use of one-half the tonnage of each vessel engaged in the trade, except such as are owned exclusively by a State."
To the House of Representatives of the Congress of the Confederate States.
I herewith return to you an act to amend an act entitled "An Act to reduce the currency and to authorize a new issue of notes and bonds," approved February 17, 1864, with the objections which induce me to withhold my approval thereof.
Under the provisions of the act of 17 February, 1864, all Treasury notes above the denomination of five dollars not bearing interest, which shall not have been funded east of the Mississippi on 1 April, 1864, and on 1 July west of the Mississippi, are made subject to a tax of 33 1-3 cents on the dollar. Notes of the denomination of one hundred dollars are made subject to a further tax of ten per cent per month until funded ; and all these notes outstanding on 1 January, 1865, are then taxed 100 per cent.
The effect of these provisions east of the Mississippi is to reduce the nominal rate of all the notes one-third after the 1 April, to increase this reduction ten per cent per month on the one hundred dollar notes until 1 November, 1864, at which date they are extinguished, and on 1 January, 1865, to extinguish the other notes.
The amendatory act which it is now proposed to pass grants to certain persons the privilege of funding at par all these notes until 1st January, 1865; and thus in effect gives to them precisely the rights which are taken away from all other citizens by the original act.
The extent of this privilege may be measured by the fact that the one hundred dollar notes outstanding on 1 April were estimated by the Secretary of the Treasury to amount to one hundred and twenty-eight millions. In the hands of persons not embraced by the amendatory act, they have already lost one-third of their nominal value. They continue to lose 10 per cent per month, and finally, on 1 November, such as remain outstanding will cease to have any value. But in the hands of the persons described in the amendatory act they all stand good against the Government for their entire original value.