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oc*leel)ln Constitutionshsl.
BY JAJVTES G^IUDISTER.
GOVERNORS’ MESSAGE.
Executive Department, )_
Milletoeville, Ga., November 3,1555. )
Fellow Citizens of tin Senate and House of Repre
sentatives :
It affords mo much pleasure to be able to state
that the financial condition of the country is great
ly improved siuce tile adjournment of your last
session. I'revions to that time, the commercial
crisis, aggravated by a general suspension of spe
cie payment by the banks of many of the States,
including most of the banks of this State, attend
ed by distrust and loss of confidence, bad depress
ed the spirits of our people, and seriously affected
all the great interests of our State.
HANKS AND BANKING.
On the 22d day of December last, both branches
of the General Assembly passed, by a constitu
tional majority, without Executive sanction, an
act entitled “an act to provide against the forfeit
ure of the several bank charters'll! this State, on
account on non-specie payment for a given time,
and for other purposes therein named.’ 1 act
made it the duty of the Governor to withhold pro
ceedings under the act of 1840, for the forfeiture
of the charters of sti ll banks in this State as had
violated the law, and were in a state of suspension,
until the loth day of the present month, or till the
happening of certain contingencies mentioned in
the act.
In view, doubtless, of the great imposition
practiced upon the people by the banks, in taking
from them usury under-tne name of exchange,
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 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
cr 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 (or money loaned at a greater rate of inter
est than seven per cent., as "well as all notes, pa
pers and evidences of debt discounted or purchas
ed in violation of staid act, are declared to be ut
terly milt and void, and irrecoverable in law.
The tenth section of the act regulates the per
cent, which a bunk may receive for exchange,
when its ntvn 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 net for the purposo ot
protecting the people against the usurious and ex
orbitant exactions of the banks. And to prevent,
as far as possible, violations of the act, in the par
ticulars above referred to, it is enacted by the
eleventh section, that, “The affidavit of hank otli
cers to their annual and semi-annual reports, shall,
in all cases, state that tin- bank in which they arc
officers, has not, by itself, its officers or agents, in
any puriiculaf, violated the provisions of this act.”
And the twelfth section makes the offence perjury,
should bank officers swear falsely in making their
reports. By requiring of bank officers the solemn
guarauty ol 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 mv sanction from the act
on account of other objectionable features in it,
and on account of the doubts 1 entertnined 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 aunual and semi-an
nual reports, which apply alike to all banks in the
State, are both constitutional and expedient. En
tertaining these views, on the Ist day of June last
I issued my proclamation, calling on the banks to
make their returns according lo law, and to com
ply with said eleventh section of the act of 22d
December, 1857. As had been passed by
the legislature mainly tot the relief of the sus
pended hanks, and at the earnest solicitations of
their friends, I had reason, in common with all
law abiding citizens of the Slate, to suppose that
they would render cheerful obedience to "all its re
-quiremenls. It is with much regret, however,
that 1 have to state to the legislature, that by far
the greater number of the hanks whose suspension
had been thus legalised, and whose charters had
been so recently relieved from liability to forfeit
ure, in open violation of tile statute passed for
their relief, as well as all the banks in the State
which had not suspended, cither neglected or
opentv refused to obey the Jaw, and make their re
turns’as directed by the positive mandate of the
statute; thereby placing themselves in a position
of defiance to the constitutional authorities of the
State.
In this state of things I issued my proclamation,
as required by law, publishing the names of such
■ delinquent banks, and notilying 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 ts evident, therefore, that the penalty of
excluding their bills from the Treasury, which is
the only penalty now prescribed by law for a fail
ure to make their returns, is not sufficient to com
pel obedience to the requirements of the statutes.
Doubtless some of the banks have made more by
usury, and by disregarding in other respects the
act of 22d of December last, than they have lost
by suffering the present penalty for not making re
turns in accordance with existing laws.
For the purpose of compelling these corpora
tions to yield obedience to the law in future, I re
spectfully recommend that a penalty for disobe
dience 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 collected in gold and silver, for the
entire time during which any such bank may in
future remain in a state of disobedience, and fail
to make its returns as directed by the statutes.
There can be no just reasons why wealthy corpor
ations should be permitted at their pleasure to set
the law at defiance, while individuals are compel
led to suffer rigorous penalties for its violation.
The mandates of the law should be obeyed as
promptly 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 of December, 1857,
been passed, than the banks, forgetful of tbeir
promises to expand their circulation, to discount
freely and relieve the country, lefustd to discount
notes, however good, when offered to them in a
legitimate course of banking business, or to ex
tend accomodations to any except perhaps a tavor
ed few, sueh as cotton buyers and other specula
tors. Merchants and others compelled to have
northern exchange, were generally unablte to ob
tain it for less than three per cent. The price of
cotton declined, and monetary distress became
general throughout the State.
