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COLUMBUS,iriIIIWDAY, NOVEMBER 1, IS*> S .
MESSAGE.
executive” DEPARTMENT,)
Millkdgeville, Nov. 3, ISSB. J
Fellow-Citizens of the {Senate
and House of Representatives:
It affords me much pleasure to be aide to
state that the financial condition of the coun
try is greatly improved since the adjournment
of your last session. Previous to that time,
the commercial crisis, aggravated by a general
suspension of specie payment by the banks ol
many of the States, including most of the
banks of this State, attended by d!strust and
loss of confidence, had depressed the spirits
of our people, and seriously affected all the
great interests of our State.
Banks and Banking.
On the 22d day of December last, both
branches of the General Assembly, passed, by
a constitutional majority, without Executive
sanction, an act entitled “an act to provide
against the forfeiture of the several bank char
ters in this State, on account of non-specie
payment for a given time, and for other pur
poses therein named.” This act made it the
duty of the Governor to withhold proceedings
under the act of 1840, for the forfeiture of the
charters of such banks in this State as had
violated the law, and were in a state of sus
pension, until the 15th day of this present
month, or till the happening of certain contin
gencies mentioned in the act.
In view, doubtless, of the great imposition
practiced upon the people by the banks, in
taking from them usury under the name of ex
change, and otherwise, the usury laws of this
State, so far as applicable to banks, were
changed by the eighth and ninth sections of
said act; by which it is made illegal for any
bank or bank agency, by itself, its officers or 1
agents, directly or indirectly, to loan money at
a greater rate of interest than seven per cent,
per annum, and at that rate only for a longer
or shorter time; or to discount or purchase
notes, papers, or evidences of debt, at a greater
discount than seven per cent, per annum. —
And all notes, bills, drafts and contracts, of
every sort whatever, taken for money loaned
at a greater rate of interest than seven per
cent., as well as all notes, papers, and evi
dences of debt, discounted or purchased in vi
olation of said act, are declared to be utterly
null and void, and irrecoverable in law.
The tenth section of’ the act regulates the
per cent, which a bank may receive for ex
change, when its own bills are tendered at its
counter in payment therefor, by a citizen of
this State.
The sections containing these provisions
were doubtless inserted in the act for the pur
pose of protecting the people against the usu
rious and exorbitant exactions of the banks.
And to prevent, as far as possible, violations
of the act, in the particulars above referred to,
it is enacted by the eleventh section, that,
“ The affidavit of bank officers to their annual
and semi-annual reports, shall, in all cases,
state that the bank of which they are officers
has not, by itself, its officers or agents, in any
particular, violated the provisions of this act.
Afod the twelfth section makes the offence per
jury, should bank officers swear falsely in ma
king their reports. By requiring of bank olfi
cers the solemn guaranty of an oath, under
heavy penal sanctions, that the law has not
been violated by them, the Legislature no
doubt believed they had protected the people
against such illegal practices in future.
Although 1 withheld my sanction from the
act on account of other objectionable features
in it, and on account of the doubts I entertain
ed as to the constitutionality of portions of it,
I have no doubt but that such portions of the
act as prohibit the taking of usury by the banks,
and regulate the manner of making their an
nual and semi-annual reports, which apply
alike to all banks in the State, are both consti
tutional and expedient. Entertaining these
views, on the Ist day of June last I issued my
proclamation, calling on the banks to make
their returns according to law, and to comply
with said eleventh section of the act of 22d
December, 1557. As this act had been passed
by the Legislature mainly for the relief of the
suspended banks, and at the earnest solicita
tions of their friends, I had reason, in common
with all law-abiding citizens of the State, to
suppose that they would render cheerful obe
dience to all its requirements. It is with much
regret, however, that I have to state to the Le
gislature, that by far the greater number of the
banks whose suspension had been thus legal
ized, and whose charters had been so recently
relieved from liability to forfeiture, in open vi
olation of the statute passed for their relief, as
well as all the banks in the State which had
not suspended, either neglected, or openly re
fused to obey the law, and make their returns
as directed by the positive mandate of the
statute; thereby placing themselves in a posi
tion of defiance to the constitutional authori
ties of the State.
In this state of things I issued my proclama
tion, as required bylaw, publishing the names
of such delinquent banks, and notifying the
Treasurer of this State that their bills would
not be received in payment of taxes, or of any
debt due the State or the Central bank, until
they should comply with the laws and make
their returns as directed by the statutes; and
this they have hitherto neglected to do. It is
evident therefore, that the penalty of exclud
ing their bills from the Treasury, wlifch is the
only penalty now prescribed by law for a fail
ure to make their returns, is not sufficient to
compel obedience to the requirements of the
statutes. Doubtless some of the banks have
made more by taking usury, and by disregard
ing in other respects the act of 22d December
last, than they have lost by suffering the pres
ent penalty for not making returns in accord
ance with existing laws.
For the purpose of compelling these corpo
rations to yield obedience to the law in future,
I respectfully recommend that the penalty for
disobedience be increased, and in addition to
the penalty already prescribed, that a tax of
two per cent, a month upon the whole amount
of the capital stock mentioned in the charter
of each delinquent bank, be levied and col
lected in gold and silver, for the entire time
during which any such bank may in future re
main in a state of disobedience, and fail to
make its returns as directed by the statutes.
There can be no just reasons why wealthy
corporations should be permitted at their plea
sure to set ihe law at defiance, while individ
uals are compelled to sutler rigorous penalties
lor its violation. The mandates of the law
should be obeyed as promply and implicitly by
the most influential and wealthy as by the
poorest and most needy. This is republican
equality, and our people should be content
with nothing less.
No sooner had the act of 22d December.
1557, been passed, than the banks, forgetful of
their promises to expand their circulation, to
discount freely and relieve the country, re
fused to discount notes, however good, when
offered to them in a legitimate course of bank
ing business, or to extend accommodations to
any except perhaps to a favored few, such as
cotton buyers and other speculators. Mer
chants and others, compelled to have Northern
exchange, were generally unable to obtain it
for less than three per cent. The price of cot
ton declined, and monetary distress became
general throughout the State.
The banks having thus abused the generous
confidence reposed in them by the Legislature,
continued to enjoy the benefits of the suspen
sion long alter the banks of the great cities of
the North and West had resumed specie pay
ment, and until the just indignation of an in
jured people, expressed through the public
press, by public meetings and otherwise, be
came so prevalent that they felt compelled by
fear of future consequences, to retrace their
steps and curtail the speculation they other
wise would have made out of the suspension.
They therefore prepared to resume on the Ist
day of May last; thus admitting, by their re
sumption six months in advance ot the time
fixed by the statute, that no such necessity as
they represented to the Legislature ever did
exist for the passage of the act. A gentleman
of o-reat ability and worth, who is at the head
of one of the most important and influential
banks in the State, in his report of May last,
while apologising for the suspension, and re
ferring to the fact that the Legislature had
given time till the 15th November, says: “Our
banks, impatient under the supposed odium of
suspension, resolved to resume on the Ist of
the present month,” (May.) It is a fair infer
ence, therefore, that the banks would have
continued the suspension till the time fixed by
the act for them to resume, but for the pres
sure of public opinion, and their impatience
“under the supposed odium of suspension ”
Public opinion having thus compelled the
banks to resume before the lime fixed by the
statute, and the crisis having passed, we, as
rational men, should learn wisdom by experi
ence, and try to provide as far as possible
against abuses of their privileges by these cor
porations in future.
1 presume it will not be denied by any one,
that we have erred by a too liberal and un
guarded grant of corporate powers and privi
leges to moneyed monopolies. And it is be
lieved that a future extension of this policy
would soon enable these monopolies to con
trol the government of Georgia, and make the
people the subjects of their power. It is al
ready claimed by some, that they now have
the power, by combinations and the free use
of large sums of money, to control the politi
cal conventions and elections of our State,
and in this way to crush those who may have
the independence to stand by the rights of the
people, in opposition to their aggressive power.
I trust that the bold, independent and patriotic
people of Georgia may never be compelled to
bow the neck in subjection to the yoke thus
intended to be imposed by the corporate pow
ers of the State. Let it not be forgotten, how
ever, by those who have watched with anxi
ety the growing power of corporate influence
that the price of republican liberty is perpet
ual vigilance.
The monetary and commercial afl'airs of the
country must necessarily remain subject to
panics, under heavy pressures, at certain, if
not frequent intervals, as long as our present
banking system is continned with its enormous
powers and privileges, which have been en
larged and extended by legislative enactment,
chartering new banks from year to year. The
people should take this subject into serious
consideration, and pronounce upon it a calm
and deliberate judgment. Every intelligent
person must admit that it is impossible for a
bank having a paper circulation three times as
large as the amount of its specie, to redeem
all its bills in specie on demand. Should all
its bills be presented for payment at any one
time, and the specie be demanded, it can then
redeem but one third of them. In that ease,
if the bank has sufficient assets, or property,
the other two-thirds may possibly not be an
ultimate loss, but payment must be delayed
till the money can be realized by a disposition
of those assets and property, which may not
be till the end of a lengthy and uncertain liti
gation. It is clear, therefore, that our present
paper currency is not a currency convertible,
at all times, into gold and silver upon presen
tation ; and that only one-third of it, should
payment be demanded on all at one time, can,
in the nature of things, be so convertible, so
long as the banks issue three dollars in paper
for one in coin.
In my judgment no paper currency is safe which
is not so regulated as to be at all times readily con
vertible into gold and silver. It is true, our peo
ple, by n, sort of common consent, receive the bills
of the banks and use them as money though in re
ality they rest upon no solid specie basis. But
sad experience has taught us that such a circula
ting medium subjects the country to panic at the
first breath of distrust or suspicion, which may be
produced by the failure of a single bank having a
large circulation and extensive connections with
other banks, and may widen and extend to the
prostration of the credit of the whole country.—
Such a currency, having no solid specie basis, can
be available only so long as the community will
consent to receive promises to pay money in place
of money itself.
The people take from the bank their bills as mo
ney. The banks receive interest, and often ex
change, upon them. When required to redeem
their bills in specie, they suspend, if they choose
to do so : and then, if an attempt is made to coerce
payment in specie, they resist it, holding a rod
over the people by threatening to make them pay
upon a specie basis debts contracted by them for
the bills of the banks; notwithstanding those bills,
when they received them, rested on a basis of only
one third specie. The high perogative of exercis
ing banking privileges, and of issuing their own
notes or bills to be circulated as money, not rest
ing upon any solid specie basis, is secured to the
banks under our present system of legislation as an
exclusive right, while the exercise of similar priv
ileges upon like terms is denied to all individual
citizens of the State by stringent penal enact
ments.
