G. A. Trenholm to F. 8. Lyon, December 15, 1864

Hon. F. 8. LYON, Chairman Committee on Ways and Means:

Sir: The near approach of the end of the quarter admonishes me strongly of the condition to which the Treasury will then be reduced. By reference to page 6 of the report I had the honor of submitting to Congress, it will be seen that the expenditures of the current quarter will absorb all that remains of the resources in ready money. Nothing will remain at the end of the year but the certificates of indebtedness and the non-taxable bonds. For the first, the demand is extremely limited, and the amount to be realized from this source need hardly be taken into account. For the bonds, the demand is by no means equal to the sum allowed in my estimate of resources of the year. I beg to refer you to page 11 of the report, by which it will be seen that I rely upon the sale of bonds for $409,000,000.

From the Ist of January, 1865, to the 30th of June, the demands upon the Treasury, upon the most moderate estimate, will be as follows, viz:

INET OAT OL Uae Mencia eed A Fay shea Neon ee a aE oe aS $114, 000, 000 Redemption of notes as proposed (one- FLING) — § crac Ser Re as eee 30, 000, 000 IDbg errehiunitess, Cibo uO Ml 3.26 sae ne odo e eee coe aacoSsaes se sae eee 800, 000,

Wo} 229 ee ae eee ease ee See eae ewes sae eT ESL 444, 000, 000 To meet these demands, I rely upon—

Receiptol- thertax 1 kn) Cieaerersene oor ere ie aero ee me ee ee $145, 000, 000 Half the money tax proposed ($215, 000,000)_…-.-.—–..——– 107, 500, 0CO Half the sale of bonds estimated for the year ($409, 000,000) _—_–. 204, 500,

do} 31 eesti ered et ee ais! Same ee AS Nee Ss ir tS Se 457, 000,

I beg the committee to take notice that on the 1st day of January the Treasury will be entirely empty; and that there will be nothing after that day to satisfy the requisitions but the funds to arise from the sale of bonds.

Assuming that the recommendations I have ventured to submit in relation to the money tax (which is clearly indispensable) shall be adopted, the collection from that source will not begin to come in before the month of June; but I rely with confidence upon the ability to anticipate the collections to the extent of $107,000,000 by temporary loans.

There is obviously some risk of embarrassment in depending upon this expedient, but it is all that can be done apparently under existing circumstances, and I would respectfully and earnestly impress upon the committee the importance of acting with promptitude, and thereby inspiring confidence in the adequacy of our future resources.

That a money tax is indispensable is plain; that less than the sum mentioned in the report will be insufficient seems equally clear, and I venture with great deference to suggest that the plan of taxation proposed will raise the requisite amount, and is strongly reeommended by the consideration that it makes the smallest possible departure from the existing system.

With renewed thanks to the committee for the patient attention they have accorded to the communications I have been impelled by a sense of duty to address them,

I have the honor to remain, your most obedient servant,