The hanks having thus abused the generous con
fidence reposed in them by the legislature, contin
ued to enjoy the benefits of the suspension long
after the banks of the great cities of the North and
West had resumed specie payment, and until the
just indignation of an injured people, expressed
through the public press, by public meetings and
otherwise, became so prevalent that they felt com
pelled by tear of future consequences, to retrace
their steps and curtail the speculation they oiner
wise would have made out of the suspension. They
therefore prepared to resume on the Ist day of
May last; thus admiting, by their resumption six
months in advance of the time fixed by the stat
ute, that no such necessity as they represented to
the legislature ever did exist for the passage o. the
act. A gentleman of great ability and worth, who
is at the head of one of the most important and
influential banks in the State, in his report in May
last, while apologising for the suspension, and re
fering to the fact that the legislature had given
time till the 15th of November, says: “Our banks,
impatient under the supposed odium of suspen
sion, resolved to resume on the Ist of the present
month,” (May.) It is a fair inference, therefore,
that the banks would have continued the suspen
sion tUI the time fixed by the act for them to re
sume, but for the pressure of public opinion, and
their impatience “ under the supposed odium ol
suspension.” Public opinion having thus compil
ed the bank 3 to resume before the lime fixed by
the statute, and the crisis having passed, we, as
rational men, should learn wisdom by experience.
t.r, i try to provide asfar aspossible agates' abv -
of their privileges by these corporations in future.
I presume it will not be denied by any one, that
we have erred by a too liberal and ungarded grant
of corporate powers and privileges to moneyed
monopolies. And it is believed that a future ex
tension of this policy would soon enable these
monopolies lo control the government of Georgia
and make the people the subjects of their power.
It is already claimed by some, that they now have
the power, by combinations and the free use of
large suras of money, to control the political con
ventions and elections of our State, and in this
way to crush those who may have the indepen
dence to stand by the rights of the people in op
position 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 im
posed by the corporate powers of the State. Let
it not be forgotten, however, by those who have
watched with anxiety the growing power of cor
porate influence, that the price of Republican lib
erty is perpetual vigilance.
The monetary and commercial affairs of the
country must necessarily remain subject to pan
ics, under heavy pressures, at certain, if not fre
quent intervals,' as long as our present banking
system is continued with its enormous powers and
privileges, which hive been enlarged and extend
ed by legislative enactment, chartering new hanks
from year to year. The people should take this
subject into serious consideration, and pronounce
upon it a calm and deliberate judgment. Evfcry
intelligent person must admit that it is impos
sible 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 lor pay.
metit at any one time, and the specie be demand
ed, it can ilien redeem but one third of them. In
that case, if the bank has sufficient assets, or pro
perty, tiie other two-thirds may possibly not be
an ultimate loss, but payment must be delayed un
til tiie money can be realised by a disposition of
those assets and properly, which mav not be till j
the end of a lengthy and uncertain litigation. It
is clear, therelore, that our present paper currency
is not a currency convertible, at all times, into
gold and silver, upon presentation ; and that only
one-third of it, should payment be demanded on
all at or.e time, can, in the nature of things, be so
convertible so .long as the banks issue three dol
lars 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 convertible iuto gold and silver. It is
true, our people, by a sort of common consent, re
ceive the bills ot the banks and use them as mo
ney, though in reality they rest upon no solid
specie basis. But sad experience has taiucbt us
that sueh a circulating medium subjects the coun
try to panic at tbe first breath of distrust or sus
picion, which may be produced by tiie failure of a
single hunk having a large circulation and exten
sive connections with other banks, and may widen
and extend to the prostration ot 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 m place of money itself.
The people take from the banks their bills as
money. Tiie 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 prerogative of
exercising banking privileges, and of issuing their
own notes or hills to he circulated as money, not
resting 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
privileges upon like terms is denied to all indi
vidual citizens of tbe State by stringent penal
enactments.
Tbe privilege of using their own notes as mo
ney, gives to the favored few who enjoy it, im
mense advantages over their fellow-citizens, and
may often enable the managers of these corpora
tions to amass great wealth by their high salaries
and large profits. It may, however, hi- said that
many of tbe stockholders are widows and orphans;
that the stock is in the market for all, and that the
dividends are not greater than the profits realised
from other investments. This may be admitted.
Indeed, it seems in practice to be generally true,
that corporate privileges do not result so much to
the benefit of the mass of stockholders as io the
benefit of the few who manage the eorpurati n.
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 ulso take into the account the banking
houses, real estate and other properly purchased
out of the profits of the bank and held by the cor
poration. Besides, we should consider a reserved
fund of two, three or four hundred thousand dol
lars, made lip of accumulated profits, and often
kept back by our larger banks and not distributed
among thoestockholders, together with the high
salaries of all the officers of the hank, 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, Ac., and alt amounts lost by de
faulting agents, which, while they cannot be set
down as profits of the corporation, since neither
its officers proper nor its stockholders are benefited
thereby, are still sums of money which, under the
workings of the system, are drawn by the corpo
ration trom the pockets of the people.
To all this add the 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
1848 and 1849, 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 1855, she issued $48,500- of bonds to
pay her indebtedness on account of the Darien
Bank, which are still unpaid, making $288,500 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 have
paid and continue to pay in taxes and suffer in
losses to sustain the banking system.
Again, in many instances, those who control tiie
corporation may have great advantages in being
able, if they choose, to obtain such accommoda
tions as they may desire, by the use of its funds,
when a favorable opportunity lor speculation oc
curs. The dividends paid . Stockholders ate,
therefore, no proper criterion by. which to judge
of the advantages of •!, ■ coi (.oration to those who
hold its offices a:--'. and mat •»« its .capital
and its opera:: ( the sim i-> : i., :i
people on ace: kings ; it... s.vsiem.
Thus far I Is ■ ...> ■,’. the
supposition th . .. . esc edthree
doners for ever; n bar. d in
the bunks to nn . supposi
tion is more (.■.•. • , . o inks than
facts will jus::! ~ - . iS only
requires that to J . . : C J three
dollars for eve: ■ 1 . ■ . to meet
those liabilities. jnd the error of
our present ! • banks,
suppose tbe : , . of 'he
bank be limiT. , , .0, which
is to be p_ bv the stock
holders. T ,~j s that tlje , ja .
bititles of t . time exceed three
Umestt 'a! st ick actually paid
m. lb - t b e $500,000, in gold
and surer, t of the bank may then,
without at. . ■ letter of the charter,
in.ur 11 !i n bank to any amount
that dofcj \~i-i 0 000; and that too
without air .. • heir part tole.*p in their
vaults the *' * p ,:,l in. or a like sum
If they -h i: their s ,eoieand i
invest It ir i • t •», leaving!
but $!• ’ ■.,, ~.|j I
con'rac d*', ’ : a .
half, and nr . ..of!
their char: . -of;
capital ■'• .u.tblir j
T_k. • _ - -■ h m
A.TJGYJST.A, WEDNESDAY, NOVEMBER 10, 1858.
to have been well understood by our people. They
have generally believed that our banks, by tbe
letter of their charters, were required to have on
hand at all'timrs an amount of specie one-third as
large as tiie entire amount of their liabilities. The
banks have understood the matter very differently,
and have not only claimed, but exercised the right
when thev regarded it their- interest, to extend
their liabilities far beyond three dollars for every
one of specie actually on hand to meet those liabil
ities. By examination of their returns made to
this Department in October, 1857, it will be seen
that at the lime of the late suspension ofourbanks
in Augusta and Hdvanuah, the liabilities of one
of them for bills in circulation and individual de
posits, exceeded thirUen dollars for every one dol
lar of both specie and bills of other banks which
it then had on build. Another had one dollar in
specie in its vaults for every fifteen dollars of its
liabilities for bills in circulation and deposits. An
other bad uot <))#ffi)!!ar in specie for every seven of
liability for bills iu circulation and deposits.; and
another bad only one dollar in specie for every
eleven dollars of its liabilities of the character
mentioned above. It ts true these banks had other
assets, but those ussels were not money. The ques
tion naturally suggests itself, how can such a cur
rency be convertible into gold and silver—the
money of the Constitution—on demand or presen-'
tation? How can a bank with fifteen dollars ot
cash liabilities for every one dollar in specie, el
even of five dollars for one, pay its liabilities
promptly on demand? It is impossidle. And
how can its bills be justly considered safe as a cir
culating medium, or as money, if it cannot redeem
them promptly on demand ?
In eousidetation 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 tins be not
possible, we should abandon it entirely. lam 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 refor
j mation so radical, if attempted, must be the work
of years. If the legislature would continually re
fuse to charter any new hank, or to enlarge the
capital stock of, or re-charter any bank now in ex
istence, tlm system would gradually work itself
out by efllux of time; and we might, without any
sudden shock, return safely to the currency of the
Constitution, plant out selves upon-a firm specie
basis, and rid ourselves of a system against which
the great and good ineu who conducted the revo
lution and formed our Constitution intended to
guard their posterity, alien they declared in the
Constitution tiutl nothing but gold and silver coin
should be made a legal tender.
In two ol the Suites 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 tiie
late commercial pressure was comparatively hut
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 then’ number and thereby
increasing their power in the State, I would re
spectfully urge the imp rtance of guarding all char
ters with much greater stringency in the future.
Let the charter of each provide that the entire lia
bilities of the bank shall, at no time, exceed three
dollars for every one of specie actually in its vaults
and bona fide the property of the hank, on pain of
immediate forfeiture. Let the simple fact of sus
pension of specie payment render the charter ab
solutely null and void. This would deter them
from engaging in such wild speculations and over
issues as compel them to suspend iu case of pres
sure. Let provision also be made that all execu
tions issued against the corporation may he levied
upon the property of any stockholder until the ere
ditor be satisfied, leaving the stockholder lo his le
gal remedies against the rest of tiie stockholders to
enforcecontribut ion among themselves. Let the bills
of the banks in the hands of the people at the time
of suspension, bear interest from that time till paid.
And let the legislature retain the right, by express
reservation in tiie charter, to alter, modify or re
peal it at pleasure. In my opinion it would be
best for the legislature to refuse to granta charter
to any corporation tor any purpose whatever with
out retaining a similar power, should its exercise
be required by the interests of the Stute or the
public good. If-the corporation is unwilling to
trust the people with this repealing power, liow
much more shoiihl the people be unwilling to trust
the corporation without it.