The privilege of using their own notes as money,
gives to the favored few who enjoy it, immense ad
vantages over their fellow citizens, and may often
enable the managers of these corporations to amass
great wealth by their high salaries and large prof
its. It may, however, be said, that many of the
stockholders are widows and orphans; that the
stock is in the market for all, and that the divi
dends are not greater than the profits realized from
other investments. This may be admitted. In
deed, it seems in practice to be generally true,
that the corporate privileges do not result so much
to the benefit of the mass of stockholders as to the
benefit of the few who manage the corporation. —
To estimate correctly the profits made out of the
people by those engaged in banking, we must not
only count the dividends of seven, eight or ten per
cent distributed among the stockholders, but we
must also take into the account the banking houses,
Teal estate and other property purchased out of
the profits of the bank and held by tlie corporation.
Besides, we should consider a reserved fund of 2,
3 or 4 hundred thousand dollars, made up of ac
cumulated profits, and often kept back by our lar
ger banks and not distributed among the stock
holders, together with the high salaries of all the
officers of the bank, which must be paid before any
dividends are distributed. These sums though
made out of the people by the banks, are not
semi-annually divided among the stockholders.—
To these add all sums paid to attorneys, agents,
tfcc., and all amounts lost by defaulting agents,
which, wile they cannot be set down aS profits of
the corporation, sinee neither its officers proper
nor its stockholders are benefitted thereby, are still
sums of money, which under the workings of the
system, are drawn by the corporation from the
pockets of the people.
To all this add tlie large sums lost almost every
year, on account of broken banks, whose bills are
left worthless in the hands of the people, who
have paid full price for them as money. And take
into the account the further fact that the State, in
184 Sand 1549, issued $515,000 of her bonds to
meet her liabilities on account of the Central
Bank. $240,000 of which are still outstanding.—
And that in 1555, she issued $45,500 of bonds to
pay her indebtedness on account of the Darien
bank, which are still unpaid, making $285,500 of
bonds on account of these two banks which still
remain a portion of the public debt, the interest
upon which is paid annually out of the taxes of
the people—and we may form some estimate of
the amounts which the people of Georgia hare
paid and continue to pay in taxes, and suffer in
losses, to sustain the banking system.
Again, in many instances, those who control the
corporation may have great advantages in being
able, if they choose, to obtain such aeeommoda
i >ns as they may desire, by the use of its funds,
when a favorable opportunity for speculation oc
curs. The dividends pai l to stockholders are there
fore no proper criterion by which to judge of the
advantages of the corporation to those who hold its
offices, and control and manage its capital und its
operations; or ot the sums lost by the people on
account of the workings of the system.
Thus far I have discussed this question upon the
supposition that the liabilities do not exceed three
dollars for every one of specie actually on hand in j
the banks to meet and satisfy them. Thissuppo- ■
sition is more favorable to many of the banks than
facts will justify. The law of their charters only
requires that their liabilities shall not exceed three
dollars for every one of capital stock actually paid
in, and not three dollars for every one of specie on
hand to meet those liabilities. As an illustration
of the error of our present legislation in incorpo
rating banks, suppose the amount of the capital
stock of the bank be limited by the charter to
$500,000, which i3 to be paid in, in gold and sil
ver, by the stockholders. The charter then pro
vides that the liabilities of the bank shall at no
time exceed three times the amount of the capital
stock actually paid in. The stockholders pay in
the $500,000 in gold and silver. The directors of
the bank may then, without any violation of the
letter of the charter, incur liabilities against the
bank to any amount that does not exceed $1,500,-
000 ; and that too, without any obligation on their
part to keep in their vaults the $500,000 actually
paid in, or a like sum. If they should take out
8400,000 of their specie and invest it in real estate
or other property, leaving but SIOO,OOO of specie
in the vaults, they may still contract debts to the
amount of a million and a half, and may point in
triumph to the language of their charter, and to
the fact that the $500,000 of capital stock was
once actually paid in, as their authority for so
doing.
This bank legislation of our State does not seem
to have been well understood by our people. —
They have generally believed that our banks, by
the letter of their charters, were required to have
on hand at all times an amount of specie one third
as large as the entire amount of their liabilities.
The banks have understood the matter very differ
ently, und have not only claimed, but exercised the
right when they regarded it their interest, to ex
tend their liabilities far beyond three dollars for
every one of specie actually on hand to meet those
liabilities. By examination of their returns made
to this Department in October, 1857, it will be
seen that at the time of the late suspension of our
banks in Augusta and Savannah, the liabilities of
one of them for bills in circulation and individual
deposits exceed thirteen dollars for every one dol
lar of both specie and bills of other banks which
it then had on hand. Another had only one dol
lar in specie in its vaults for every fifteen dollars
of its liability 4 for bills in circulation and depos
its. Another had not one dollar in specie for every
seven of liability for bills in circulation and de
posits. And another had only one dollar in specie tor
every eleven dollars of its liabilities of the charac
ter mentioned above. It is true these banks had
other assets, but those assets were not money.
The question naturally suggests itself, how can
such a currency be convertible into gold and sil
ver —the money of the constitution —on demand
or presentation ? How can a bank with fifteen
dollars of cash liabilities for every one dollar in
specie, or even of five dollars for one, pay its lia
bilities promptly on demand ? It is impossible.
And how can its bills be justly considered safe as a
circulating medium, or as money , if it cannot re
deem them promptly on demand ?
