessary revenue could be obtained to meet this vast expenditure with the least hardship to the people and the least strain upon the credit of the Government. In considering these measures it was fully recognized that the end aimed at could not be attained without sacrifices on the part of the people which would entail inconvenience and give rise to great diversity of opinion. It was the part of wisdom and patriotism and the du of every one to submit c eerfully to such sacri ces as the proposed measures required, instead of attempting to excite popular clamor so as to weaken public confidence in the Government, on whicli) all rely for the safety of their persons and the security of their property. It was the manifest duty of all loya persons to support those measures, unless they could show that the object of them could be effected with less hardship and inconvenience by other methods than those proposed., There was no difficultyin finding men for an army which numbered a million soldiers in the field. The country abounded with ever thing necessary for their equiment and subsistence. Never in authentic history has such an aggregation of men, of supplies, and of transportation been required and provided. The problem forced upon the consideration of Congress was how to pay this armed force, with their equipment and maintenance and transportation. There were but 2 methods by which this could be equitabl and efficiently accomplished. One was by taxation; that is, by callinv on every member of the community to furnis at once his just proportion of the amount required for such expenditures. This every one will now admit would have been so onerous as to be impracticable. The other method was to provide the money by loans; that is, by using teobligations of the Government to pay at some future time, with such rate ofinterest as may be agreed upon; thereby casting upon those who come after us a portion of the burden of a debt in curred in securing results of which they, even more than we, will receive the benefit. The loyal people throughout the country were everywhere rea iy;to be taxed to an extentsufficient to secure the prompt payment of the interest on the loans and to provide for the payment, of the principal within a reasonable term ofyears. It was a readiness founded on intelligence. Unaccustomed as the country then was to raise such large amount rof money by taxation, it was impossible to devise means by which the enormous expenditures required could be met in that method; and if possible it would not have been expedient. Congress accordingly adopted the other and the only measure which was possible. The necessary laws were enacted, as required from time to time, to provide by loans for the equipment, subsistence transportation, and pay of the Army and hnvy; and taxes were providedthat secured the prompt payment of interest, and for the principal of the loans within a reason able terms ofyears. According to the estimates of the Treasury Dept, and the actual results of the 1st half of the present fiscal year, the revenue of the Government from the existing system of taxation, and from other sources, will not be less than $500,000,000; while the annual expenditures for the fiscal year ending the 30th one, 1867, including the interest on the public debt, is $284,317,181 88. It is apparent, therefore, that the present rates of taxation will, under any circumstances, yield an amount of revenue much in excess of what is necessary to secure the amount required for the ordinary expenses of the Government, the interest on the public debt, and a reasonable appropriation for its extinguishment within the lifetime of many of those who now hear the burdens of this taxation. Congress having determined thatAhe menus to carry on the war should be raised by loans, authorized the issue of bonds for the amounts required, bearing interest at an annual rate not exceeding 6%., payable half yearly. There would have been no difficulty in rely.ing upon these bonds alone for adequate means to carry on the war until the rebellion was sub dued, if the creditors of the Government, in eluding those who contracted to furnish the necessary supplies, had been the parties who could hold the bonds they received in payment from the Government. But unfortunately these parties had generally incurred large debts to enable them to fulfill their engagements to the Government, which they were obliged to pay. They wore often put to great inconvenience, and the credit of the Government was often greatly impaired by the frequent, though unavoidable, delay of the Treasury Dept in making payment. To obviate this difficulty the SecyTreasury was authorized by Congress to issue a“nd ay to the creditors of the Government U.S. notes” not hearing interest, but which were made a legal tender for all debts, public or private, except for interest on the public debt and for duties at the customhouse on foreign importations. It was believed that in the usual course of trade these notes, thus paid to the creditors of the Government, would e by them transferred to their creditors, and pass from one to another in )ayments, until they came into possession of banks and capitalists; and that. an excess of them which could not be used with profit in the usual chan nels oftrade would be returned into the Treasury in pament of the interest bearing bonds. Aftert O suspension of specie payments by the banks throughout the country near the close of the your 1861, the question presented itself whether the Government should use the irre deemuble notes of the suspended State banks, thereby, in violation of law, sanctioning their use as money, and encouraging their issue to an unlimited