Prohibition of Small Pills. —Several of tbe States
have already passed laws prohibiting tiie emission
by their buuks of small billß. I once entertained
doubts whether our legislature could do this with
out a violation of the chartered privileges oi the
banksi but on mote mature reflection and careful
examination, those doubts are entirely removed
from my mind. I therefore recommend the pas
sage of a law prohibiting the emission of small
hills by the banks of this State, and forbidding,
under heavy penalties, the circulation within tills
State of bill* of a like denomination issued by
banks of oilier States. Such an act might pro
hibit 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 Btated times ns might be thought
best, so as not to embarrass the business transac
tions of tbe country. The effect 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 circu
lation in their stead. This would cause gold and
silver to take the place of bank bills in all tbe
smaller business transactions. The laborer would
then receive the price of his labor in gold and sil
ver, the farmer of small means would generally
receive the price of his produce in gold and silver,
which would remain good however much bank
bills might depreciate.
Sub Treasury System. —l also beg leave to call
the attention of the General Assembly to tbe pro
priety of establishing by law a Bystem for "onr
State similar to tiie sub-treasury system of the
United States, the wisdom of which has been fully
demonstrated by the beneficial results of its prac
tical Operation. I earnestly recommend the adop
tion of sueh a system. Let all payments into the
treasury, after a reasonable time to be fixed by the
legislature, be made in gold and stiver, and let
the State pay the interest upon her public 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 liabili
ties, in gold and silver. Os course the system
yhould go into operation gradually. This, in con
nection with the prohibition of the circulation ol
small bills, would keep out of the banks and in
| circulation among the people a large amount of
j coin, placing the currency upon a much more solid
! specie basi3, making tbe people more independent
I of banks, and enabling them to withstand the shock
with much less injury in case of a commercial cri
sis and bank suspension. It is believed that no
serious inconvenience could result to the tax payer
from such a law, as the gold and silver paid into
tbe 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 tbe transporta
tion of specie from the treasury to the creditor,
provision might be made authorising certificates j
of deposit to be issued, which might be paid to
the creditor at his request in piaec of the coin.
These certificates of deposit might he of such de
nomination as the legislature may prescribe, hand
somely engraved upon steel plates, which plates
should be deposited in the treasury for safe keep
ing. Each certificate might be signed by the
Treasurer and countersigned by tbe Secretary of j
State, with the impression of tne great seal of the ;
State stamped upon it, and a register of the issue (
of each kept in the treasury to preventcountetfeit. j
These certificates might be made payable to the
person to whom they first issued or to hi aret. [
Thev would supply the place of bank bills so fur j
as the conveniences of a paper currency are ecu- j
cerned, while thev would be subject to none of the J
fluctuations of value.and the uncertain.us of baok
bills - They would be taken at the option only of .
the creditor in place of gold and silver. Too gold ;
and silver, dollar for dollar, would, v. Y u tl.-y
were in circulation, remain in -7 ‘.l*e ,
jreasury to redeem them A. »'it I » it. ;
These certificates, fhos pr. .......-i t-p’-i coin :u j
the treasury, dollar for dollar, would be receivable ,
in payment ot taxes or of any debt due the State.
They would be a safe medium of exchange, and
would, to the amount of their issue, he a paper
currency at all times convertible into gold and sil
ver Upim presentation at the treasury. " Each dollar ,
of paper would have for its basis a dollar of specie 1
in the treasury, and ns the faith of the S'ato would
be pledged for their redemption, it would be im
possible for any citizen to sustain loss upon them.
They would be a currency at all times and uuder
all "circumstances of uniform par value. This
would render the government of the State entirely
independent of all banks and bank agencies, anil
would iu a very great degree destroy the power of
the banks over the people, while it would give the
people gold aud silver change in all their small
transactions, and a paper currency perfectly secure
in many of their larger ones.
The suggestions made by tiie Secretary of the
Treasury of the United States, (Mr. Cobb,) in his
late report to Congress upon the subject of the
establishment of a Sub-Treasury system by the
States, similar (o that of the Uuited States, and
the prohibition of the circulation of hunk hills un
der the denomination of twenty dollars, are, in
my judgement, founded :;i wisdom, and commend
themselves to the sen s consideration of tiie
Legislature. The Star- of Ohio lias already shown
her appreciation of '.1., wisdom of thesesugges
lions, by transferring mnenof their substance to
her statute book, allowing sufficient time for the
gradual inauguration of the system inlo practical
operation.
Western if- Atlantic Railroad. For a statement
of the present condition of the Western & Atlantic
railroad, tr.s operations and income for the fiscal
year ending 3oth September last, I beg leave to
refer you t i the report of Dr. John W. Lewis, its
able and efficient Suprintendent, who has shown
himself to be a most vigilant, active, and valuable
public servant. In passing this well merited com
pliment upon tiie faithful Superintendent, I would
do injustice to bis associate officers, ami the other
agents and employees of the road, were 1 to fail
to express my entire confidence in their integrity
and business qualifications, and to commend tiie
zeal and energy with which they have exerted
themselves for the success of tiie road and tiie ad
vancement of the best interests of Die State. For
their efficiency, fidelity and integrity they have my
■sincere thunks, and arc, iu my opinion, entitled to
their tiianks ot tiie whole people of Georgia.