In consideration of all the imperfections and
abuses of our present banking system, I am of
opinion that we should do all in our power to bring
about its complete reformation, and if this be not
possible, we should abandon it entirely. I am
the advocate of no harsh measure that would either
violate the legal rights of the present corporations,
(however unwisely they were granted,) or that
would bring distress upon the people, by a sudden
return from a paper to a specie currency. A re
formation so radical, if attempted, must be the
work of years. If the legislature would continu
ually refuse to charter any new bank, or to en
large the capital stock of, or re-charter afty bank
now in existence, the system would gradually work
itself out by efflux of time; and we might, with
out any sudden shock, return safely to the curren
cy of the constitution, plant ourselves upon a firm
specie basis, and rid ourselves of a system against
which the great and good men who conducted the
revolution and formed our constitution intended to
guard their posterity, when they declared in
the Constitution that nothing but gold and silver
coin should be made a legal tender.
In two of the States of this Union banks are
prohibited by constitutional provision; two others
have no banks, and another had but two small
banks, whose charters, it is said, have been forfeit
ed by the late suspension. And I am informed
upon what I consider reliable authority, that the
late commercial pressure was comparatively but
little felt within the limits of those States.
Should our people determine, however, to con
tinue the present banking system, and to charter
new banks, increasing their number and thereby
increasing their power in the State, I would re
spectfully urge the importance of guarding ail
charters with much greater stringency in the fu
ture. Let the charter of each provide that the
entire liabilities of the bank shall, at no time, ex
ceed three dollars for every one of specie actually
in its vaults and bona fide the property of the
bank, on pain of immediate forfeiture. Let the
simple fact of suspension of specie payment render
the charter absolutely null and void. This would
deter them from engaging in such wild specula
tions an over issues as compel them to suspend in
case of pressure. Let provision be made that all
executions issued against the corporation may be
levied upon the property of any stockholder until
the creditor be satisfied, leaving the stockholder to
his legal remedies against the rest of the stock
holders to enforce contribution among themselves.
Let the bills of the banks in the hands of the peo
ple at the time of suspension, bear interest from
that time till paid. And let the Legislature re
tain the right, by express reservation in the char
ter, to alter, modify or repeal it at pleasure. In
my opinion it would be best for the Legislature to
refuse to grant a charter to any corporation for any
purpose whatever without retaining a similar pow
er, should its exercise be required by the interests
of the State or the public good. If the corporation
is unwilling to trust the people with this repealing
power, how much more should the people be un
willing to trust the corporation without it.
Prohibition of Small Bills.
Several of the States have already passed laws
prohibiting the emission by their banks of small
bills. I once entertained doubts whether our Le
gislature could do this without a violation of the
chartered privileges of the banks; but on more
mature reflection .and careful examination, those
doubts arc entirely removed from my mind. I
therefore recommend the passage of a law prohib
iting the emission of small bills by the banks of
this State, and forbidding, under heavy penalties,
the circulation within this State of bills of a like
denomination issued by banks of other States.—
Such an act might prohibit the circulation of all
bills of a denomination under ten dollars, after
twelve months after the passage of the act, and
those of a denomination under twenty dollars in
six months thereafter, or at such other stated times
as might be thought best, so as not to embarrass
the business transactions of the country. The ef
fect of such a law would be to cause small bills to
be withdrawn from circulation, and as they must
be redeemed by the banks with specie, the specie
would go into circulation in their stead. This
would cause gold and silver to take the place of
bank bills in all the smaller business transactions.
The laborer would then receive the price of his la
bor in gold and silver, the farmer of small means
would generally receive the price of his produce in
gold and silver, which would remain good howev
er much bank bills might depreciate.
Sub-Treasury System.
I also beg leave to call the attention of the Gen
eral Assembly to the propriety of establishing by 1
law a system for our State similar to the Sub-trea
sury system of the United States, the wisdom of
which has been fully demonstrated by the benefi
cial results of its practical operation. I earnestly
recommend the adoption of such a system. Let
all payments into the treasury, after a reasonable
time to be fixed by the Legislature, be made in
gold and silver, and let the State pay the interest
upon her publie debt, the salaries of her officers,
the per diem of her Legislators, the money due the
several counties for school purposes, together with
all her other liabilities, in gold and silver. 0-
course the system should go into operation graduf
ally. This, in connection with the prohibition of
the circulation of small bills, would keep out of
the banks and in circulation among the people a
large amount of coin, placing the currency upon
a much more solid specie making the people
more independent of banks, and enabling them to
withstand the shock with much less injury in case
of a commercial crisis and bank suspension. It is
believed that no serious-incouvenience could result
to the tax payer from such a law, as the gold and
silver paid into the Treasury by those indebted to
the State, would be returned by the State in the
payment of her debts due to her creditors, and
would again go into circulation among the people.,
| Should any inconvenience be apprehended in the
transportation of specie from the treasury to the
| creditor, provision might be made authorizing cer
i tificates of deposit to be issued, which might be
| paid to the creditor, at his request, in place of the
coin. These certificates of deposit might be of
such denominations as the Legislature may pre
; scribe, handsomely engraved upon steel plates,
which plates” should be deposited in the Treasury
; for safe keeping. Each certificate might be signed
i by the Treasurer and countersigned by the Seerc
! tary of State, with the impression of the great seal
of the State stamped upon it, and a register of the
issue of each kept in the Treasury to prevent coun
terfeit. These certificates might be made payable
to the person to whom they first issued, or to bear
er. They would supply the place of bank bills so
far as the conveniences of a paper currency are
concerned, while they would be subject to none of
the fluctuations of value and the uncertainties of
bank bills. They would be taken at the option
only of the creditor in place of gold and silver. —
The gold and silver, dollar for dollar, would, when
they were in circulation, remain in the vaults of
the Treasury to redeem them when returned to it.