extent, or should avail itselfof its own credit to furnish a currency, secured by a pledge of the public faith, to meet the wants of the community and facilitate the payments for the enormous demands which the war imposed. By the suspension of specie paymehts the irredeemnble notes of the banks became the only medium in circulation as money for the payment of debts. While those notes were re deemable in coin they possessed a standard of value, but they had no standard of value after the suspension of specie syments. If the Government had received those notes in payment for taxes and for loans, they could not have discriminated between the different banks by arbitrarily rejecting the notes of one as bad and accepting the notes of others as good, but would have been obliged to receive and pay the notes of any and every banking association in the country. No one now, who considers the amount of money that was required, and the condition the country would be in at this time, if this large amount of money had been furnished in the notes of the State banks depending for their security solely on the solvency of those banks—a solvency impossible to be tested so long as the suspension of specie payments continued—can doubt that Congress rightly decided in authorizing the issue of the legal tender notes, secured by the pledge of the national faith. The emergencies of the war rendered it necessary for the national Government to avail itself of all its resources to meet the demands of the public service. The friends of the Government claimed for it the right to furnish the paper money for the curieney of the country as a fruitful source from which the pressing needs of the Treasury could be supplied. It was just and right to demand it for tacommon benefit and the comnwn welfare; and no one who considered the claims of the public service to be superior to the claims of private interest. could urge any sound argument or.reason against complying with this demand. Most of the w who opposed this measure talked about a car rency of coin, which they know was impracticable; and they presented, as objections to the issue of the Government notes, r notations from the different writers on finance in favor of a currency of coin, as if the problem to be solved was what constituted the soundest and best money for a commercial country, when the real question was in regard to the best mode of meeting a great and pressing emergency which sud enly arose and endangered the very existence of the nation. The legal tender money was authorized us a temporary measure, forced upon the Government by the exigencies of the war. "he losses and the inconvenience caused by the depreciation of the money of the country, in consequence of the addition of the IQ l tender notes to the circulation, were certalnl greater than was expected by those who ini tinted and advocated the measure; partly because the war assumed a greater magnitude and a longer duration than was then expected. Great as the depreciation was at one period, if the price of gold may be considered an indication of its extent, there is every reason to suppose it would have been far greater if the irre deemuble notes of the State banks had been used by the Government instead of the legal tender notes. Many believe that it was only the pledge of the national credit and the faith of the loyal people in the power and stability of the Government which prevented so large an amount of paper money being repudiated and becoming worthless. Nothing short of an absolute necessity, such as the war of the rebellion created, would warrant nny Government in subjecting the people to the evils and dangers inherent in an irredecmable paper currency. In consequence of the depreciation of the currency, as indicated by the rise in the price of gold and silver, the coin of the smaller as well as of the larger denominations ceased to circulate as money; and to meet that evil it. b“ecame necessary to authorize the issue of the fractional currency," socalled, to represent the fractions of the paper 10 l tender dollars. As the war progressed an demands against the Government accumulated, it was deemed requisite to provide other forms of obligations, in addition to those beforementioned, to obtain money and facilitate the payment of those de mands. The issue of Treasury notes was therefore authorized, payable in 3 years, with interest semi annually, in current money, at the rate of 7 and 3 10ths% or an num, convertible at the option of the holder, when due, into 6%. bonds of the class known as “ 5twenties,” the principal and interest of which are payable in coin. Another form of "reasury notes was also authorized, bearing interest at the rate of 6%., to be compounded and paid with the principal in 3 years from their date. These notes, for their face value, ( not including the accrued interest.) were made a legal tender in payment of all debts, exceptinterest on Government bonds, import duties, and redemption of notes issued by banks for circulation; and they were paid as money from the Treasury to the creditors of the Government. Authority was also given for “certificates of indebted ness” to be issued to creditors of the Governmentnt, ayable in one year, with interest at the rate O 6%.: being in effect similar to what are known in England as “ Exchequer bills.” Another form of certificates was also authorized for “deposits oftemporary loans," payable with interest, either on demand, or inten days from demand, after 30 days from the date of deposit. upon these different forms of obligations all e money, beyond what the revenues furnished, has been provided for the payment of the vast expenditures of the Government during the war. The extraordinary demands upon the Treasury growing out of the war have now been so far paid that the ordinary revenues, from taxation and Otherwise, will probably be sufficient hereafter to meet all the ihst demands against the Government; and therefore it is unnecessary to provide for any more loans." it may be well to recapitulate the statement of the different forms of obligations which now represent the debt of the country; and also to state the amount of debt existing in each of those forms on the 1st January, 1806: Bonds. the l and i terest ayable in i;. $1, 130586.70000 Lczal tende no,: oludingtho fractional currency,not hearing interest. 