The Online Library of Liberty

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• Preface of the Author.
• An Essay On the Danger of Too Much Circulating Cash In a State, the Ill Consequences Thence Arising, and the Necessary Remedies. [ Published In the Pennsylvania Evening Post of Oct. 5, 1776, Under the Signature of a Financier. ]
• An Essay On Free Trade and Finance. First Published In Philadelphia, July 1779, and Dedicated to Congress.
• A Second Essay On Free Trade and Finance. First Published In Philadelphia, August 1779, and Dedicated to the Several Legislatures of the American Union.
• A Third Essay On Free Trade and Finance. [ Published In Philadelphia, January 8 Th, 1780.]
• A Fourth Essay On Free Trade and Finance. First Published In Philadelphia, February 10, 1780.
• A Fifth Essay On Free Trade and Finance. First Published In Philadelphia, March 30, 1780.
• Strictures On Tender-acts. * [ First Published In Philadelphia, Dec. 13, 1780.]
• An Essay Or Humble Attempt to Examine and State the True Interest of Pennsylvania With Respect to the Paper Currency. [ First Published In Philadelphia, Dec. 13, 1780.]
• An Essay On the Economy, Policy, and Resources of the Thirteen States, and the Means of Their Preservation. [ First Published In Philadelphia , In January 1781.]
• A Dissertation On the Nature, Authority, and Uses of the Office of a Financier-general, Or Superintendant of the Finances. [ First Published In Philadelphia, Jan. 24, 1781.]
• Remarks On the Resolution of Council, of the 2 D of May, 1781, For Raising the Exchange to 175 Continental Dollars For 1 Hard. Humbly Offered to the Public. [ First Published In Philadelphia, May 9, 1781.]
• Strictures On a Publication In the Freeman’s Journal of May 16, 1781, Signed Timoleon. * [ First Published In Philadelphia, May 23, 1781.]
• Strictures On Two Publications In the Freeman’s Journal of May 30, 1781, Signed Phocion, and Impartial. * [ First Published In Philadelphia, May 23, 1781.]
• A Dissertation On the Political Union and Constitution of the Thirteen United States of North-america, Which Is Necessary to Their Preservation and Happiness; Humbly Offered to the Public. * [ First Published In Philadelphia, 1783.]
• A Sixth Essay On Free Trade and Finance. Particularly Showing What Supplies of Public Revenue May Be Drawn From Merchandise, Without Injuring Our Trade, Or Burdening Our People.
• A Seventh Essay On Free Trade and Finance; In Which the Expediency of Funding the Public Securities; Striking Further Sums of Paper Money, and Other Important Matters, Are Considered. * [ First Published In Philadelphia, Jan. 10, 1785.]
• A Plea For the Poor Soldiers: Or, an Essay to Demonstrate That the Soldiers and Other Public Creditors, Who Really and Actually Supported the Burden of the Late War, Have Not Been Paid, Ought to Be Paid, Can Be Paid, and Must Be Paid. [ Fir
• A Review of the Principles and Arguments of the Two Foregoing Essays, Viz. the Seventh Essay On Finance, and the Plea For the Poor Soldiers; With Some Observations On the Finances of the Union.
• An Essay On the Seat of the Federal Government, and the Exclusive Jurisdiction of Congress Over a Ten Miles District; With Observations On the Economy and Delicate Morals Necessary to Be Observed In Infant States. [ First Published In Philadelphia, Sep
• Remarks On the Address of Sixteen Members of the Assembly of Pennsylvania, to Their Constituents, Dated September 29, 1787. With Some Strictures On Their Objections to the Constitution Recommended By the Late Federal Convention. * [ First Publish
• The Weaknesses of Brutus Exposed: Or, Some Remarks In Vindication of the Constitution Proposed By the Late Federal Convention, Against to Objections and Gloomy Fears of That Writer. [ First Published In Philadelphia, Nov. 4, 1787.]
• An Essay On Credit: In Which the Doctrine of Banks Is Considered, and Some Remarks Are Made On the Present State of the Bank of North-america. [ First Published In Philadelphia, Feb. 10, 1786.]
• Strictures On the Net Produce of the Taxes of Great-britain, In the Year 1784, As Published By Order of Their House of Commons. [ First Published In Philadelphia, Aug. 4, 1785.]
• An Essay On Test-acts Imposed With Penalties. * [ First Published In Philadelphia, Sept. 12, 1781.]
• An Essay On the Extent and Value of Our Western Unlocated Lands, and the Proper Method of Disposing of Them, So As to Gain the Greatest Possible Advantage From Them. [ First Published In Philadelphia, April 25, 1781.]
• Scales of Depreciation of Continental Money.
• A Chronological Table of Remarkable Events.

A THIRD ESSAY ON Free Trade and Finance.

[Published in Philadelphia, January 8th, 1780.]

CREDIT, either public or private, may always be kept good, where there is a sufficient estate to support it. Therefore, if private persons, a company of merchants, or a State, suffer their credit to decay, when they have a sufficient stock to support it, their management must be bad, but their affairs can never be desperate so long as their stock or estate continues sufficient to discharge all demands on them; their bad management only need be corrected, and a good one adopted, and their affairs may be retrieved, and their credit restored. Therefore, the Thirteen United States are not bankrupt, nor are their affairs desperate, tho’ their credit runs very low, and their finances are in the worst condition. We have men enough for every purpose—We have provisions and stores enough. Our houses, lands, and stock on the lands, are little diminished, and in many places increased, since the war began; yet our credit runs so low, that it is with great difficulty sufficient supplies can be obtained.