These certificates, thus predicated upon coin in
the Treasury, dollar for dollar, would be receiva
ble in payment of taxes or of any debt duo the
State. They would be a safe medium of exchange,
! and would, to the amount of their issue, be a pa
per currency at all times convertible into gold and
silver upon presentation at the Treasury. Each
dollar of paper would have for its basis a dollar of
specie in the Treasury, and as the faith of the
State would be pledged for their redemption, it
would be impossible for any citizen to sustain loss
upon them. They would be a currency at all times
and under all circumstances of uniform par value.
This would render the government of the State en
tirely independent of all banks and bank agencies,
and would in a very great degree destroy the pow
er of the banks over the people, while it would
give the people gold and silver change in all their
small transactions, and a paper currency perfectly
secure in many of their larger ones.
The suggestions made by the Secretary of the
Treasury of the United States, (Mr. Cobb,) in his
lato report to Congress upon the subject of the es
tablishment of a Sub-Treasury system by the
States, similar to that of the United States, and
the prohibition of the circulation of bank bills un
der the denomination of twenty dollars, are, in my
judgment, founded in wisdom, and commend them
selves to the serious consideration of the Legisla
ture. The State of Ohio has already shown her
appreciation of the wisdom of these suggestions,
by transferring much of their substance to her
statute book, allowing sufficient time for the grad
ual inauguration of the system into practical ope
ration.
Western & Atlantic Rail Road.
For a statement of the present condition of the
Western & Atlantic Railroad, its operations and
incomes for the fiscal year ending 30th September
last, I beg leave to refer you to the report of Dr.
John W. Lewis, its able and efficient Superintend
ent, who has shown himself to be a most vigilant,
active, and valuable public servant. In passing
this well merited compliment upon the faithful
Superintendent, I would do injustice to his asso
ciate officers, and the other agents and employees
of the Road, were I to fail to express my entire
confidence in their integrity and business qualifi
cations, and to commend the zeal and energy with
which they have exerted themselves for the success
of the Road and the advancement of the best in
terests of tno State. For their efficiency, fidelity
and integrity, they have my sincere thunks, and
are, in my opinion, entitled to the thanks of the
whole people of Georgia.
Owing to the commercial pressure, and the con
sequent stagnation of trade and business, the gross
incomes of the Road during the present year, from
freights and travel, have been less than they were
for the previous year, which was one of unusual
prosperity. The low price of corn, wheat, and
other kinds of grain during the present year, has,
in a great degree, prevented their shipment. Not
only were the prices of wheat much lower than
they were the year previous, but the quantity made
in all that section of country which supplies the
Road with freight, was much less.
Merchants limited their purchases of goods to
the limited demand for them in the country; hence,
the diminution of incomes to the Road on account
of freights on merchandize.
That portion of the Road track between Tunnel
Hill and Chattanooga, (seven miles excepted) was
in a very bad condition when Dr. Lewis took charge
of the Road, and it has required a great deal of
costly repairs. A considerable portion of the track
between those points has been taken up and thor
oughly repaired, and small stones pounded into
the earth under the new cross tics at several places
where in wet weather the earth is so soft that the
Road-bed could not otherwise be made firm. This
‘kind of repairs is quite expensive, but is believed
to be cheapest in the end, as the track in these soft
places will remain firm when once bedded in stone.
The entire track is believed to be in better condi
tion than it has been for several years, (a force of
about three hundred hands having been employed
in its repair most of the summer,) and all the roll
ing stock is in good order. Repairs ha vc also been
lately made at Alatoona, Petit’s Creek and the
Tunnel.
Since your last meeting one thousand tons of
new T iron have been purchased, which has all
been paid for since the Ist day of January last.—
This will lay about eleven miles of the track with
new, heavy bar. Part of this iron has already
been laid down upon the track, and the remainder,
now being received, will soon be laid down. Oth
er new iron will be purchased as fast as it is need
ed.
It is a matter of great importance that the Road
be kept in good order. For this purpose it is
proper that several miles of the track at dilferent
places should lie laid with new iron every year;
otherwise the iron on a large portion of the track
might wear out at the same time, requiring a very
heavy outlay to replace it. I hold that no ad-’
ministration, for the purpose of paying money in
to the Treasury or otherwise, has a right to let the
Road ruu down. He who does it deserves to be
condemned; and I am willing that my adminis
tration, so far as the management of the R< ai is
concerned, shall be judged by this standard.
According to the report of the Senate Commit
tee, the present Superintendent, when he took
charge of the Road, Ist January last, was charge
able with assets amounting to about $57,324 15,
due from connecting Roads and solvent agents,
with a balance in the Treasury of $15,907 43.
