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Pelatiah Webster, Political Essays on the Nature and Operation of Money, Public Finances and Other Subjects [1791]

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Pelatiah Webster, Political Essays on the Nature and Operation of Money, Public Finances and Other Subjects, published during the American War, and continued up to the present Year, 1791 (Philadelphia: Joseph Crukshank, 1791).

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About this Title:

Written during the American Revolution these economic essays cover topics such as money, free trade, the rate of interest, the nature of the constitution, public debt, bank credit, and taxation.

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The text is in the public domain.

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This material is put online to further the educational goals of Liberty Fund, Inc. Unless otherwise stated in the Copyright Information section above, this material may be used freely for educational and academic purposes. It may not be used in any way for profit.

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Edition: current; Page: [a]
Published during the American War, and continued up to the present Year, 1791.
Edition: current; Page: [ii] Edition: current; Page: [iii]

PREFACE Of the Author.

THE first thirty years of my life were spent in the literary way, and generally employed in a course of hard study, and close attention to some subject or other; after which, by a turn in my private affairs, I went into a course of mercantile business, which was indeed more a matter of necessity than inclination. My old habits of reading and thinking could not easily be shaken off, and I was scarce ever without either a book or some subject of discussion ready prepared, to which I could resort, the moment I found myself at leisure from other business.

My usual method of discussing any subjects which I undertook to examine, was, as far as possible, to find out and define the original, natural principles of them, and to suffer my mind to be drawn on without bias or any incidental prejudice, to such conclusions as those original principles would naturally lead to and demonstrate, i. e. I endeavoured, as far as I could, to make myself my own original, and draw all my knowledge from the original and natural sources or first principles of it.

The powerful pressures of the British force during the war, and the obstinate and determined defence of the Americans, soon threw every thing into disorder, and produced every day new occurrences and new problems, which America had never seen before, and, of course, knew not how either to obviate or solve them.

The first operations of the war affected my connexions in trade so much, that it threw me out of my usual course of business, and left me at leisure to contemplate those occurrences; and I thought I might render an essential service to my country by examining them, reducing them to their original principles, explaining their nature, and pointing out their natural operation and probable effects.

I conceived that the most important and alarming of these events and questions were those which respected our resources, and especially the state of the Continental money, which was the sole supply of the public treasury at that Edition: current; Page: [iv] time. This induced me to turn my attention very seriously to the nature and operation of money and finance; a subject which I had never before examined, further than daily practice and private economy made necessary.

Some reasonings and conclusions on this subject were published under the signature of A Financier in 1776, and make the first of the following Essays; all the rest were published successively (as dated) under the signature of A Citizen of Philadelphia.

Whilst I reasoned on the great subjects of the natural operation of money and of national finances, and drew such theorems and conclusions as appeared to me to result from their natural, original principles, I had an opportunity to compare those conclusions with real fact, and to judge of their truth by experiment of their actual effects; and in this I was rarely mistaken. The effects or consequences which I inferred from the principles on which I reasoned, scarcely in one instance failed to follow in the kind, tho’ not always in the degree, which I expected, e. g. the strength of the States, and the patriotism, the patience, the firmness, and steady virtue of our people, were greater than I could expect, whilst I reasoned on human nature and human passions, as exhibited in the example of other nations, especially in the instance of unpaid armies. From these sprang resources for continuing the war, beyond my sanguine calculations, whilst national ruin appeared to me more near and certain than it really was.

Again, the obstinate perseverance of the British nation in continuing the American war was less than I computed on. I believe, the American independence was the only point which that nation ever yielded, after exerting every nerve of their strength to carry their purpose.

Further, I had no idea that the Continental money could be made to pass at all as a medium of trade at a depreciation even of 50 or 100, much less of 500, for 1.

It may be worth notice here, that these Essays exhibit not only a discussion of the principles and nature of money and national finances, but contain also a kind of history of these principles compared with facts or their real operation, during the convulsions of America thro’ a seven years’ war, when the dangers, the distresses, the firmness, the terrors, the wisdom, the folly, the expedients, the exertions, the resources, the strength and the weakness, the successes and the disappointments, which appeared under all modes and forms, put every principle into operation, and every conclusion Edition: current; Page: [v] and theorem to the test, and left no room for false reasonings or idle projections, because their fallacy was sure to be detected very soon by a failure or deficiency of their effects.

