Page:Vol 5 History of Mexico by H H Bancroft.djvu/583

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REORGANIZATION OF THE TREASURY.
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government.[1] Under such circumstances and with the fear of future repudiation, such loud remonstrances were made by certain creditors, notably by the clergy and by foreigners under ministerial protection, that the plan had to be modified and infringed in a number of cases,[2] thus defeating its main object.

As a means to enforce the reorganization of the treasury, and the reduction in expenses, a law of November 1849 limited the administrative expenses to $500,000 a month, whereof two thirds were for the war department.[3] This involved a reduction on salaries of one fourth for officials in actual service, and one third for others, which in itself produced a pressure that caused the limit to be ignored and also an increased draft on the convenient United States indemnity money[4] to cover the usual deficit, besides a continued anticipation of custom-house revenue, contrary to all intentions. One reason for the deficits lay in the tariff reductions and other charges imposed during the recent occupation, and which necessitated a subsequent corresponding abatement on the restored tariff

  1. Minister Esteva, who succeeded Payno for a brief period as finance minister, condemns the law as a blow against the national credit. 'La ley declaró la bancarota, si no total, á lo ménos parcialmente.' Espos., 9, Mar. 28, 1851. Payno naturally rose to defend the object of the plan. The consolidation into one fund would reveal the extent of the indebtedness and diminish much of the financial confusion, destroy the jealousy existing between different classes of creditors, procure gain for the treasury, throw into circulation a large amount of now hidden and useless money, and join personal with national interests. Mem. of June 30, 1852, 14-16. He deplores infringements on the plan.
  2. Instance law of May 19, 1852, Méx., Legisl. Mej., 1852, 112-17, which also imposes a contingent on the states to aid the fund. Hardly any of the foreign debts were properly left with the fund. The claims, for example, of Fort & Co. and Drusina, for about $1,200,000, were covered by an arrangement of Jan. 21, 1851, offering $300,000 from the U. S. indemnity, $600,000 from half of the tax on circulated and exported money, and the balance in the new bond. Rules for these foreign conventions in Convenciones Diplom., 1852, 1-31.
  3. Arrillaga, Recop., 1849, 163-6. The apportionment stood $333,333 for army and navy, $61,273 for treasury, $18,993 for justice, $53,810 for the relations department, $33,482 for the congress, and $2,250 for the executive.
  4. Which had been partly authorized by the above and other decrees. Concerning the payment of the indemnity, see U. S. Govt Doc., Cong. 31, Ses. 2, Sen. 31, iii; Id., Cong. 31, Ses. 1, Acts and Res., 79; Universal, Feb. 16, 20, 27, Маy 2, 1850, etc.; Мéх., Сol. Ley. у Dec., 1850, 113-14, 198; Id., Col. Ley., Dec. y Órd., 1850–1, i. 74-5.