7 and 3 10ths Treasury notes payable in 3 years and convertible at maturity into 6%. bonds. L e altender compound interost Tlrcasury notes. bearing interest payable with the principal 3 years from diite. i. Certificates of indebtedness.payable one year from Wlil! interest. certificates for deposit.of temporary loans. payable with interest on do mand or inten days fromdemand, after 30 days. 50,667,00000 Amount of the war debt. Adding other Government debt Total debt January 1, 1866. "$2,800.Ofl21799 I At the same time there was in the Treasury in. 845,733,65600. 00 38,447,41000 Add. in currency., 11 Total amount to the credit of the U.S.in the Treasury. 883,440,68810 During the four yeais ofwar $2,749,491,745 87 has been provided by loans, and a system of taxation was established increasing the annual revenue of the country, which never amounted to $75,000,000 before the war, to at least $500,000,000. All this has been done without any serious derangement thus far of the trade of the country or any serious inconvenience to the people. I venture to assert that nothing can be found in history to compare with this. Never before, within the some space of time, has so large an amount of money been raised by loans, or so efficient and productive a system of taxation been established. During the administration of Mr. Chase, as SecyTreasury, and by the agency ofhlessrs. Jay Cooked. Co., the 1st popular loan was effected, consisting of $500,000,000 of the 5 20 bonds, This was followed with even greater success afterward, thrdugh the same agency, under the administrations of Mr. Fessenden and Mr. Mc Cullocli, by disposing of $830,000,000 of the 730 Treasury notes. The measures by which this has been accomplished were instituted while Mr. Chase was SecyTreasury, and no essential change of those measures was made by either of the distinished gentlemen who succeeded him in the Treosury Dept. There were other agents, however. than those before referred to who rendered powerful aid in negotiating these loans. Our generals, with the brave armies under their command, did more to insoire public confidence and establish the credit of the Government than all the other agents who were employed to dispose of the loans. Whatever differences of Opinion may exist in regard to what has been done, no one can doubt now, the war being ended and the Government having ceased to be a borrower of money. that the important question to be considered is, how to restore the currency to a sound and stable condition at the earliest prac ticable time with the least possible disturbance of the value of property and of the substan tial interests of the industry of the country. A sound and stable currency is equally important to the whole community, and the interests of labor demand it. It is essential that every one should know what value is represented by the money they receive, and that its value will not fluctuate. nor be regulated according to the action of speculators in gold or merchandise. The people have a right to claim that the money they are obliged to use should have an intrin sic and, as far as possible, a permanent value. Gold and silver are the standard representa— tives of value throughout the civilized world. Do what we may, and issue what we lease as money, its value will be regulated by testandard of gold and silver. When we say that gold is at forty%. premium, it is only another form for stating that the paper dollar is but little more than 71 and 1/3rd cents in gold or silver. If the " U.S. notes" are to constitute the only money of the country, and their amount be increased to $1,000,000,000, as has been proposed the value of that dollar would mainly be regulated by the standard of coined money in the commerce of the world; and at the same time the value of such a currency would hcconstantl fluctuating. Recklessspeculations have of late been more often based upon the abil—ity to reduce those fluctuations, than upon the usual at unavoidable incidents which influence the rise and fall of the prices of property under any system of mone, When, in consequence of the suspension O specie payments, the irre deemable notes of the banks became the only medium of circulation for the payment of debts, the standard of value was given up. Since then the money of the country has been constantly fluctuating, and in all the rest cities, and more particularly in the city of fiew York, eat num liers of people have made it their on ybusiness to operate on the hopes and fears of the public to produce a rise or fall in the price of the paper money as compared with coin. Another proposition has beenput forth, which I am told originated among certain Jews in the city of NewYork, to debase the coinage of the country—a practice often resorted to in former ages by European monarchs to defraud the community. The proposition would have attracted little attention had it not been that the opponents of the Government indorse it, and through the agency and with the sanction of a minority report from a board of commissioners created