And he paid, according to the report, from Ist Jan
uary to Ist July the sum of $157,773 23 to credit
ors of the Road, on account of indebtedness con
tracted prior to Ist January, 185S, and had in the
treasury of the Road Ist July a balance of $35,010
96. It will be seen therefore, that the amount in
the treasury was much smaller Ist January than
it Avas Ist July; and that the amount of debts
contracted by former administrations of the Road,
and paid by the present Superintendent, from Ist
January to Ist July, 1858, tvas $100,449 08 larger
than the amount of soWent assets turned over to
him. The present Superintendent would seem,
therefore, to be entitled to this sum, paid out of bis
net earnings as a cash credit. In this sum is in
cluded the price of 400 tons of the new iron above
mentioned, Avhich was ordered by the former'Su
perintendent prior to Ist January last, and has
been paid for and laid down by the present Super
intendent since that time; Avho has also, through
the Treasurer of the Road, paid into the State
Treasury, commencing Avith the month of March
last, $200,000. Of this sum $175,000 had been j
paid in at the date of his report of 30th September, ;
and $25,000 since that time for the month of Oeto- j
her. The current expenses of the Road have been j
paid. No new debts are permitted to accumulate j
Avhich are not promptly paid, if the creditor can ‘
be found, at the end of each month.
The new passenger depot at Chattanooga is in
process of construction under the superintendence
of the Chief Engineer of the Road, with workmen
hired by the general Superintendent. The build
ing is 101 feet wide and 303 feet long, and is a
very solid and well built structure. It is built
of stone to the spring of the arches, Avhich are
turned with brick. It is expected to be comple
ted and ready for use in a few weeks. All ex
penses of this structure haA e been paid monthly.
It is intended that the depot be used by all tue
Roads connecting at that place. As some of
these Roads Avere not in a condition to incur the
expense at the time the Avork was commenced of
contributing to its erection, it was thought best,
as there was great need of the depot, lor our Road
to go on and build it, and take the obligations of
the connecting Roads for their proportion of the
expense. The Naeliville & Chattanooga Road
takes one fourth interest in the depot, and pays
SIO,OOO. The East Tennessee and Georgia Rail
road Company agrees to take another fourth, and
to pay a like sum, at lavo and three years from
the time they are ready to use it, Avith semi-annu
al interest at the rate of seven per cent per an
uum: and it is believed that the Memphis and
Charleston Road will also take a fourth interest.
Dr. LeAvis took charge of the Road the Ist day
of January last, and Avas under the necessity of
applying the net earnings of the months of Janu
ary and February in payment of debts against
the Road Avhich existed prior to that time, and
for necessary repairs on the Road, including pay
ment for iron preA'iously ordered. It Avill be seen
that the payments made into the State treasury
from the Ist of March last to the present time,
have averaged twenty-five thousand dollars per
month. It is believed in future that all necessa
ry repairs can be made, all current expenses
promptly paid, every department of the Road
kept in first rate order, and that an average of
$25,000 a month can bo paid into the State treas
ury, from year to year.
This may be regarded by some as an over esti
mate of the legitimate net earnings to be realized
in future from the Road. As an evidence, lioav
ever, of my confidence in its correctness, I have
no hesitation in saying that 1 would risk my per
sonal fortune on the result. Were I satisfied that
it Avere the desire of the Legislature and people of
Georgia, I Avould bind myself as an individual to
take the road for a term of ten years commencing
Ist January next : and I would give bond in any
reasonable sum Avhich might be required, Avith
ample security, to return it in as good order as it
Avas Ist January last. 1 Avould lay down ten
miles of neAv T iron on the track every year, the
old iron taken up, or the price of it, being mine.
I would take the benefits and the burthens of all
contracts made by the authorities of the road
since the Ist of January last, receiving all sums
owing to the road and paying all debts OAving by
the road on contracts made since that time. I
Avould bind myself that the present price of
freights should at no time be increased, if such in
crease Avould make the freights higher than the
average price charged for freights by the other
roads in Georgia; and I would pay into the trea
sury of the State .-£25,000 per month for the use
of the road, its equipments and appurtenances, to
be paid monthly in cash or in bonds of the State,
or in the bonds Avhich now constitute the funded
debt of the Road; for the payment of Avhich, the
faith of the State has been pledged for years. And
every time a payment should be delayed tAventy
iive days after it Avas due, I would forfeit and pay
to the Stete SIO,OOO for the delay. This would
be $300,000 per annum principal besides interest.
And a term of ten years at these rates, counting
ssmple interest at seven per cent per annum on
each monthly payment from the time it Avas paid
into the Treasury till the end of the lease, would
yield the sum of $4,041,250, for tbo use of the
road for that time.
Regarding the question as settled, therefore,
that the road Avith proper management Avill pay
into the Treasury $25,000 per month, or three
hundred thousand dollars annually clear of all
expenses and repairs, the inquiry naturally ari
ses, what disposition shall be made of the money?
Payment of the Public Debt—Common School *Sys
tem.
The public debt of the State amounts at pres
ent to $2,630,500, payable at different times du
ring the next twenty years. A large portion of
this debt has been contracted from time to time
on account of the State Road. This debt it Avill
be remembered, is subject by legislation, already
had, to be increased $900,000, on account of the
State’s subscription for stock in the Atlantic and
Gulf Railroad Cos. This Avould make the whole
debt $3,530,500, should no part of it be redeemed
before the bonds of the State for the above men
tioned $900,000, shall have been issufd. Ry the
terms of the contract with the bond holders,
$289,500 of this debt is ijoav subject to he paid at
the option of the State, though payment cannot
be demanded till 1863 and 1868. The Central
Dank bonds are also falling due in considerable
sums annually. Good faith requires that the
debts of the State be promptly met Avhon due.
And sound policy dictates that such bonds as are
due or not, at the option of the State, betaken up
as fast as she has the means.
