or the payment of
interest and ultimate redemption of the principal.'

Congress adjourned after a session of eight months, and failed to adopt
Mr. Chase's recommendation. Indeed, it had then but few advocates in
Congress or the country. Events rolled on, and our debt, as anticipated
by Mr. Chase, became of vast dimensions. In his Report of December,
1861, the public debt on the 30th June, 1862 (the close of the fiscal
year), was estimated by the Secretary at $517,372,800; and it was
$514,211,371, or more than $3,000,000 less than the estimate. In his
Report of December 4, 1862, our debt, on the 30th June, 1863, was
estimated by Mr. Chase at $1,122,297,403, and it was $1,097,274,000,
being $25,023,403 less than the estimate. The _average_ rate of interest
on this debt was 3.89, being $41,927,980, of which $30,141,080 was
payable in gold, and $11,786,900 payable in Federal currency. It will
thus be seen that the whole truth, as to our heavy debt, was always
distinctly stated in advance by Mr. Chase, and that the debt has not now
quite reached his estimate. Long before the date of the second annual
Report of the Secretary, the banks had suspended specie payments, and
the Secretary renewed his former recommendation on that subject in these
words:--

'While the Secretary thus repeats the preference he has heretofore
expressed for a United States note circulation, even when issued
direct by the Government, and dependent on the action of the
Government for regulation and final redemption, over the note
circulation of the numerous and variously organized and variously
responsible banks now existing in the country; and while he now
sets forth, more fully than heretofore, the grounds of that
preference, he still adheres to the opinion expressed in his last
Report, that a circulation furnished by the Government, but issued
by banking associations, organized under a general act of Congress,
is to be preferred to either. Such a circulation, uniform in
general characteristics, and amply secured as to prompt
convertibility by national bonds deposited in the treasury, by the
associations receiving it, would unite, in his judgment, more
elements of soundness and utility than can be combined in any
other.

'A circulation composed exclusively of notes issued directly by the
Government, or of such notes and coin, is recommended mainly by two