by the last Congress, have presented to the public a specious argument in its favor. The only honest and practical way in which the paper money of the country can be restored to a sound condition, and made equal in value to the money of other countries With which we are connected by commerce, is by a gradual eduction of its amount until what remains shall circulate as the equivalent of coin and can )e converted into coin at the option of any holder. As soon as the contraction of the amount of “ legal tender notes” is commenced in earnest, an no other aper money allowed O be substituted for it, the premium on gold will decline and foreign exchanges will be in our favor. If the public understand and believe that the contraction is to be continued until the uper money remaining in circulation, whether issued by the Government or by the banks, is at par With coin, the export of specie will cease, the product of our gold and silver mines will be retained in the country, and gold will be imported from Europe. Vhenever the paper money is at par with coin, both will then circulate together a sin “and constitute the money of the country. The banks can then resume specie payments. The gold which has accumulated in the Treasury may then aid in the resumption; the coin paid for the interest on the public debt will no lou er be boarded by those who receive it, but be e positedin the banks, as in former times; and the excess of gold which has accumulated, beyond what is required for payment of interest, may be paid to the banks for the certificates of tern orary deposits in the Treasury, which the ban s of the large cities now hold and use to make their daily settlements at the clearing house. With coin substituted for those certificates, and so longas the banks continue to hold the same amount in coin as they now hold in those certificates, there seems to be no good reason why it may not be as easy to settle their balances in coin as it is now to settle them with the certificates. In former years, before the suspension of ipecie payments, the banks in the city of NewYork rarely held $20,000,000 in coin. The average amount of specie in all the banks of the U.S. for 5 years prior to the suspension of speciclpaymcuts in 1801 was about 80 million do ars; and previous to that period it was usually less than 60 millions. how there are nearly 70 millions of coin in the sub Treasury and in the national banks; and whenever it is determined to resume specie payments this amount of coin will be largel increased from the boards now held by individuals all over the country. I do not wish to be understood as advocating an immediate resumption of specie payments. Even if I thought it practicable I should not deem it at once advisable. Time must be taken, to (prepare for it; but the preparato steps can I: on should be commenced now. he coplel should understand that in the opinion O congress the policy should be adopted of reducing gradually the amount of paper money until its value is restored and made equal to that of coin. The length of time which may be required to accomplish this is dependent on circumstances that Congress can neither foresee or determine. But it seems to me the dut of this Congress to adoptsome policy which will indicate then intention, and brin about resumption at the earliest period in which it can be accomplished without affecting injuriously the great interests of the labor and capital of the country. The 1st step in that direction, in my opinion, should be to exchange the interest bearing legal tender notes for long bonds, and at the same time to reduce the rate of interest on tern, orary loans to at least 4 or 5%. his reduction of the rate of interest on tem porary loans would enhance the value of cor tificates of indebtedness, which bear 6%. interest; and, being payable at a period fixed by the Treasury Dept, they are a more convenient form ofloau, while at the same time they provide a mode of anticipating the revenue at times when it may be needed. When the interest bearing egal tender notes are withdrawn, and their amount funded, there would remain of aper money in circulation beside the nationahbauk notes, only the U.S. notes and the fractional currency, which bear no interest. Before reducing the amount of those Government notes by converting them into interest bearing bonds, it should be considered how far the circulation of bank notes, which are equally paper money and equally effective in causiu its depreciation, ought to be restricted; and whether the banks, also, may not assist undeontribute in the work of restoring the money of the country to a sound condition. When the only unfunded obligations of the Government are the legal ten or notes and fractional currency, costing nothing for interest, we can more easily determine to what extent and when they shall be withdrawn from circulation. They now constitute a fund orlonn amountin to over 450 millions, wi out any cost to the Government for interest. They constitute a loan from the people; and before I consent to their conversion into bonds that will require the addition of $27,000,000 to the annug pay incnts for interest, I wish to know how mnc benefit is to be derived by assuming so large an increase to the amount. of interest we now have to pay, and also for whOse benefit it will be. I have always believed that the action of the banks has had, and will continue to have, as much effeet in depreciating the value of the pay or money as any action of the Government; t on h it may be said that, at 1st, the necessities of the Government provided the occasion for the banks. If aper mone is convenient and desirable, while the privilege of furnishin it is of such