The error lies in our finances, or management of the public stock, and must be mended, or we are ruined. In the midst of full plenty we already suffer the want of all things.

The first thing necessary to correcting an error, is to discover it, the next is to confess it, and the last to avoid it. Perhaps neither of these three things are easy in the present case. An error in finances, like a leak in a ship, may be obvious in the fact, alarming in its effects, but difficult to find. The fact in view affords perhaps are strongest proof of this. Our finances have, for five years past, been under the management of fifty men, of the best abilities and most spotless integrity, that could be elected out of the Thirteen States; yet they are in a ruined condition. We have suffered more from this than from every other cause of calamity: it has killed more men, pervaded and corrupted the choicest interests of our country more, and done more injustice, than even the arms and artifices of our enemies; still the fatal error continues unmended, and perhaps unexplored.

Our admiration and censure will be greatly diminished here, when we consider that the doctrine of finance, or the nature, effects, and operation of money may be placed among the most abstruse and intricate subjects, which we ever have occasion to examine. Not one in ten thousand is capable of understanding it, and perhaps not one man in the world was ever complete master of it.

As a full proof of this, I adduce the many fruitless attempts to stop the depreciation of our currency, which have been adopted both in and out of Congress; all of which have failed of the expected success, and many of them have greatly increased the mischief they were intended to remedy. The various schemes and plans for the same purpose, which have been formed and proposed by many men of most acknowledged abilities, warmly adopted by some, and as warmly opposed by others, are a further proof of the great difficulty and abstruse nature of the subject.

The universal distress of the country, arising from this error in our finances, makes it a subject of the most interesting importance, and the most universal inquiry, yet the intellectual powers of the Continent, tho’ wound up to the highest pitch of attention, have not yet been able to find a remedy. The evil still continues as unchecked as ever. It seems impossible to control or compute its force; it baffles all calculation. Yet so are we situated, and so critical is the present moment, that a remedy must be found, or we perish.

The morality and industry of our people are declining fast. Our laws become iniquitous, and the worst of all sin is that iniquity which is framed by a law, for it fixes the mischief in the very place where a remedy ought always to be sought and found. The confidence of our people in the government is lessened, our army suffers, and our credit and character abroad is in danger of contempt. All these, and no man can tell how many more, evils, hang like a thick cloud over us, the bursting of which will overwhelm us. But this is no time or place for declamation; a remedy is the thing to be sought; a remedy or ruin are the only two alternatives before us.

I have twice essayed to throw some light on this dark subject, with very little effect; my system, however some of its parts were approved, has not been adopted. My arguments, perhaps, were not thought conclusive, or were not sufficiently clear, and therefore were little attended to; I will, nevertheless, once more attempt to lay before the public, some principles and propositions which appear to me to have great weight, and which I shall ground on fact as much as I can; for in this, as in natural philosophy, one experiment I conceive to be better, and stronger proof than an hundred theorems.

I. In every State where the occasions of money continue unvaried, the incomes and expenditures ought to be kept equal, otherwise the value of money will fluctuate, i. e. increase or decrease; by which every money-contract, as well as all legacies, salaries, fees of public offices, rents, &c. will be altered, and the money, when paid, will be either more or less than was intended in the contract, in the law, &c. In this case, it matters little whether the increase of money proceeds from foreign loans or gifts, from opening mines, or presses; an increase of money in any of these or any other way, will, with great injustice, alter the value of the payment, to the manifest wrong and injury of the receiver; by which the law itself, as well as the contract or donation, becomes perverted and corrupted, and is made to enure contrary to the original intention of all the parties concerned; this is proved by very sad experiment among ourselves.

Hence it appears from plain experiment, that any method that tends to increase or decrease the quantity of circulating cash, will not prove a remedy, but will increase the evil, or run us into the contrary extreme, equally unjust and mischievous, or perhaps more fatal. Hence it follows, that our true remedy, must, in the nature of the thing, lie, not in appreciating, more than in depreciating, the currency, but in fixing the value of it where it is, and keeping it to fixed, that any man who makes a money-contract, may find, when the day of payment comes, that the money paid is just the same as it was at the time of contract, that so the money paid may exactly correspond with the intention of the contract, and be of course a just fulfilment of it without increase or decrease; which cannot possibly happen where there is any fluctuation of its value between the times of contract and payment.

Hence, when the value of money is fixed and can be kept so, it is in the most perfect state its nature is capable of, and does, in the most perfect manner, answer all the purposes and uses which are desired or expected from it; for it is impossible that money should exist in higher perfection, than when it is of such fixed and certain value that all other articles may be compared with it, and their value safely estimated from that comparison.

Hence it follows clearly, that as far as money deviates from a fixed value, and becomes fluctuating, it loses its use, and becomes dangerous to the possessor, and this will of course, without any regard to its quantity, lessen its value, or increase its depreciation; and this may be assigned as one great cause of the present depreciation of our currency beyond what its quantity would require.