These Essays were all written at the times in which the several subjects of them were fresh, and strongly impressed on every American mind, and the feelings of every body were alive and wound up to the highest pitch of anxiety, and an asylum of even safety was eagerly sought. It may, therefore, be agreeable to my fellow-citizens to revise these distressing scenes, as people sometimes have pleasure in viewing places in which they have passed thro’ sorrows and calamities that are now over and past.

A review of arguments and reasonings on the abstruse subject of money and finance, cennected with fact, i. e. with the actual effects and consequences of them, may afford some gratification and amusement to speculative people, who are disposed to examine and explore those difficult, but very interesting matters, errors and mistakes in which have tript up the heels of, and brought by the board, very many statesmen in every nation.

For this reason it is probable that politicians and statesmen who may happen to be involved in these inquiries, may find benefit in an attention to American experience.

Such a connexion of principles, theorems, and facts, in the great subject of money and finance, is a phenomenon rarely to be found in any nation so clearly exhibited, as in the history of money and finances in our States during the war and its consequences.

In short, in the history of American distresses, perfect wisdom is not to be expected; but we have an opportunity of learning wisdom from it. Many projects, plans, schemes, and manœuvres, some of them hurtful, and others vain and ridiculous enough, were set on foot, and some of them pushed into execution with great severity, which either died soon without effect, or were marked with calamity during their continuance.

Many others more wise and judicious were also proposed, and sooner or later adopted with success and great benefit.

We have now an opportunity of distinguishing the wise from the foolish, the good from the bad, by their effects, which may help us much to wisdom in our future counsels.

We are now at leisure for consideration, and cannot plead pressures and distresses in excuse for any mistakes; and we have the effects of former errors, like beacons of caution set up before our eyes to guard us against repeating them.

Edition: current; Page: [vi]

Some Essays on different subjects are introduced here, which I leave, with all the rest, to make their way in the world, according to their merits.

In these Essays Continental money is often considered; to understand the arguments it may often be necessary to recur to the value of that money at the date of each Essay: I have, for this purpose, added at the end of this book four scales of depreciation, viz. the scale of Congress, that of the State of Pennsylvania, established by law, April 3, 1781, and two others, one for Philadelphia, the other for Virginia, taken from the merchants’ books.

The two first, for political reasons, vary from the true exchange part of the time; the other two, taken from the merchants’ books, are as near the true and actual exchange, as a thing of such a fluctuating and variable nature can be expected to be.

I have also added a chronology of remarkable events, as people generally connect the occurrences of these times with some or other of those events.

I cannot say I had all the success in these publications which I wished.

In some cases, they crossed the favorite plans proposed by influential men, which, like their children, they could not bear to see killed, or even corrected.

In some cases they opposed some great and strong interests, which bore them down.

In some cases, they stood opposed to general opinion in point of real propriety. The subjects were new, and the public mind had not time to fix itself on the ground of experience; many errors prevailed at that time.

In sine, most people at the time were wrought up to such a passionate attachment to the American cause, that they had not patience to examine and consider coolly the means necessary to support it.

But all men have now an opportunity to compare the various plans and projects of those times with the facts which followed, and doubtless will have pleasure in distinguishing the wise and prudent from the wild and idle, by their actual effects.

In this view, I here present my Essays all together to the reader’s perusal and censure.

Edition: current; Page: [vii]


  • AN Essay on the Danger of too much circulating Cash in a State, the ill Consequences thence arising, and the necessary Remedies, Page 1
  • An Essay on Free Trade and Finance, 9
  • A Second Essay on Free Trade and Finance, 27
  • A Third Essay on Free Trade and Finance, 50
  • A Fourth Essay on Free Trade and Finance, 74
  • A Fifth Essay on Free Trade and Finance, 97
  • Strictures on Tender-Acts, 128
  • An Essay or humble Attempt to examine and state the true Interest of Pennsylvania with Respect to the Paper Currency, 139
  • An Essay on the Economy, Policy, and Resources of the Thirteen States, and the Means of their Preservation, 152
  • A Dissertation on the Nature, Authority, and Uses of the Office of a Financier-General or Superintendant of the Finances, 162
  • Remarks on the Resolution of Council, of the 2d of May, 1781, for raising the Exchange to 175 Continental Dollars for 1 hard, 172
  • Strictures on a Publication in the Freeman’s Journal of May 16, 1781, signed Timoleon, 181
  • Strictures on two Publications in the Freeman’s Journal of May 30, 1781, signed, Phocion, and Impartial, 191
  • A Dissertation on the Political Union and Constitution of the Thirteen United States of North-America, which is necessary to their Preservation and Happiness, 198
  • 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, 230
  • 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, 269
  • A Plea for the Poor Soldiers; or, an Essay to demonstrate that the Soldiers and other Public Creditors, Edition: current; Page: [viii]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, 306
  • 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, 344
  • 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, 376
  • Remarks on the Address of Sixteen Members of the Assembly of Pennsylvania to their Constituents, dated Sept. 29, 1787; with some Strictures on their Objections to the Constitution recommended by the lare Federal Convention, 403
  • The Weaknesses of Brutus exposed: or, some Remarks In Vindication of the Constitution proposed by the late Federal Convention, against the Objections and gloomy Fears of that Writer, 413
  • 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, 427
  • Strictures on the Net Produce of the Taxes of Great-Britain in the Year 1784, as published by Order of their House of Commons, 464
  • An Essay on Test-Acts imposed with Penalties, 471
  • 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, 485
  • Scales of Depreciation of Continental Money, 501
  • A Chronological Table of Remarkable Events, 503
Edition: current; Page: [[1]]

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.]

THE computations of the value of the Free States of America by Conti—and Doria, in the Evening Post of Sept. 21, rather prove that value to be immense than reduce it to a certainty. Perhaps another method of computation might be admitted, viz. from the quantity of land within the present inhabited part of those states, which is at least two hundred millions of acres, and worth a dollar per acre I should think at least, some say two or three dollars, and perhaps the personal estate may be computed at as much more, which I do not think is reckoning high, and will make the amount four hundred millions of dollars. All these computations prove with certainty enough that the funds, on which the Continental money depends, are sufficiently great to support a very much larger quantity than is already emitted.(a) I would farther observe that the American States owe nothing to any body but themselves, and employ no ships, soldiers, &c. but their own, so that they contract no foreign debt; and I take it Edition: current; Page: [[2]] to be a clear maxim, that no state can be ruined, bankrupted, or indeed much endangered, by any debt due to itself only; nor can it ever be much impoverished by any war, if the war and other casualties do not destroy mankind faster than the women produce them, and the people that are left at home can furnish the provisions, clothing, &c. necessary for themselves and the soldiery, together with all other necessary stores and implements of the war.

There requires no more to preserve such a state in a war of any length of time than good economy in bringing the burden equally on all, in proportion to their abilities; but then I think it very necessary that they should pay as they go, as near as may be. The soldier renders his personal services down on the spot, the farmer his provisions, the tradesman his fabrics, and why should not the monied man pay his money down too? Why should the soldier, tradesman, farmer, &c. be paid in promises, which are not so good as money, if the fulfilment is at a distance?

Payment in promises or bills of credit is a temporary expedient, and will always be dangerous, where the quantity increases too much, at least it will always have the consequences of a medium increased beyond the necessities of trade; and whenever that happens, a speedy remedy is necessary, or the ill effects will soon be alarming, and, if long neglected, will not be easily remedied. The remedy or rather prevention of this evil I take to be very easy at present.

If the quantity of Continental currency is greater than is necessary for a medium of trade, it will appear by a number of very perceptible effects, each of which point out and facilitate the remedy. One effect will be, that people will choose to have their estates vested in any goods of intrinsic value rather than in money, and of course there will be a quick demand for every kind of goods, and consequently a high price for them; another effect will be discouragement of industry, for people will not work hard to procure goods for sale, while the medium for which they must sell them is supposed to be worse than the goods; and of course, another effect will be a discouragement of trade, for nobody Edition: current; Page: [[3]] will import goods, and sell them, when imported, for a medium that is worse than the goods themselves; for in that case, though the profits may be nominal, the loss will be real.

