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with a few exceptions all obligations have been met without creating a state debt.

The influence of the canals on our financial policy has been noted in previous volumes; that influence again becomes manifest when we remember that four out of six statutes that have been submitted to the people for their approval under this section have related directly to canals, and that one other was chiefly concerned with this department of public affairs. The remaining statute, the bounty law of 1865, presented an extraordinary situation resulting from the Civil War, and is entirely outside the ordinary range of administration. These statutes will be considered in their order.

1859. Canal bonding act.—It seems that the financial habits formed before the restrictive policy was established were not readily changed, and that notwithstanding the prohibitions of this section obligations were created without popular approval. At the end of the last fiscal year, -September 30, 1858,—the funded debt exceeded thirty millions; but according to Governor Morgan's message to the legislature of 1859, there was a floating debt of more than four millions, a large part of which had been created regardless of the constitutional prohibition. “Without this power to create a debt, unless first submitted to the people, a debt has been created for canal purposes without the means of payment in the treasury, or at the command of those who made it; and it requires your early and deliberate consideration as to the measures necessary and proper to be adopted, to save unimpaired the public faith; for under no circumstances will the state of New York ever refuse to acknowledge and pay any and all just claims that exist against her, or that may have been contracted by any of her authorized agents."

These were plain words, but Comptroller Sanford E. Church, in his report of 1859, used equally vigorous lan

guage concerning some aspects of financial administration. Condemning the practice of making appropriations beyond available revenues, which "should never be indulged in, except under the most absolute necessity," and “can never be done without a violation of good faith and constitutional obligations," he said obligations were often "created by this indirect mode without providing means to discharge them;" and that the creation of a floating debt "had been more the result of that loose and irresponsible system which has obtained in the management of the finances and the prosecution of the public works of this state, than from any affirmative intention on the part of public officers to commit the offense of violating the fundamental law; but its effect is nevertheless equally injurious and pernicious.

The circumstances under which this large liability has grown up, and the strong equity of those who hold the evidences of it, ought to be deemed a justification for its assumption and prompt payment by the state; but as a precedent it should be repudiated and its repetition in future prevented by penal laws.”

Acting on the foregoing suggestions, the legislature determined to provide for the payment of the floating debt by a loan of two and a half millions; and an act was accordingly passed (chapter 271) submitting to the people the question of creating a state debt for this purpose. The law was accordingly submitted at the general election in November, 1859, and approved by a vote of 125,370 to 77,466.

The large negative vote justified Governor Morgan's observation in his message of 1860 that “the popular vote by which this new loan was authorized is such as to show that, while the people of New York have ever been prompt to meet all just obligations, they will not be likely again to sanction the payment of any debt not author

ized by the Constitution and the laws, no matter for what purpose, or under what circumstances incurred." Commenting on another act passed on the 6th of April, 1859, which prohibited the creation of any similar obligations in future, the Governor said this statute "doubtless contributed much to induce the people to authorize the payment of those which existed.” Following Comptroller Church's suggestion in 1859, the Governor said further that, in his opinion, the provisions of that act "might properly be extended so as to affix a penalty to the creation of any such indebtedness in future. This would effectually carry out the constitutional prohibition, and prevent the people of the state from ever again being placed in the dilemma of paying an unauthorized debt, or seemingly incurring the stain of repudiation.”

1865. Civil War bounties. The origin of military bounties during the Civil War (1861-5) is described by Governor Seymour in his message to the legislature of 1863. The President's two calls for troops in the summer of 1862—each for 300,000 men—required the enlistment of 120,000 men in New York. Referring to the situation presented by these calls, which were made during the last year of Governor Morgan's administration, Governor Seymour said: "It was believed that if suitable bounties were offered, a conscription could be avoided. But no payment could be made from the state treasury without legislative authority;" and this authority could not be obtained without a special session of the legislature. “The Commercial Bank of Albany offered to advance the requisite sum for bounties, and to assume the risk of reimbursement by the legislature at its annual session.” This offer was accepted, and Governor Morgan issued a proclamation on the 17th of July, 1862, offering a bounty of $50 to each volunteer private soldier. Goyernor Seymour recommended the passage of a law ratify

VOL IV. Const. Hist.—41.

ing Governor Morgan's action, and making appropriations for the payment of bounties. The act of 1863 (chap. 14) appropriated $3,600,000 for the payment of bounties to volunteers under Governor Morgan's proclamation, and directed the comptroller to reimburse the Commercial Bank of Albany for its advances. Governor Seymour also said that large local bounties had been offered for volunteers, and recommended legislation ratifying this action by municipalities. Several statutes were passed in 1863 charging these bounties on the municipalities affected, and providing for their payment by taxation.

The legislature of 1864 passed several statutes relative to bounties, both state and local, and also, by separate concurrent resolutions, authorized the comptroller and the Governor to borrow money for the payment of bounties, but without limiting the amount.

The bounty system was in many respects unsatisfactory. Under the law, bounties to an unlimited amount might have been offered by municipalities in response to a call for troops, but no bounties could have been paid for volunteers in anticipation of future calls. Governor Fenton, discussing this situation in his message of 1865, says: “The result is that large numbers of men have to be raised in a very limited time, and, under the excitement and competition, localities are constantly overbidding each other, while the men who intend to volunteer hold back until this competition shall have realized for them the highest possible offers. The bounties thus actually paid to volunteers are very unequal, and are often the cause of dissatisfaction among the recruits after they have entered the service." The Governor suggested legislation fixing the maximum amount of bounties payable by taxation, and authorizing localities to provide for future contingencies.

The Governor's suggestion that the maximum amount

payable for bounties should be limited by law evidently reflected a growing popular opinion. The latter part of 1864 and the beginning of 1865 were marked by considerable discussion in different parts of the state concerning the policy of paying bounties, and the proper adjustment of the system. The legislature of 1865 received numerous petitions early in the session for the enactment of laws fixing the maximum amount payable for bounties. There was also a movement to make all bounties payable by the state. In December, 1864, the board of supervisors of Steuben county adopted resolutions recommending the maximum limit of bounties, and also that bounties be payable by the state. This suggestion was apparently received with favor, and in January, 1865, a convention of representatives of boards of supervisors was held at Albany, and considered various questions relating to the payment of bounties. This convention adopted a series of resolutions containing recommendations that "all bounties to volunteers should be paid by the state, and ultimately by the United States,” that the maximum amount of bounties be limited by law, according to the length of service; that provision be made by law for raising money on the bonds of the state for the payment of bounties; and that the legislature be requested to enact appropriate legislation for the purpose of carrying the recommendations into effect. These resolutions were duly transmitted to the legislature of 1865, which thus had before it the situation presented by the operation of existing bounty laws, and also the suggestions contained in the Governor's message, in petitions presented by many citizens, and in the resolutions adopted by representatives of boards of supervisors.

Here was ample warrant for legislative consideration of a most important public question. Legislation limiting the maximum amount of bounties was manifestly

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