Hence it follows, that if money can obtain a fixed value, it is of no manner of consequence what the quantity is, for its value will ever fix at that rate or proportion to the occasions for money, which will make the one equal to the other, and of course our Continental money will have just the same use, if the value of it fixes at two pence the dollar, as at any other sum that can be named; but if that value of two pence is variable and like to be reduced to a penny, every man would prefer two pence of fixed money to it; but if that value of two pence is fixed, it will be considered by every man just as good, and no better than two pence of any other sort of fixed money.

II. As the use and design of money is to be a medium of all trade, it is necessary that the demand for money should be at least equal to the demand for every thing else which is to be bought or sold, for if there is one thing to be sold, which money will not purchase, the use of money is not so great as it would be if it would buy every thing, and therefore its value is so far depreciated. Trade is carried on by the medium of money easier than in any other way, and for that reason it was introduced. An over plenty or scarcity of money introduces barter, which takes away the use of money so far as it extends, and consequently depreciates it, and perhaps the great practice of bartering one scarce article for another, which has been introduced by the great plenty of money among us, may be assigned as one great cause of the depreciation of our currency beyond what the quantity would require.

Hence it follows that the only possible way to restore our money to its true value and use, is to increase the demand for it; but this cannot be done by opening mines or presses, by foreign loans or importations of money, but may be done by taxes, which make a demand for money all over the Thirteen States, and from every taxable in it. In this every one is agreed. The only question is, How far this demand is to be increased? The answer is easy, viz. Till all supplies which we need can be purchased for money, which will certainly be the case, when the demand for money is sufficiently great.

This demand may be raised at any time, and to any pitch we please, by taxes; so that the true and only possible remedy of the great mischief lies constantly in our power, and may be put in practice whenever we please. But it must be put into actual practice; talking about it, voting about it, making assessments and tax bills, will not do without an actual and seasonable collection and payment into the treasury.

That this may be done, so as to give a fixed and established permanancy to our currency; and thereby save the States, and at the same time relieve every individual from the danger, damage, and anxiety he now suffers from the deficiency of our currency; and avoid oppression of individuals, and thereby put an end to all uneasinesses in the government: that this may be done, I say, the several things following must be strictly attended to.

1. That the taxation be fair and equitable, so as to bring the burden equally or in due proportion on each State, and on the individuals of each State. The first is the business of Congress, the second of every particular State. As to the first, it is absolutely necessary that there be an estimate made of the abilities of each State, on which the quotas are to be grounded; and this I think cannot be done better than by making the number of souls in each State the rule of it.* This can easily be obtained with exactness and certainty, and will be as just and true a measure of the abilities of each State as can be obtained. If more need to be said on this, it may be deferred to another time.

2. It is further absolutely necessary, that the quotas of each State be estimated in hard money, payable in Continental money at the exchange which exists in each particular State at the time they pay their tax into the Continental Treasury: hard money is a fixed standard of value, and can never vary much here from its value in Europe, and therefore fixing the quotas by this standard, will prevent any irregularities which will arise from depreciation of our currency between the time of the demand of the quotas, and the time of payment by each State; without this the depreciation might afford an inducement, tho’ a very wicked one, to some States, to make their collections and payments dilatory, for there would be an advantage in delaying payment of taxes, as well as of every other debt, if the sum should lessen every day, and it has been found in fact, tho’ little to the honor of the tardy States, that some States have paid their quotas, when the exchange was four to one, whilst others have paid their quotas of the same tax at the exchange of twenty for one, i. e. just one fifth part of the just debt.

I said that the payments ought to be made at the exchange that subsists in the State that pays the money, at the time of payment, for all supplies which are purchased for the use of the public in that State, are purchased at that exchange, and therefore it is reasonable that their quotas of taxes should be paid at the same exchange, whether it be higher or lower than that which exists in the other States at the same time.

Besides, if the quotas demanded of each State be not made in fixed money, it is not at all certain they will be sufficient when paid; for if the estimates of expenditures were made in money at twenty for one, and the tax demanded be made out accordingly, it is very certain if it should be paid at forty for one, it would not satisfy more than half the estimate, and therefore must be deficient by one half, and the work is all to do over again to get the other half collected and paid, besides all the dangers and damages which may arise from the delay.

Nor do I see that any reasonable objection could be made to the justice of crediting the States for their past payments by the same rule; for it is surely wrong that a dilatory State that has really paid but one fifth part of the value of her quota, should have credit for the whole: but whatever may be thought proper with respect to the time past, I think there can be no doubt that such scandalous and dangerous mischiefs should be well guarded against in time to come. To all this it ought to be further added, that when any State delays to collect their taxes, the money will accumulate, and consequently depreciate faster in it than in other States where the tax is quickly collected; and no reason can be given, why any State should take advantage of that depreciation which their own iniquitous delay has occasioned.

It is further necessary that each delinquent State should be charged with the interest of all such parts of their several quotas which shall be unpaid at the time prescribed by Congress, till payment be made; and for the same reason they should be allowed interest on all such sums as may be paid before the said time of payment, till such time of payment comes; and if all this, together with the honor and zeal of the several States, should be insufficient to prevent deficiencies, further methods should be adopted and effectually executed, till such deficiencies shall be prevented; for the very idea of supporting the union, dignity, public faith, and even safety of the Thirteen States, without good punctuality in each State, is most manifestly chimerical, vain, and ridiculous; for there can never be any confidence placed in our administration, if their counsels, covenants, and measures, must be ever liable to be rendered fruitless or impracticable by the deficiencies of one or two of those States.