The net earnings of the Western and Atlantic
Railroad ore already pledged for the payment of
a large poi-tion of this debt. I therefore recom
mend the passage of an act setting apart $200,-
000 per annum of the net earnings of the road, to
be applied in payment and purchase of the pub
lic debt. And, in vieAV of the great and acknowl
edged necessity existing for the education of the
children of the State, and of the immense advan
tages which would result from the establishment
of a practical Common School system, I further
recommend that a sum as large as the entire
amount of the public debt, be set apart as a perma
nent Common School Fund for Georgia, to be in
creased asfastas the public debt is diminished ; and
that the faith of the State be solemnly pledged that
no part of this sum shall ever he applied to, or ap
propriated for, any other purpose than that of
education. Let the act make it the duty of the
Governor each year as soon as he shall have ta
ken up the $200,000 of the State’s bonds, to issue
$200,000 of neAv bonds, payable at some distant
period to be fixed by the Legislature, to the Sec
retary of State as trustee of the Common School
Fund of the State, with semi-annual interest at
six per cent per annum. The bonds to be depos
ited in the office of the Secretary of State. As
the public debt is annually diminished the School
Fund Avill be annually increased, until the whole
debt is paid to the creditors of the State, and the
amount paid converted into a School Fund. And
as the fund is increased from year to year, the
amount of interest to be used for school purposes
Avill be likewise increased.
Should this plan be adopted, in a feAv years the
school fund of Georgia, including the present fund
for that purpose, would be in round numbers s4,*-
000,000. The amount of interest accruing from
this fund, to be expended in erecting school hou
and paying teachers, Avould be $240,000 per
annum. I am aAvare of the difficulties Avhieig
have been encountered by those avlio ha\-e at
tempted heretofore to deAise a practical and equal
school system for the State, owing in a great de
gree, it is believed, to the fact that portions of our
State are very densely, AA’hile others are quite
sparsely populated. But the fact of cur inability
to accomplish all we may desire is no sufficient
reason why Ave should neglect to do that which is
in our power. Probably the principal cause of
our failure in the past is attributable to a lack of
funds and of competent teachers.
With the gradual increase of the fund proposed,
it is not doubted that the wisdom of our State
would, from time to time, improA'e our present de
fective system till it would be so perfected as to af
ford the auA'antages of an education to all or near
ly all the children of the State. Let the teachers
be paid by the State, and let eA'ery free white child
in the State have an equal right to attend arid re
ceive instruction in the jrublic schools. Let it be
a Common School, not a Poor School System.—
Let the children of the richest and the poorest pa
rents in the State, meet in the school-room on
terms of perfect equality of right. Let there be
no aristocracy there but an aristocracy of color
and of conduct. In other words, let every free
Avhite child in Georgia, whose conduct is good,
stand upon an equality of right with any and eve
ry other one in }he school-room. In this way the
advantages of education might be gradually dif
fused among the people; and many of the noblest
intellects in Georgia, now bedimmed by poverty
and not developed for want of education, might be
made to shine forth in all their splendor, blessing
both church and State by their noble deeds.
Should $4,000,000 be insufficient to raise annu
ally the sum required, the fund might be increased
from the incomes of the Road, to any amount ne
cessary to accomplish the object. The interest
on this fund should be semi-annually distributed
equally, rmong the counties, in proportion to the
Avhole number of free Avhite children in each, be
tween six and sixteen, or of suchpther age as the
Legislature may designate, Authority should also
b cleft with each couiUy to tax itso-l> •
pleasure, to increase us school ffin l. f
And it should be left to the IniVri , 1
School commissioners -d eath couiuv. i,
the county into such school district.'.
most conA-enient to its population, havir 1
gat'd to their number and condition.
Education of Teachers.
Assuming that provision Avill be thus ;
raise all the funds necessary to build m] ,
ses and pay the teachers to educate all
white children of the State, the next ,
which presents itself, and perhaps the i
portant one of all; is, How shall the Star
herself Avith competent teachers? rab
iniust and devoted to iter interests an> h,
tut ions ?—southern men, with so;;
and southern sentiments?
For the purpose of educating tb. .-.i-r.-p
in Georgia colleges, I propose that the >•
her bonds payable at such distant time - ■
gislature may designate, bearing inttivs;
per cent payable semi-annually. The in
be paid out of the net earning of the 8,
and the bonds to be redeemed out of its r:
should it ever be sold. That she Helix er
of-these bonds to the State University, at
as an additional endowment; $50,000 to tlx
gia Military Institute, at Marietta, an<ls t > u
each of the three denominational Colli - - j u
State, in consideration that each of saih ,
leges, will bind itself to educate annually, , -
young man as a Slate Student, for every $y
annual interest Avhich the eudoAvmen.
the State pays to the College; furnishing
board, lodging, lights, washing, tuition, mb
necessary expenses except clothing, which
be furnished by the student himself or his ]
The interest on this $400,000 of bonds a\ i
$28,000 per annum. This sum Avould r m.;
and instruct as above suggested one humhe
forty young men annually, being one from >.
county in the State, and iavo from each <;
fourteen counties having the largest popul
unless other ucav counties are formed. I pro;
that these young men be selected from all
counties in the Stale, from that class on!’
young men whose parents are unable to ede
them, and that only such be selected as are ui
moral character, industrious and attentive, >,
desire an education, and who give promise
tore usefulness. That the selection be m I.
each county by a competent, committee a;
by the Inferior Court, after an e.xamiim ;
some public place in the county of all such y,
men as desire to become beneficiaries, ;,mi v, ■ ,
will attend on a day to be fived by the I. r ;
Court, after giving due notice. Let the cenm
! tec be sworn that they Avill be governed in if .