Owing to the commercial pressure, and (lie con
sequent stagnation of trndeand business, Hie gros
incomes of the road dating the present year, from
frieghts and travel, have been less than tlioy were
for the previous year, which was one of unusual
prosperity. The low price of corn, wheat and
other kinds of grain during die present year, has,
in a great degree, prevented their shipment. Not
only were prices of wheat much lower than they
were the year previous, hut the quantity made ill
all that section of country which supplies tiie road
with freight, was much less.
Merchants limited their purchasers of goods to
the limited demand for them in the country ; hence,
the diminution of incomes to the road on account
of freights on merchandise.
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 lias required a great deal
of costly repaiwc A considerable portion of the
track between those points has been taken up and
thorougly repaired, and small stones pounded into
tiie earth under the new cross ties 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 tbe end, us the track
in these soft pluces wiil remain firm when once
budded in stone. The entire track is believed
toH>e in better condition than it lias been for
several years, (a force of about three hundred
lianas having been employed in its repair most
.( the summer,) and all tiie rolling stock is in
good order. Repairs have also been lately made
at Alatoona, I’etit’s Creek and the Tunnel.
Since your last meeting one thousand tons of
new T iron have been purchased, which has all
been paidfrr since the Ist day of January last.
This will iuy about eleven miles of the track
with new, heavy bar. Part of this iron bus already
been luid down upon the track, and the remainder,
now being received, will soon be laid down.
Other new iron will be purchased as hist us it is
needed.
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 trade at diffe
rent pluces should be laid with new iron erery
year; otherwise (he iron on a large portiou oflhe
track might wear out at the same time, requir
ing a very heavy outlay to replace it. I hold
that no administration, for the purposo of pay
ing money into the Treasury or otherwise, has a
right to let the Road run down, lie who does it
deserves to be condemned; and I am willing that
my administration, so fur as tiie management of
the road is concerned, shall he judged by this
standard.
According lo the report of the Senate Com
mittee, tbe present Suprintendent, when be took
the charge of the road, Ist January lafct, wus
chargeable with assets amounting to about $57,
321 15, due from connecting Roads and solvent
agents, with a balance in the Treasury of $15,907
45. And he.paid, according to tbe report, from
Ist January, to Ist July, tbe sum of $157,773 23
to creditors of tbe road, on account of indebtedness
contracted prior to Ist January, 1858, and had in
the Treasury of the road Ist July, 1859, a balance
of $35,010 96. It will be seen, therefore, that
the amount in the treasury was much smaller first
January than it wus first July; and that the
amount of debts contracted by former admin
istrations of the road, and paid by the pre
sent Superintendent, from first January to
first July, 2858, was $100,449 08 larger than
the amount of solvent assets turned over to
him. The present Superintendent would seem
therefore to be entitled to this sum, paid out of his
net earniDgs as a cash credit. In this sum is in
cluded the price of four hundred tons of the new
iron above mentioned, which was ordered by the
former Superintendent prior to first January lust,
and has been paid for and laid down by the pre
sent Superintendent since that time; who has also,
through the Treasurer of the road, paid into t lie
State Treasury, c mmencing with the month of
March last, s2oo 600. Os this sum $175,000 had
been paid in at the date of his report of goth Sep
tember, and $25,000 since that time for the month
of October. The current expenses of the road
have been paid. No new debts are permited to
accumulate which 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 superinten
dence of the Chief Engineer of the road, with
workmen hired by the general Superintendent.
The building is one hundred and oue feet wide
and three hundred and three feet long, and is a
very solid and well built structure. It is built of
stone, to the spring of thearches, which are turned
with brick. It is expected to be completed and
ready for use in a few weeks. All expenses of this
structure hare been paid monthly. It is intended
that tbe depot be used by all the roads connecting
at that place. As some of these roads were Dot
in a condition to incur the expense, at the time the
work was commenced, of contributing to its erec
tion, it was thought best, as there was great need
of the depot, for our road to go on and build it,
and take the obligations of the connecting muds
for their proportion of the expense. The Nash- i
ville and Chattanooga road takes one-fourtb inter- i
est in the depot, and pays siu,ooo. The East Ten- i
nessee and Georgia Railroad Company agrees to I
take another fourth, and to pay a like sum, at two i
and three years from the time they are ready to i
use it, with semi-aDnual interest at the rate of seven <
per cent, per annum ; and it is believed that the
Memphis and Charleston road will also take a i
fourth interest.
Dr. Lewis took charge of the road the fir- • -1 ,
of January last, and was under the oece-->
applying the net earnings of the morithH ■ >
ary and February in payment of debts au
road, which existed prior to that lime, a
- -ary repairs on the road, including p -
iron previously ordered. It will be seen
pay merits made into the State trear-:
first of March last to the present tiu ;
aged twenty-five thousand dollars p-,. - j'
is believed in future that the nicess-c . r<; -
be made, all current expensesp. omr' . ■ ''
department of the road kept iu first late
and that an average of $25,000 a month can In
paid into the State Treasury, from year to year.