3. On the part of the particular States, it is necessary that each of them at the beginning of each year should have a list or assessment of all taxables completed, and all appeals adjusted, and good collectors appointed, that as soon as any tax is granted by their Legislature, it may be put immediately into the collectors’ hands, and the collection be finished and the money paid into the Continental Treasury, without loss of time. If matters were once put into this train, any necessary sum demanded by Congress might be collected, and ready for use in a very short time; and this will fully obviate the great objection, that taxes, tho’ acknowledged to be the only sure and final remedy, are yet too slow in their operation to be depended on.

It appears from this view, that taxes are a much more certain and speedy supply, and may be depended on with much greater safety than any other method which has been pointed out to me, and they are a final, a finished remedy; whereas loans, lotteries, annuities, and every other method which I have heard of, are no more than temporary expedients, are but plausible anticipations of our revenue, and all look forward to a burden to be imposed in future time, which had better be borne now, and be finally done with.

And as I propose that all the estimates of Congress, and all the quotas demanded of the States, should be made out in hard money, so I also propose that the taxes may be made out in the same money, payable either in hard money or Continental, at the option of the person who pays the tax. Sundry material advantages I conceive will arise from this:

1. Many persons out of trade have no money but hard, and when called on for the tax, may be compelled to part with their hard money, at an unreasonable exchange, which will be avoided if hard money itself will pay the tax.

2. This will preserve the tax from any possibility of fluctuation, by the depreciation or appreciation of the currency, for if any person thinks the exchange demanded unreasonable, he may pay it in hard money, and then he is sure not to pay either too much or too little.

3. This will gradually bring sums of hard money, perhaps not inconsiderable, into the Continental Treasury, which may be so used as to prevent drawing on Europe, and thereby increasing our foreign debt, which I conceive an object greatly worth attention.

4. This will exhibit the tax to view in its real value, and prevent the terrors which may arise from the enormous found in Continental money.

5. This would greatly tend in a short course of time to reduce all our private contracts to the fixed standard of hard money, by which we should avoid that vortex of fluctuation and uncertainty, which has rendered all our private dealings precarious, and made even our profits rather the effect of chance, than of wise calculation and industry. Nor do I think that this would at all prejudice the real use of the Continental money, for it would still pass at its exchange or value.

Indeed I do not see that the depreciation of the money would have been in itself a calamity half so ruinous as it has proved, if it had operated only on the cash in being; it would have been a tax upon every possessor of it, and would have lessened the public debt, for it is manifest that the public debt at the exchange of forty for one, is but half what it was when the exchange was twenty for one; and as that money was perhaps as equally diffused over the Thirteen States, as any other property, the tax might have operated with a tolerable degree of justice; but the case was altered when the depreciation was not confined to the Continental money only, but drew every thing else after it: when it came to operate on every debt and money-contract, on every legacy, salary, public fee and fine, yea, on the finances of the States, so as to destroy all calculation of both supplies and expenditures, the mischief became infinite: we were both in our private affairs and public councils, thrown into confusion inextricable.

New objects, new effects, started up to view in every quarter, which no discernment could foresee, nor wisdom obviate, and like an inchantment of fairy visions, bewildered us all in such a maze of errors, interwoven with such subtilty into every branch of our movements, that no one department was free of them; and we all stand trembling this moment before this monster of depreciation, like bewildered travellers in a giant’s castle, where the bones of broken fortunes are every where in sight, with the spectres of widows and fatherless, and a thousand others, which the monster has devoured, and is still devouring as greedy as ever.

This mischief will be greatly lessened, if, by reducing all our debts and demands, public and private, to the standard of hard money, we can confine the depreciation of the money to itself, and prevent its operation on all other money-contracts and securities, and this will, in my opinion, greatly tend to cure the depreciation itself, because in that case no man can gain any thing by the depreciation, but every man who has any cash must lose by it; and when private interest is brought into a coincidence with the public good, they will greatly help each other.

But be all this as it may, let us not lose sight of the principal argument, viz. that no project or scheme to stop the depreciation can have the desired effect, if it does not increase the demand for our currency; and on the contrary, any scheme whatever that will increase the demand for our currency, will lessen or check the depreciation. Hence we see how vain all propositions must be, which, by their natural operation, will increase cash among us, and thereby lessen the demand for it, or increase the national debt beyond all probability of payment, and thereby lessen the public credit, and of course lessen also the demand for the currency which depends on it. Of this sort are all loans, foreign and domestic; for as long as people can get money without earning it, without actually raising and paying it, it will not appear so precious, nor can the demand be so great, as when these great and necessary conditions are the only terms of acquiring it. Hence also, every project which lessens the use of our currency, lessens also the demand for it, and cannot possibly help, but will hurt, it; such as barter in trade or levying taxes in kind* in finance.

My great proposition is, that by taxes we have it always in our power to fix our currency at any value we please; because, by this way, we may raise the demand for money just as high as we please, and, if we have not great prudence, much higher than the public good requires; and if the method and train proposed, be adopted, the operation of taxes may be made more quick and more sure, than in any other I know of. This is dealing in realities. We have dealt in shadows and delusions too long already for our honor, too long for our safety. It is not only wicked, dishonorable, and dangerous, but it is weak and absurd, to suppose that we can any longer produce our public supplies out of shadows and visionary projects; the baseless fabric will vanish; our resources consist in real substance only, and from thence alone can our supplies be produced, and let them be collected by an equable tax, and the burden on the public will not be any thing near so heavy and ruinous, as the numberless mischiefs of the depreciation have proved for four years past.

But it may be asked, What is to be done in the present distress? How are our present, immediate wants to be relieved? The answer must lie in a pretty narrow compass. I know of but three things that can be done in the case: 1. To borrow money, which is fatal in its operation, and uncertain in its effects. 2. To set the presses a going again, which will not only increase the mischief, but destroy the operation of any remedy. Or, 3. do without supplies awhile. If the crows cannot be killed, nor the carcass be removed out of their reach, the sure way is to let them eat it all up to the very bones, and then they will go away of their own accord; and this is better than to have Tityus’s vulture for ever gnawing on our liver, and our liver growing at the same time as fast as he eats it. Here is indeed a notable difficulty which would vanish into nothing, if there was a proper connexion formed between the great resources of the Thirteen States, the real substance, the mighty wealth which they contain, and the credit of the States, necessary to collect them, and bring them to public use, when the public safety or convenience requires them. The credit of our currrency is too lax, too enervated, and feeble for this; people have more of it already than they have use for, and the depreciation makes it a dangerous article to keep on hand: it is like perishable goods, which are lost in the keeping. In the nature of the thing there is nor can be no remedy for this, but increasing the demand for the currency, and this can be done in no other way than by an universal tax, which alone can create an universal demand, and this demand must operate on those persons who have the necessary supplies, so as to make their necessity for money equal to the necessity of the purchaser of the supplies.

This will put the contracting parties on a par of equal necessity on each side, which alone can ever produce an equal bargain, and is the real, natural source of all trade. Filling the Treasury never so full of money by Loans or any other way, will not effect the purpose, unless demanded of the very persons who have the supplies in their hands, for in any other way, their necessity for money will not be increased, and of course they will withhold the supplies, or demand an unreasonable price, when they see a great necessity on the purchaser, and none on themselves.

I appeal to every person who deals, whether this is not the true fact. Let a person who is under necessity of an article, apply to one who has it, but is under no necessity to sell it, he must give any price that is asked. Let a man who is under necessity of selling an article, apply to one to purchase, who is under no necessity of buying, he must take what is offered. This may be thought a resinement of argument, but I appeal to every man, the least or the most versed in trade, if this is not the universal principle of all trade, and if it is not the universal practice of all wise traders, if they are under a necessity of buying or selling, to conceal that necessity as far as they can, lest it should put them under disadvantage in making their bargain.

It is further to be observed, that an increased demand for money is the only thing which will naturally excite great diligence and pains in procuring such articles as will bring it; therefore, it appears that this is the only true means of restoring the decayed industry of our people, without which we shall soon have no supplies raised, and then we must be destitute indeed, for no demand for money can produce supplies which are not in existence, which to me appears to be a matter worthy of very great attention.

Every idea of a loan either at home or abroad, operates directly against these great principles, and directly tends to increase our distress.*

I abhor and execrate every idea of a foreign loan to purchase necessaries produced among ourselves; it may be necessary to borrow in Europe money sufficient to purchase what we must export from thence, and enough to make former contracts punctually and honestly good; but to borrow money in Europe to pay for supplies produced here among ourselves, appears to me the height of absurdity: this exposes our weakness to all the world; not our weakness in point of supplies; not the exhausted state of our country, for that is full of every thing we want, clothing and military stores excepted; but the weakness of our counsels and administration, that our domestic economy should be so bad, that we should not be able to call into public use the very supplies in which the country abounds, is shameful: such an imbecility of counsels, I imagine, will hold us up in so very contemptible a light in Europe as will effectually destroy all our credit there, and thereby put it out of our power to destroy ourselves; but if this should not be the case, I do not see but our independence, with all the blessings resulting from it, is in danger: for I really fear that some among us would, without concern, mortgage the Thirteen States up to the value of every acre they contain, to any foreign power that will trust us.

It is as necessary that we preserve ourselves independent of France, Spain, and Holland, as of England. It is manifest beyond any need of proof, that the nation who is in debt to a superior power, cannot be free and independent, but is ever liable to demands the most insulting and inconsistent with freedom and safery.

But if after all, nothing can stop the career of this fatal measure of contracting a further foreign debt, I beg, at least, that the monies necessary be borrowed at home on yearly interest, payable in bills on Europe, or in hard money at home, and let the delinquent States be charged with this interest, for if there was no delinquency, there would be no need of a loan: my reasons are,

1. If interest of hard money or bills must be paid, I think it better that our own people should have it than strangers, that the yearly profits of the loan should lie among ourselves, and not go out of the country, never to return.

2. It is less dangerous to contract a foreign debt, sufficient for the yearly interest of this loan, than for the principal and interest too.

3. This method will have one absurdity less than the other, for if bills are to issue for the money to be loaned in Europe (for our necessities are so pressing, it is said we cannot wait till the advices arrive that the loan is completed) they must be drawn on funds of mere imagination, for not one shilling of the fund on which they are to be drawn, is yet procured, nor do we know that the loan can be obtained at all; and therefore every bill is liable to come back protested, to the utter ruin, and most laughable contempt of the credit of the States. And

4. The uncertainty of the payment of the bills will certainly operate on the sale of them. I believe nobody expects they can be sold at a loss of less than 20 or 30 per cent. The present exchange of the currency is 40 to 1; but I have not heard any body propose selling the bills at more than 30 for 1.