These effects all point out their only remedy, viz. lessening the quantity of the circulating medium, and this can be done by but three ways that I know of: First, the destruction of it by some casualty, as fire, shipwreck, &c. or secondly, exportation of it, which cannot happen in our case, because our medium has no currency abroad, and I think it very well for us that it has not; for in that case our debt would soon become due to people without ourselves, and of course less sensible, more difficult to be paid, and more dangerous; the third, and, in my opinion, the only practicable way of lessening the quantity is by a tax, which never can be paid so easy as when money is more plenty than goods, and of course, the very cause which makes a tax necessary, facilitates the payment of it.

The tax ought to be equal to the excess of the currency, so as to lessen the currency down to that quantity which is necessary for a medium of trade, and this, in my opinion, ought to be done by every state, whether money is immediately wanted in the public treasury or not, for it is better for any state to have their excess of money, tho’ it were all gold and silver, hoarded in a public treasury or bank, than circulated among the people, for nothing can have worse effects on any state than an excess of money. The poverty of the states of Holland, where nobody can have money who does not first earn it, has produced industry, frugality, economy, good habits of body and mind, and durable and well-established riches, whilst the excess of money has produced the contrary in Spain, i. e. has ruined their industry and economy, and filled them with pride and poverty.

But there is, besides this general principle, a special reason in our case, why we should pay a large part of our Continental debt by a present tax; the great consumption of our armies, and stoppage of our imports, make a great demand for the produce of our lands, the fabrics of our Edition: current; Page: [[4]] tradesmen, and the labor of our people, and of course raises the prices of all these much higher than usual, so that the husbandman, tradesman, and laborer get money much faster and easier than they used to do, and it is a plain maxim, that people should always pay their debts when they have a good run of business, and have money plenty; many a man has been distressed for a debt when business and money were scarce, which he had neglected to pay when he could have done it with great case to himself, had he attended to it in its proper season; this applies to a community or state as well as to a private person.

These last observations will apply with great exactness to those parts of the Continent which sie nearest to the great scenes of the war, and have suffered most by it; and if they can bear the tax, I think those who lie at a distance from those horrors, and have felt little more than a sympathy of the distress of their brethren, can have no reason to complain, if they are called on for their share of the expense.

The Continental money is to be considered as a debt fastened on the person and estate of every member of the United States, a debt of great honor and justice, of national honor and justice, not barely empty honor, but that essential honor and credit in which the safety of the state is comprised, and therefore by confession of every body must be punctually and honorably paid in due time; otherwise all security arising from public credit must be lost, all confidence of individuals in our public councils must be destroyed, and great injustice must be done to every possessor of our public currency, to the detriment of all, and ruin of many who have placed most confidence in our public administration: and nothing but shame, scandal, and contempt can ensue, for which nothing but most inevitable necessity can be any reasonable excuse.(b)

And in this great argument is every individual of our United States so deeply interested, that I cannot conceive Edition: current; Page: [[5]] one sensible person can be persuaded to risk these consequences for the sake of a little delay of payment of that which must one day be paid, or we must all be ruined together. The Continental debt is already a heavy one, and there is no way of sinking it but by paying it while we can; it is still increasing fast; and without a speedy tax, and a very sufficient one, it will grow upon us beyond any possibility of payment. If a man only suffers his rents, butcher’s and tradesinan’s bills, &c. to be unpaid a number of years, it will endanger his whole fortune. An expense account ought always to be paid up as soon as it becomes due; these are accumulating sums, and it is dangerous to neglect them.

I have heard some people say, it is no matter for the present payment of the Continental debt, we are a country of rapid increase, and what is contracted by three millions of people, will soon be paid by six. But how unfatherly and ungenerous is it to load posterity with an immense debt, which we have an advantage in sinking a good part of ourselves; besides, it will be a great discouragement to foreign emigrants to settle in this country, to be told that the country is loaded with an immense debt, and their first title to an enfranchisement will be by beginning to pay it.