Ttiis may be regarded by some as an over esti
mate of tbe legitimate net earnings to be realised
in future from the roud. As an evidence, however,
j n ‘ my confidence in its correctness, I havo uo hesi
j tatuiu iu saying that l would risk my personal for
tune on the result. Were I satisfied that it w ere
the desire of the legislature and people of Georgia,
I would bind myself, as an individual, to take the
road tor a term of ten years, commencing first of
January next; and I would give bond in any
reasonable sum winch might be required, with
ample security, to return it in as good order as it
was first January last. I would lay down ten
miles ot new T iron oil the track every year, the
old iron taken up, or the price of it, being mine.
I would take the benefits and tiie burthens of all
contracts made by the authorities of the road since
the first of January last, receiving all sums owing
to the road, and paying all debts owing by ttie
road on contracts made since that time. I would
bind myself that the present price of freights
should at no time be increased, if such increase
would make the freights higher than the average
price charged for freights by the other roads in
Georgia; and 1 would pay into the Treasury of the
State $25,000 per month, fur tho use of the road,
its equipments and appurtenances, to he paid
monthly in cash, or in bonds of tho State, or in the
bonds which now constitute the funded debt of the
road ; for tho pavment of which, the faith of the
State lias been pledged for years. And every time
a payment should be delayed twenty-five days after
it was due, I would forfeit and pay to tiie State
SIO,OOO for the delay. This would be $309,000 pel
annum principal, besides interest. And a term of
ton years at these rates, counting simple interest
at seven per cent, per annum, on eacli monthly
payment, from the time it wus paid into tho Trea
sury till the end ot the lease, would yield the sum
of $4,041,250, for tho use of the road for that
time.
Regarding the question us settled, therefore, that
the road, with proper management, will pay into
the treasury $25,000 per mouth, or SBOO,OOO an
nually, clear of all expenses and repairs, tiie in
quiry naturally arises, what disposition shall he
inado of tiie money V
Payment of the Public Debt—Common School
System. —The’public debt of tiie State amounts at
present to $2,630,500, payable ut different time
during the next twenty years. A large portion of
this debt has been contracted from tune to time r p
account of the State road. This debt, it will be
remembered, is subject by legislation, already had,
to be increased $900,OOt), on account of the State’s
subscription for stock in the Atlantic and Gulf
RItiII nr.d'Gompany. This would make tint whole
d t : ’.-1,500, sliculd no part of it he redeemed
hr. ire ihe bonds of the State for the above men
tioned $900,000 shall have been issued. By tiie
tert is of the contract with tho bond holders,
$239,500 of this debt is now subject to be paid, at
tiie option of tiie Stute, though payment cannot t
be deinunded till 1803 and 1808. Tbe Central
Bank bonds are also fulling due, inconsiderable -
sums, annually. Good faith requires that the debts
of the State lie promptly met when due. And
sound policy dictates that such bonds as are due
or not, at tho option of the State, be taken up us
fast as she has the means.
The net earniugs of tho Western & Atlantic Rail
road are already pledged for the payment of n
large portion of this debt. I therefore recommend
the passage of an act sitting apart $200,000 per an
num ot the net earnings of the road, to be applied
in payment nn4 purchase of the public debt. And,
in view of the great and acknowledged necessity
oxisting for the education of the children of the
State, and of the immense advantages which would
result from the establishment of a practical com
mon school system, I further recommend that a
sum as large as the entire amount of the public
debt, be set apart as a permanent common school
fund for Georgia, to be increased as fast as the
public debt is diminished ; and that the faith of
tbe Butte be solemnly pledged that no part of thia
sum shall ever be applied to, or appropriated for,
uny other purpose than that of education. Let
the act make it the duty of the Governor, each
year, as soon as he shall have taken up the $200,-
000 of the State’s bonds, to issue $200,000 of new
bonds, payable at somo distant period, to he fixed
by tbe legislature, to tbe Secretary of State, us
trustee ot the common school fund of the State,
with semi-annual interest at six per cent, per an
num. Tho bonds to be deposited iu the office of
the Secretary of State. As the public debt is tints
diminished, the school fund will be annually in
creased, until the whole debt is paid to tbe credit
ors of the Stale, and the amount paid converted
into a school fond. And as the fund is increased
from veer to year, the amount of interest to be
used for school purposes will be likewise increased.
Should this plun he adopted, in a few years the
school fund of Georgia, including the present fund
for that purpose, would be, in round numbers,
$4,000,000. The amount of interest accruing from
this fond to be expended in erecting school houses
and paying teachers, would be $240,000 per an- -
mini, iam aware of the difficulties which have
been encountered by those who have attempted
heretofore to devise a practical snd equal school
system for tbe State, owing in a great degree, it is
believed, to the fact that portions of our Slate are
very densely, while others are very sparsely popu
lated. But the fact of onr inability to accomplish
u-1 we may desire is no sufficient rcuson why we
should neglect to do that which is in our power.
Frobably, tbe principal cause of our failure in the
past is attributable to a lack of funds and of com
petent teachers.
With tbe gradual increase of the fund proposed,
it is not doubted that tbe wisdom of our State
would, from time to time, improve onr present de
fective system, till it would be so perfected as to
afford the advantages of an education to ail, or
nearly all, the children of tbe State. Let the
teachers be paid by the State, and let every free
white child in the State have a-n equal right to at
tend end receive instruction in the public schools
Ixtt it he a common school, not a poor school, sys
tem. Let the children of the richest and the poor
est parents in the State meet in tbe 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
white child in Georgia, whose conduct is good,
stand upon un equality of right with any and every
' one in the school room. In this way, the advan
tages of education might be gradually diffused
among the people; and many of tiie noblest intel
lects in Georgia, now bedimmed by poverty and
not developed for want of education, might be
made to shine forth in all their splendor, biassing
both church and State by their noble deeds.
Should four millions dollars be insufficient to
raise annually the sum required, tbe fund might
be increased from tbe incomes of the Road, to any
amount necessary to accomplish the object. Tbe
interest on this fund should be semi-annually di
stributed equally, among the counties, in proper
tion to the whole number of free white children in
each, between six and sixteen, or of such other
age as the Legislature may designate. Authority
should also be left with each county to tax itself,
at its own pleasure to increase its school fund, as
at present. And it should be left to the Inferior
Court, or school commissioners of the county to
lay off'the county into such scliooqDistricts.as will
be most convenient to its population, having due
regard to tbeir number and condition.
JCducation of Teachers. Assuming that provision
wiil be thus made to raise ail tbe funds necessary
to build school houses and pay the teachers to
educate all the free white children of tbeHtate, the
next qnestion which presents itself, and perhaps
the most important one of all, is, How shall the
Htite supply herself with competent teachers’,
raised in her midst and devoted to her interests'
and her institutions’—southern men, with south
ern hearts and southern sentiments’
For the purpose of educating Georgia teachers
in Georgia colleges, I propose that the State issue
tier bonds payable at such distant times as tbe
!"gt-k:ur» may designate, bearing interest at sev
- per cent, payable semi-annually. The interest
1 paid out of the net earnings of tbeHtate
• - d . and the boDds to be redeemed oot of its
.cods, should it ever be sold. That she deliver
•' v 'to of these bonds to tbe State University, at
. i-o*,asan additional endowment; $50,W0 to
• Georgia Military Institute, at Marietta, and
, -j to each of the three denominational col
-1 jf in this Slate, in consideration that each of
l five colleges, will bind itself tocducate unnu
■..lv, oDe young man as a State student, for every
$2 tfj of annual interest which tbe endowment
YOL. 37-!ISfO. 46.
given fcv the State pays to the college; furnishing
him with board, lodging, lights, washing, tuition,
and all necessary expenses except clothing, which
might be furnished by the student himself or his
parents. The interest on this $400,000 of bonds
would be $23,000 per annum. This sum would
maintain and instruct as above suggested one
hundred and forty young men annually, being one
from each county in the State, and two from each
of the fourteen counties having the largest popu
lation, unless other new counties are firmed. I
propose lliut these young men be selected from all
the counties lu the State, from that class only of
young men whose parents arc unable to educate
them, and that only such be selected ns are of
good moral character, industrious and attentive,
who desire an education, and who give promise of
future usetulneas. That the selection be made in
each county by a competent committee appointed
by the luferior Court, aftcran examination at some
public.place m the county of all such young men
as desire to become beneiiciaries, and who will at
tend on a day to be tixed by the Inferior Court,
alter giving duo notice. Let the committee be
sworn that they will bo governed in the selection
by the merits of the applicant, without prejudice
or partiality; and that they will select no one
whoso parents are known to be able to give him a
collegiate education without doing injustice to the
rest of bis family. And I propose that the place of
any such student in college be supplied by an
other, whenever the faculty of the college shall
certify to the Inferior Court of his county, that he
1 is neglecting his studies or failing to make rea
sonable progress, or that he Ims become addicted
to immoral lmbits. I propose that the State, in
this manner, give to each of the poor young men
thus selecicd Jits collegiate education, on condi
tion that he will enter into a pledge of honor, to
make teaching bis profession in Hie county from
which lie is sent, for as many years as he shall
have been maintained and educated by the State
in collpge ; the State permiting him H> enjoy tho
incomes of his labor, but requiring him to labor
as a teacher.
Many of these young gentlemen would no doubt,
adopt teaching as their profession for life. This
would supply the State after a few years with com
petent teachers. And as these young men while
teaching in the various counties in the State would
prepare others to teach without going to college,
pure streams of learning would thus be caused
to II iw out from the colleges, and bo diffused
among the masses of tho people throughout the
State." TheiV we would not so often hear tho com
plaint, Hint the child must unlearn at one school
what it has taken it months perhups tolearn at anoth
er under un incompetent teacher. Tilts planiß in
tended to equalise as fur as possible, the poorwith
the rich, by giving to os many of them as possible,
at the expense ol the State, nri opportunity to edu
cate their sons in college, a privilege at present
confined almost exclusively to the rich, us poor
men have not means to educate their sons liowev-
tfr dstarring or promising they may be.