5. The very idea of drawing bills or loaning at a loss of 20, 30, or 40 per cent. appears to me so very ruinous and absurd, and the fact stands in so glaring and striking a light, that I do not know how to form one argument for the conviction of such as are willing to adopt either. The great, sure, and only supply of all our wants, and remedy of our distress, lies in taxes. Justice requires that this remedy should be effectually adopted: public burdens ought to rest in due proportion on all, which can be effected in no other way. This alone will create an universal demand for our currency, and bring it into such repute, that every necessary article in the country may be readily purchased with it; this settles and finishes the matter as we go, and relieves us at once from the anxious terrors of an unsupportable debt, and all future demands and insults from any power on earth.

Say, Americans, if this freedom and independence, for which you have bled and nobly dared every danger, and for which you have set at defiance, and incurred the vengeance of, the mightest power on earth, is not still worth your most capital attention: it avails little to change our masters; to have none is our object, which can never be our case, if we are in debt to foreign powers.

III. I beg leave here to propose one thing more, viz. to take off every restraint from our trade. Let every man be at liberty to get money as fast as he can; and let the public call for it as fast as the public exigence requires. Limitations of our trade have been so often tried, so strongly enforced, and have so constantly failed of the intended effect, and have, in every instance, produced so much injustice and oppression in our dealings, and excited so many quarrels, so much ill-will and chagrin among our people, that they have, in every instance, after some time of most pernicious continuance, been laid aside by a kind of general consent, and even most of their advocates have been convinced of their hurtful tendency, as well as utter impracticability.

As experiment is the surest proof of the natural effects of all speculations of this kind, and as this proof of fact has ever appeared in the strongest manner, against the practicability and success of all restraints of this sort, and as every seeming, temporary advantage that has resulted from them, has constantly been followed by effects so very pernicious and alarming, it is strange, it is marvellous to me, that any person of common discernment, who has been acquainted with all the above-mentioned trials and effects, should entertain any idea of the expediency of trying any such method again.

Not less absurd should I conceive a number of adepts in Barclay’s system of ideas, driving their heads ten times going against a wall, and still preparing to try it again with greater force than before, because they could not believe there was the substance of a wall, but an idea only there; equally in both cases must the career of the zealots be stopped in hard fact, and their skulls, if not exceeding thick, must be greatly wounded.

Liberty and property are the most tender interests of mankind; any kind of abridgment, restraint, or control of these is ever sensibly felt and borne with impatience; and the natural course of things seems so adapted to those two great and favorite rights, that any violations of them will, by their most natural operation, produce effects very unsalutary, if not fatal. Indeed, this mischief may at any time be increased till the effects are tragical. Trade, if let alone, will ever make its own way best, and, like an irresistible river, will ever run safest, do least mischief and most good, when suffered to run without obstruction in its own natural channel.

IV. I humbly propose further, that no private property may ever be taken for public use, against the consent of the owner, without the most manifest necessity, and in that case, not without paying the full value. If the public wants any man’s property, they are certainly better able to pay for it, than an individual is to lose it. Paying half or any thing less than the whole value, is a scurvy and evasive way of robbing the owner, and infinitely unworthy of the justice and dignity of a State. There has been so much of this iniquity committed either with or without pretext of Law, that it has been really dangerous for a man to possess an article of capital demand; he has been in danger of having the article torn from him, not only without due payment, but with insult and abuse; and this wicked and shameful practice has really discouraged many persons of great ability and industry, from procuring articles of great demand, lest they should be thereby subjected to the mortification of having them torn away with violence and disgrace.

Many great necessaries have been rendered scarce by these means, and thereby the price has become enormous, and the procurement difficult. Instances in flour, salt, &c. are most notorious and obvious. This greatly destroys the confidence of the holders of the great necessaries, in the officers of government, and lessens their assiduity and zeal in procuring or bringing their goods to the public stores. The consequences of this shameful iniquity are most fatal in their nature, and tho’ slow and not immediately perceptible, yet most certain in their operation, and most sure of effects.

V. I propose further that there be the greatest care and attention in the appointment of the men who are to fill all places of public trust, and especially such as are employed in the revenue and expenditures of the public monies and supplies. I should conceive the following qualifications so necessary as to admit of no dispensation:

1. That the candidate for any place of public trust have sufficient knowledge and ability to discharge the duties of the office proposed for him. A public officer, like St. Paul’s bishop, ought to be a workman that needs not to be ashamed. But I am sure any person needs to be ashamed, who appears in a public office without understanding the duties of it, and therefore utterly incapable of discharging them properly: and the persons who appointed him ought to be ashamed of him too, and he certainly will prove a shame to the public; for the public, i. e. a kingdom, a state, a country, or a city, always shine thro’ the medium of their public men; if they mean to have their weight, dignity, character, and interest well supported in a treaty, a Congress, a General Assembly, or a Court of Justice, they must appoint sufficient men to represent them and act for them; if they would have their most public and important counsels, their laws, the administration of public justice and civil policy, or their revenue well conducted, they must appoint men of knowledge ane abilities sufficient for these great purposes, to conduct them; these are all objects of such magnitude, such general importance, and pervade with such subtilty every interest of the community, that they reach and deeply affect every individual, and prescribe the degree of security, honor, and peace which he is to enjoy.

