The reduction of the annual interest on the public debt through these
transactions is as follows:


By reduction of interest to 3-1/2 per cent. $10,473,952.25
By redemption of bonds 6,352,340.00
_____________
Total 16,826,292.25


The 3-1/2 per cent bonds, being payable at the pleasure of the
Government, are available for the investment of surplus revenues without
the payment of premiums.

Unless these bonds can be funded at a much lower rate of interest than
they now bear, I agree with the Secretary of the Treasury that no
legislation respecting them is desirable.

It is a matter for congratulation that the business of the country
has been so prosperous during the past year as to yield by taxation
a large surplus of income to the Government. If the revenue laws remain
unchanged, this surplus must year by year increase, on account of the
reduction of the public debt and its burden of interest and because
of the rapid increase of our population. In 1860, just prior to the
institution of our internal-revenue system, our population but slightly
exceeded 30,000,000; by the census of 1880 it is now found to exceed
50,000,000. It is estimated that even if the annual receipts and
expenditures should continue as at present the entire debt could be
paid in ten years.