Übuer the plan above proposed it is not intend
ed to make n donation, or absolute gift to the col
leges, of a single dollar of the bonds of the State.
It is intended only to delivor the bonds to the col
leges and to puy to them the Interest semi-annual
ly, as a compensation for them to maintain and
educate annually, one hundred and forty young
men of promise, who could in no other way enjoy
the advantages of a liberal education; wbo in
turn are to diffuse intelligence among the great
body of the people, thereby supplying the State
with Georgia teachers well qaahned to teach the
youth of Georgia; and who would be, at the same
time, the natural friends of her institutions. As a
part of this plan, I also propose that a general
superintendent of schools lor the Slate be ap
pointed, with a salary sntlicient to secure the best
talent, whose duty it shall be to collect valuable
information upon the subject, and roport utfnually
to the Executive, to he laid before the legislature.
And to traverse the State iu every diroetton, visit
tho schools, address the people, and do all in bis
power to create a lively interest on the subject of
education.
Carry out (his plan and who can estimate its
benefits to flic State ? I regard the education of
tho children of the State as the grand object of
primary importance, which should, if necessary,
take precedence of ull other questions of Statu po
policy; for lunprehend it will be readily admitted
by every 1 intelligent person, that the stability ana
permanence of our republican institutions hang
upon the intelligence and virtue of our people.
No monarch rules here! And it is the pride of
our system of government that each citizen at the
ballot box possesses equal rights of sovereignty'
with every other one. Thanks be to our Ueavenly
father, t lie popular voice cannot here be hushed
in the silence of despotism, but the popular will
dictates the laws. May it thus ever remain! How
important it is, therefore, that the masses of the
people be educated, so each may he able to rend
and understand for himself the Constitntinn and
hlstory of his country, and to judge and decide
for himself wliat aro the true principles and poli
cy of Ills government. But how much more im
portant it is, in iny opinion, that every person in
the Htuto he enabled to read for him or herself the
Holy Bible, and to comprehend the great princi
ples of Christianity, in the eternal truths of which,
I am a firm, though humble believer. Kdncate
the masses und inculcate virtue and morality, and
you lay broad and deep, in the hearts of our peo
ple, the only sure foundations of republican liber
ty und religious toleration ; the latter of winch is
the brightest gem in the Constitution of our coun
ty.
By adopting the proposed line of policy, we
have it in our power, without increase of taxation
or burden to our people, to place Georgia, so
far as education is concerned, in the proudest
i position of any State in the Union. J,et her edu
• cate every son and daughter within her Units,
• and she may then justly boast tbat she is the em
• pire State of not only the South, but of the
whole Union. By this plan the public debt would
i be reduced, and the school fund increased, an
nually, $200,000; and the interest amounting year
ly to $20,000 on the bonds delivered to tho col
leges, would be paid semi annually, out of the
net earnings of tlio State road; and there would
still be left an annual income from tbat source
of $72,000 to be applied to other purposes.
' Reduction of lomi.— The present annual expenses
of the Government, including the civil estab
lishment, the interests on the public debt, sup
port of Asylums, Academy for the blind, State
cadets in Military Institute, Ac., amount to übout
$446,000, without including any of the extraor
dinary appropriations. The present annual in
comes to the Treasury from the State lax, the fax
on bank slock, railroads, dividends on bank slock,
aud from other miscellaneous sources, such as
copy grants, testimonials, Ac., amount to about
$446,000, exclusive of incomes from the State
road. It follows, therefore, after allowing some
$22,000 pr. annum of special appropriations, out.
side-of the actual expenses of the Government,
that the taxes might be reduced from tu incomes
of the road about $50,000 per annum besides es
tablishing and providing for the successful oper-
ation of the proposed school system. Should the
legislature, however after providiug for the re
duction of the public debt, the support of the
school system, and the education of teachers,
make any considerable appropriations, other
than those which may be absolutely necessary to
support the Government, no material reduction of
the tuxes could be made.
In the event the legislature should disapprove
of the proposition to applv the net earnings of
the road to the payment of the public debt and to
the education of the children of the State I re
spectfully recommend that $150,000 per annum in
. .stead of about fifty thousand as above proposed
be applied in reduction of the taxes of the peoi h.'
and that the surplus be used for such purpose! of
internal improvement as will tend most to the de
velopment of the resources of the State. I um
aware there are those who object to any reduction
of taxes, believing it neceaJkry in order to attach
the people to the government to raise large stuns
of money from th m by taxation, to be appropria
ted u some way by the legislature. I taft u.
different view of this subject, and believe that all
unnecessary, wasteful or extravagant appropria
tions should be avoided; and that no more taxes
should be raised than the necessities pf the State
require, under an economical administration of
the government.
I cannot believe that the people’s love for the
government would be increased by high tajatlott.
When the people were paying increased tare
; build the Western & Atlantic railroad, they were