How mad and execrable then must be that elector, or person concerned in the appointment of a public officer, who, from motives of party, personal friendship, or any worse inducement, will give his vote for a person, who, he knows, is deficient in the knowledge and abilities requisite to the proper discharge of the office? Let a man’s virtue and integrity be never so great, if he wants knowledge and ability, he never can shine, he never can serve with honor or advantage in the office, but must be a shame to himself and to his constituents, and most probably a damage, and may be a ruin into the bargain. But

2. Knowledge and abilities, tho’ essential, are not the only requisites in a public man; integrity and prudence are also most necessary. The true character of the heart cannot be certainly known indeed, but is best judged of by his general deportment; therefore the character which a man obtains among his neighbours, and those who best know him, is the surest rule by which he can be estimated, and will be most likely to pre-engage the public confidence in his favor; and it is necessary, not only that a public man should be upright, but also that he should be generally esteemed so. The wife of Cæsar ought not to be suspected; therefore it must be the height of folly (to say no worse) to appoint a man to public station, whose private character for integrity and prudence is not good.

3. Sound judgment and rational discretion is a most essential part of necessary character in a public man, especially one who is concerned in the public councils, or important offices of any sort. Nothing can scarcely be conceived more dangerous to the public, than to have its great arrangements subject to the influence of a man of wild projection, and extravagant conceits; such a person, especially if he has a good address and copious invention, is enough to make errors faster than twenty men of the best wisdom can mend. It is not strange, to find men, who have great talents at discovering valuable mines, who, at the same time, have no knowledge in essaying the ore, or making the proper use of it. But to come more immediately to the point in view,

4. In the appointment of an officer of the revenue, or expenditures of the public monies, i. e. one through whose hands the public monies or supplies are to pass, it is necessary, most essentially necessary, that he should be a man of known industry, economy, and thriftiness in his own private affairs. If a man’s regard to his own character, fortune, and family, is not a sufficient inducement to make him careful, industrious, and thrifty in his own affairs, it is not to be presumed, that any regard he may have to the public can make him so; a man’s own interest always lies nearest his heart, i. e. self-love is the strongest of all passions and motives. It was hardly ever known, that raising a man into public office, mended his private vices, but they most commonly like a pervading poison, get incorporated into the department, in which he officiates, and greatly corrupt and injure the administration of it.

Therefore to appoint a bankrupt, a man of dissipation, idleness, and prodigality, to an office, through which the public monies and supplies are to pass, is a sure way to have them wasted or purloined, in which the riches, strength, and blood of the States are exhausted; not to answer the great ends of government, the safety, security, and peace of the great whole, but to gratify the extravagance, dissipation, and debauchery of an individual; it would be much better, if a man has such a friend, that must be served, to give him a few thousands, to spend in his own way, than to admit him into the important offices of revenue, and thereby corrupt its course and use.

Perhaps some errors of this sort may have occasioned a profusion of expense, a neglect and loss of public stores, and a failure of distribution, all which tend to increase our distress, and accelerate the decays of our finances; for as in private affairs, prudence in expense is as necessary to a fortune as the acquirement of money, so in our public administration, I conceive economy in expenditures, as necessary a part of financiering, as the acquirement of a revenue: and I conceive in this, as in all other parts of public administration, good government depends more on the men who administer, than on the system or form of the constitution, the wisdom of the laws, or prudence of the general orders; for let all these be ever so good, if the executive part is not committed to industrious, wife, and faithful men, there will be a great failure of justice, security, and peace.

VI. I propose a review of all our departments, and reducing all unnecessary expenditures in them, as far as possible. It is better to lessen the expenses, where it can be done with safety, than to increase the revenue; the one lessens, the other increases the public burden. I am told there are 9000 rations issued daily in this city, where there is not the least appearance of any military movements, except a few invalids, and sick in the hospital, and the prisoners, all which do not amount to one third of the aforesaid number of rations.

I am told there are posts of commissioners, quarter-masters, purchasers, &c. fixed at about 10 or 15 miles distance from each other thro’ this State, and some say thro’ the whole Thirteen States; if they were all sent out of the way, all the supplies within reach of our market, would come of course to this city, and might be all purchased here by one man, much cheaper, and at less expense, than by all those posts; spreading them about thro’ the country answers the same end, as if a private man should send a servant ten miles out of town to buy his marketing; he must solicit more, pay a higher price, and have a worse choice than if he stayed at home, and bought in market. But I cannot pretend to go into the minutiæ of these matters; I can only observe, that people out of doors cannot at all conceive the reason or use of these multiplied officers of so many different names, that one has need of a dictionary to understand them; I am apt to wish they were all struck off the list, by one dash of the pen, at least that their rations and clothing might be stopped, and sent to camp for the use of our soldiers in real service.

I would add to my wish also, that their horses might be taken away from them, that they might not be able to parade it thro’ the country on horseback, or in carriages, as they now do with a gaiety of dress, importance of air, and grandeur of equipage, very chagrining to the impoverished inhabitants who maintain them: I conceive this method would supply our camp very comfortably for several months, till our finances might be recruited by the numerous taxes which are coming in, and in this way the necessity of Loans might be prevented, or at least lessened.

If it should not be thought expedient to send their wines to camp, as I do not know that an abundance of liquors do soldiers or any body else any good, I propose to send them to vendue, as they have much engrossed that article of late, it is become very scarce and dear, and would probably bring a great price, and the proceeds of them might be a seasonable supply to the Continental Treasury, and further lessen the necessity of loaning.

In fine, my great object is to get our revenue fixed on a sure and sufficient foundation, and our expenditures reduced within the bounds of use, necessary to the safety and benefit of the community. In this case our people will all be willing to contribute the aids necessary; for the intentions of the people at large are ever upright, and it is rare that there is any difficulty with them in this respect, when they are convinced that the public monies are all prudently expended for necessary uses.

I further conceive that taxes are absolutely necessary, not only to supply the public treasury, but to reduce our money to a fixed standard, and restore it to its natural and necessary use, which no other method of supplying the treasury can do, and which yet must be done, in order to deliver us from the most dreadful calamity of a fluctuating currency. This I consider as of the most weighty importance, and at the same time of so critical, difficult, and intricate a nature, that it will require the utmost attention to the means of it, and the highest prudence and care to watch their operations, and add to or diminish their force as occasion may require.

For if the money should appreciate, it will, over and above all private wrong, increase the national debt. An appreciation of only 10 per cent. which may be done almost imperceptibly, will add 20,000,000 to that debt, which must be paid, not in shadows, but by the hard labor of our people. Such is the subtile nature and imperceptible operation of this mighty error, that no degree of attention to it can be deemed unnecessary. To mend this, I conceive to be the great work before us, hic labor, hoc opus est.

I am but little concerned or alarmed at the present pinch of the treasury. Our resources are too great to permit such a temporary, such a momentary distress to be fatal: a proper reduction of our expenditures, or a small anticipation of our revenue in any way, will remedy it. If the great springs of our revenue can be put in motion, we may be easily saved, otherwise we must perish.

I beg leave here to add, that the attention of Congress, however sufficient, if it were not unavoidably drawn off by an infinity of other objects that constantly crowd upon them, is not and cannot be practicable in a degree adequate to this great object. Nor indeed do I think that any board of numbers or aggregate body would be likely to form a system so exact, and bestow an attention so accurate and uniform as would be necessary in this case. I conceive it must be the work of one mind, which ever could investigate and superintend matters of an abstruse nature and critical movements better alone than with company; and therefore,

VII.* I propose, that a financier or comptroller of finances, be appointed, whose sole object and business should be to superintend the finances, i. e. the revenues and expenditures of the States, the state of the currency, and all the funds in which we are concerned, and in short, our whole resources and expenditures; and keep the one well in balance with the other, all under the authority of Congress, and in every thing subject to their control. The Congress would then have the subject examined and formed to their hand, and would have nothing more to do than correct and approve it.

If a man adequate to this business could be found, I conceive his appointment would be of the highest utility to the States, as we may easily conceive only by imagining the benefits which might have resulted from such an appointment, had such an one been made five years ago.

However, I do but propose this with the same simplicity of mind as I express my other thoughts; if it is not approved, it may be easily rejected, with any other of my propositions, and I have only to desire this one favor of my indulgent reader, that if he does not like this, or any other part of my Essays, that he would lay them by, and read them again a year or two hence, after which he has my leave to do what he pleases with them.

Time is the surest expositor and best judge of all plans and speculations of this sort; the vain and vicious will either vanish or stand condemned before him; the useful and good only can be approved and preserved by him: and while I make this appeal, every body will allow that I refer myself to a most equitable and reasonable arbiter, and I hope all my readers will candidly wait this decision with me, without censuring too bitterly sentiments on which time has not yet decided.

• —Quod optanti Divûm promittere nemo,
• Auderet, Volvenda Dies en attulit ultro.

• —Virgil.

[* ] It is to be observed here that it was not the practice of Congress under the old confederation, to institute taxes by any direct acts of their own, but they calculated the sums wanted, and made requisitions of them from the several States, in such proportions or quotas as were made pro re nata, as no established quotas, or rules of forming them, were settled. There was much conversation about this time and many debates in Congress, concerning the rule or principle on which the estimates of the quotas of each State should be fixed; and sundry modes of this estimation were adopted by Congress, with various alterations and amendments, till at last the long debated matter was settled by the new Constitution (article I.) on the principle here proposed, with a small variation respecting Negroes and Indians.

N. B. This matter was taken up again, and the principle or rule of estimation here proposed, discussed and proved more fully in a future Dissertation.

[* ] Taxes in kind are taxes to be paid, not in cash, but in necessaries for the army, such as flour, beef, rum, clothing, &c. &c. A scheme of this sort was brisk a-foot, among other wild projects, about this time.

[* ] A small loan had been negotiated a little before this time in France, and further loans in France, Spain, and Holland were proposed, and urged in and out of Congress with great earnestness and zeal. This seems to have been a period of distress and madness.

[* ] I believe this was the first proposal made in America, for the appointment of such an officer; I was so much convinced of the importance of such an appointment, that I repeated the proposal in several subsequent publications, and about a year after this, at the particular desire of some members of Congress, published an essay on the nature, authority, and uses of this office.