lection by the merits of the applicant, vvi. ;
prejudice or partiality; and that they Avill .and, .
no one whose parents are kaoAvn to bo abh to
him a collegiate education without doing ; , i. ; ;
to the rest of his family. And I propose
place of any such student in college be tn; ; ,
by another, Avhcnever the faculty of the ft-;;, ■
shall certify to the Inferior Court of hi. .ur;, .
that he is neglecting his studies or failing t< at;
reasonable progress, or that he has become muff -
ed to immoral habits. I propose that the
in this manner, gh r e to each of the p<.>r 1
men thus selected his collegiate education, mi,
dition that he will enter into a pledge of hm
make teaching his profession in the count} .
which he is sent, for as many years as 1. g
ha\ r e been maintained and educated by tff
in College; the State permitting him to enjoy
incomes of his labor, but requiring him to fff .
as a teacher.
Many of these young gentlemen avouM
doubt, adopt teaching as their profession Ur; .
This Avould supply the State after a few years >w
competent teachers. And as these young
while teaching in the various counties in tu<-
Avould prepare others to teach without g i
college, pure streams of learning would tin; 1
caused to 1!oav out from the colleges, and bee:
fused among the masses of the people throe,
the State. Then we wouid not so often hear the
plaint, that the child must unlearn at one -ff
what it has taken it months perhaps to loanin'.;
other under an incompetent teacher. The
intended to equalize as far as possible, th o
with the rich, by giving to as many of them
possible, at the expense of the State, an ojpm
nity to educate their sons in college, a privil
at present confined almost exclusively to the ri
as poor men have not the means to educate the',
sons hoAvever deserving or promising they ir;
be.
Under the plan above proposed it is not in
decl to make a donation, or absolute gift t
colleges, of a single dollar of the bonds
State. It is intended only to deliver the ho;
the colleges and to pay to them the interest -■
annually, as a compensation for them to maim ;
and educate annually, one hundred and ,
young men of promise, who could in no other w
enjoy- the advantages of a liberal education: \:i
in turn are to diffuse intelligence among the
body of the people, thereby supplying :':e
with Georgia teachers well qualified to ; e ; ;
youth of Georgia : and who would be, at ,i,
time, the natural friends of her institution;,
part of this plan I also propose that a. ■
Superintendent of schools for the thole. >e
ted with a salary sufficient to secure the in ■
whose duty it shall be to collect valuable im ru
ination upon the subject, and report aini :,
the Executive, to belaid before the legisialie. :■
and to traverse the State in every direction, ■< i
the schools, address the peopie, and do ail in ;
power to create a lively interest on the subju.’
education.
Carry out this plan and who can estinn
benefits to the State ? I regard tho educate
the children of the State as the grand oi jc ;
primary importance, which should, if nece. :
take precedence of all other questions of r :
policy. For I apprehend it will be readih
mitteuby every intelligent person, that the si; i
-and permanence of our republican institut;
hang upon the intelligence and virture of our j
pie. No monarch rules here! And it is th< ! : t
of our system of government that each citizen .
the ballot box possesses equal rights of seven pu
ty with every other one. Thanks be to our Ho; -
enly Father, the popular voice cannot he? ‘ !
hushed in the silence of despotism, but the ] pu
larwill dictates tho laws. May it thus ever remain!
How important it is, therefore, that the mass; s ‘
the people be educated, so each may be able t ;
read and understand for himself, the Constitution
and history of his country, and to judge and deem
for himself, what are the true principles and policy
of his government. Hut how much more impor
tant it is, in my opinion, that every person in t
State be enabled to read for him or herself :
the Holy Bible, and to .comprehend the great psi 1-
ciples of Christianity, in the eternal truths of wid’
lam a firm, though humble believer. Euucj
the masses and inculcate virtue and morality, I<-
you lay broad and deep, in the hearts of our }■■-• >-
pic, the only sure foundation of republican liberty
and religious toleration: the latter of which is ; ho
brightest gem in the onstitution of our Ccountry.
By adopting the proposed line of policy we
have it in our power, without increase ot taxation
or burden to our people, to place Georgia, as far
as education is concerned, in the proudest po; i
tion of any State in the Union. Let her educate
every son* and daughter within her limits, and she
may then justly boast that she is the,empire Sr& ■-3
of not only the South, but of the whole Union.- —
By this plan the public debt would be reduce;,
and the school fund increased, annually, ;
and the interest amounting yearly to $28,000 c
the bonds delivered to the Colleges’ would be paid
semi-annually, out of the net earnings of the St; t
Road; and there would still be left an annual in
come from that source of $72,000, to be applied
to other purposes.
Reduction of Taxes.
The present annual expense of the Government,
including the civil establishment, the interest on
the public debt, support of Asylum, Academy for
the blind, State Cadets in Military Institute, Jc.,
amount to about $446,000, without including ary
of the extraordinary appropriations. The pres
ent annual incomes to the Treasury from the State
tax. the tax on bank stock, railroads, diA'idends on
bank stock, and from other miscellaneous sources,
such as copy grants, testimonials, <&e.. amount to
about $416,000, exclusive of incomes from tho
State Road. It follows thorefore, after allowing
somes22,ooo pr. annum of special appropriations,
outside of the actual expenses of the Got era men t,
that the taxes might bo reduced irom tne incomes
of the Road about $50,000 P er annum >esides es