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DEBT. payable in coin; $196,117,300 were issued at 5 per cent., to run 40 years (the 10-40s of 1864); and $3,882,500 at 6 per cent. Most of the 5 per cents. brought premiums from 1 to 7 per cent. In June, 1864, a loan of $400,000,000 was authorized at 6 per cent. (the 5-20s of 1864), of which $121,561,300 was issued. In June, 1864, Congress authorized the issue of $200,000,000 in 7-30 Treasury notes, and in March, 1865, the sum was increased by $600,000,000 more. The whole issue was $829,992,500 of 7-30 interest-bearing notes, and the whole loan was redeemed by the middle of July, 1868. In March, 1865, a loan was authorized of $600,000,000 in 6 per cent. 5-20 bonds, to be used only for the payment of Treasury notes or other obligations of the nation. Two issues were made: July 1, $322,988,950 and $379,616,050, and in July, 1868, $42,539,350, all to redeem Treasury notes and other obligations; but in no case to increase the public debt. In March, 1867, and July, 1868, there were issued $85,150,000 of temporary loan certificates of deposit, bearing interest at 3 per cent., to redeem compound-interest notes. In July, 1870, the great refunding act was passed. The Secretary of the Treasury was authorized to issue $200,000,000 at 5 per cent., $300,000,000 at 4½ per cent., and $1,000,000,000 at 4 per cent. of thirty-year bonds, principal and interest payable in coin, to be used only to redeem the 6 per cent. or other early bonds. Besides these issues, there were guarantee bonds issued to the Pacific and other railroads, secured by mortgage on the roads. In January, 1871, the 5 per cent. bonds were increased to $500,000,000.

These enormous financial transactions have no parallel for extent in the world's history. Yet for a time there was much fear that such loans could not be floated; but when they were proved possible without recourse to the capitalists of foreign countries, the loyal people of the Union had abundant cause for congratulation. The loan of 1862 ($515,000,000) was the greatest in amount and the most successful thus far attempted. Afterwards, however, loans were not easily made, and the Government was compelled to resort to currency and Treasury notes, and also compound-interest notes and certificates of indebtedness. The greatest test of the financial strength of the nation fiercely struggling to maintain its political existence was in 1864. On July 11, in that year, gold touched its highest point, $2.85, and a paper dollar was worth in gold about 38 cents.

From the period of the Civil War the surplus of revenue was applied to the public debt. As the bonds bearing the higher rates of interest were first extinguished, the interest burden diminished even more rapidly than the principal. Thus, while in 1865 the total interest-bearing debt amounted to $2,381,000,000, and the annual interest charge to $151,000,000, at its lowest point, in 1892, of $585,000,000 principal, the interest charge was, in round numbers, but $23,000,000. As the population had increased rapidly during the interval, the interest per capita had declined from $4.39 to 39 cents. After 1893 the amount of public debt was increased by the issue of bonds for the purpose of securing the Treasury against the drain upon its gold reserve. This issue of 5 per cent. bonds was followed in 1898 by a further issue of 3 per cent. bonds for the purpose of meeting the expenses of the Spanish War. By the act of March 14, 1900, the 3, 4,

and 5 per cent. bonds were made convertible into 2 per cent. bonds, which resulted in a considerable diminution of the annual interest charge. The interest-bearing debt of the United States on July 1, 1900, was made up of the following:

The annual interest charge upon this debt is $33,545,130. The following is a statement of outstanding principal of the public debt of the United States on January 1 of each year from 1791 to 1842 inclusive, and on July 1 of each year from 1843 to 1900 inclusive: