a great part of them may be taken up, and is rapidly approaching when
all may be. It is believed that all which are now due may be replaced by
bonds bearing a rate of interest not exceeding 4-1/2 per cent, and as
rapidly as the remainder become due that they may be replaced in the
same way. To accomplish this it may be necessary to authorize the
interest to be paid at either of three or four of the money centers
of Europe, or by any assistant treasurer of the United States, at
the option of the holder of the bond. I suggest this subject for the
consideration of Congress, and also, simultaneously with this, the
propriety of redeeming our currency, as before suggested, at its market
value at the time the law goes into effect, increasing the rate at which
currency shall be bought and sold from day to day or week to week, at
the same rate of interest as Government pays upon its bonds.

The subjects of tariff and internal taxation will necessarily receive
your attention. The revenues of the country are greater than the
requirements, and may with safety be reduced. But as the funding of
the debt in a 4 or a 4-1/2 per cent loan would reduce annual current
expenses largely, thus, after funding, justifying a greater reduction
of taxation than would be now expedient, I suggest postponement of this
question until the next meeting of Congress.

It may be advisable to modify taxation and tariff in instances where
unjust or burdensome discriminations are made by the present laws, but
a general revision of the laws regulating this subject I recommend the
postponement of for the present. I also suggest the renewal of the tax
on incomes, but at a reduced rate, say of 3 per cent, and this tax to
expire in three years.

With the funding of the national debt, as here suggested, I feel safe in