great value, it may be questione whether the lGovernment can afford l5 resign the privilege to others, and particularly at this time, when it is so desirable to diminish ratherthan to increase, the amount of taxation. To withdraw only the interest bearing legal tender notes may appear to be insufficient for the purpose of contracting the currency; but, l knowing, as I do, the use made by the banks of this class of notes, in belief is that it will prove more restrictive than is generally supposed; and particularly so if the amendment of the banking law, which has been referred to the ComBanking&Currency by a resolution of the House, should be adopted to prevent those notes being included as lawful money in the reserves which the national banks are obliged to hold for the redemption of their liabilities. The law which authorized their issue provides that any Treasury note bearing interest shall not be a legal tender in payment or redemption ofan notes issued by any banks. They are a sort of ybrid, part loan and part money, and are not new used as money to any extent, except by banks that count them in either of their anomalous characters, and use them as a basis for extending their own issues. The foreign exchanges are now in favor of this country, as shown by the fact that while the actual par ofexchange on London is about 9 per ccnt. the nice currents quote it as selling in NewYork: at 7%. for bankers bills, and as low as four%. for other bills. If the present remium on gold could be relied upon, orif the dollar of currency re presented a dollar of gold, it would be profit able to send exchange to England to import coin. Having myself twice seen the experiment made in this country of resuming specie payments, and in both instances without producing any disturbance of business, I have not the apprehension expressed by some in regard to the effect it would now have on the business of the country, if effected at the proper time and ju diciously conducted. I believe that specie payments could be sustained now with a much larger amount of notes convertible into coin than formerly under the system of State banks as it existed in many arts of the country. It has been said thatt O “ U.S. notes” and the “fractional currency” took the place of the coin which had previously circulate. It is very certain they did not displace the bank notes, for they have increased in amount in stead of being diminished since theissue of the U.S. notes. While the supply of money was regulated by the State banks t iere never was, in my opinion, a suitable amountof money for the proper conduct of the business of the country. It seems to me that the Treasury could resume specie payments without regard to the banks; and that the U.S. notes could be continued in circulation as the equivalent of coin. after specie payments were resumed, and until there was a snficient amount of coin in the country to supply their place. The “ U.S. notes” would be more convenient for use within the U.S.; and, so long as the foreign exchanges were in favor of this couu try, there would be no legitimate demand upon the Treasury to redeem the notes in coin. During the past 4 years the great objectin all the financial bills before congress has been to provide means to carry on the war. That necessitdy having passed, no more loan bills are require. It is our duty to be cautious in determining upon the changes to be made in the regulation of the money of the country, involy in, as it does, the value of all property, and afiecting the interest of every one in the community. My chief objections to Withdrawing the U.S. notes from circulation by converting them into bonds are, besides the expense that would be incurred for interest on the bonds, my belief that a larger amount of money than formerly is now required for the business of the country, and my fear that some other paper money, not so good, may be allowed to take their place, by which the country would be further than ever from a currency convertible into coin. The loan bill passed by the last Congress, approved March 3, 1865, empowered the Secborn of the House such number of Iluuse bill NO. 207, SecyTreasury to issue bonds of any description authorized by that act for the purpose of converting into such bonds “any Treasury notes or other obligations bearing interest issued under any act of Congress.” This is the power which the SecyTreasury has now. He is authorized to issue bonds for any period not less than 5 nor more than forty years from their date, the rate of interest not to exceed 6%.; but only for the purpose, of converting or funding other interest bearing l obligations. The bill under consideration proposes to amend that act so as to enlarge the power so for as to permit the SecyIreasury, when he deems it expedient, to convert obligations not hearing interest; and also to dispose of any of the bonds, either in this country or in Europe, for the purpose only of retiring other obligations; but not for any increase of the public debt. This amendment authorizes any of the bonds dis osed ofin any foreign country to be expresse and the principal and interest paid, in the currency of that country, but provides that the rate of interest on them shall not exceed 5%. I understand that the Secretary does not expect to use this power, but deems it important that it should be given to him to be exercised only in case circumstances may arise that, in his opinion, would render it advantageons and exedient. The power to borrow money under the act of last year is exhausted; and the amendment of that act preposed by this bill does not authorizean new loan, its only object being to facil itate the funding of existing obligations.