We are engaged in a cause which, in all annals of time, has ever been deemed most honorable and glorious, and most characteristic of noble and generous minds, viz. spurning off slavery, and asserting our liberty. As things now stand, the most hardened, impudent Tory does not pretend that if we fail of supporting our cause, we have any other chance but that of absolute submission and pardon, and even hat pardon, doubtless, with numerous exceptions. Good GOD! Who can bear the thought of absolute submission and pardon? Pardon! for the greatest virtue of a civil nature that the human mind is capable of! Who can think, without distraction, of coming under the domination of tories, and suing to them for favors and intercessions? Tories! with standing armies at their heels, and soldiers with bayonets ready to enforce all the respect and submission they may claim.

Edition: current; Page: [[6]]

This dreadful apprehension introduces, with great force on my mind, another reason why we ought to sink, by a sufficient tax, as much as we can of the continental debt, viz. That without this it is not possible to continue the war, and avoid absolute submission.

I conceive the value of the currency of any state has a limit, a ne plus ultra, beyond which it cannot go, and if the nominal sum is extended beyond that limit, the value will not follow. No human wisdom, or authority, can be able to stretch the nominal currency beyond such real value. The consequence of any attempt to extend such nominal addition, must depreciate the value of the whole, till it is reduced within said limit.

I will explain my meaning thus:(c) Suppose that thirty millions of dollars was the utmost limit of currency to which the United States of America could give real, effectual value, and they should emit thirty millions more; I say the last thirty millions would add nothing to the value of the whole, but would sink the value of the whole sixty millions down to its limit, viz. thirty millions; i. e. the whole sixty millions in that case would not purchase more real, substantial goods, than the thirty millions would have done, before the other thirty millions were added to it.

It follows from this, that any attempt to continue the war, by increasing the currency beyond the abovesaid limit, is vain, and must fail of the effect intended, and ruin all those who possess the currency already emitted. Whether the currency already emitted rises to the said limit, is a question of fact that may admit some doubt, but that it is not greatly within it, I think can be no doubt with people well acquainted with the nature and circumstances of this great subject; and be that as it may, I think every inconvenience arising from it is easily remedied by a sufficient tax. I do not apprehend we have yet suffered by a depreciation Edition: current; Page: [[7]] of the currency, because I cannot observe that the general prices of goods are more raised than the circumstances of the war would make necessary, were our money all gold and silver, and farther extremities may produce farther effects of the same kind, without depreciating the currency at all.

No kind of necessaries have risen to the excess of price given last winter in Boston for fresh provisions, tho’ their currency was all gold and silver, increase of risk must raise the price of all imported goods, scarcity of laborers must raise the price of labor, and of consequence the price of every thing produced by labor, scarcity of tradesmen (many of whom are gone into the war) and demand for tradesmen’s fabrics, must raise the price of them; besides, many raw materials used by the tradesmen, must be imported at great risk, and I do not see that the prices of most or all these are greater than they would be, if every Continental dollar was a silver one.

But should we admit that we are on the verge of a depreciation, or that our currency hath suffered some little already in its value, two consequences will follow, which deserve great and immediate consideration.

First, That a speedy remedy is immediately necessary, which shall operate effectually, and prevent the ruin of our currency; and the second is, that the remedy by this very means becomes more easy and practicable than otherwise it could be, because a tax will be paid much more easily in this case than it could be, if money was in credit enough to be avariciously hoarded, and this holds, let the tax be of any nature, such as general assessment of polls and estates, excises, imposts, or duties on goods, lotteries, &c. &c. in any or all these ways, our currency may be lessened much easier, when its credit is a little doubted, than when it is at its highest.(d)

Edition: current; Page: [[8]]

What contributes not a little to this facility is, that it may be done by general consent, without public uneasiness and disturbance, for a depreciation of currency can be wished for by nobody, but those who are deeply in debt, the weight or numbers of whom I have reason to believe is not great at present in these States; it is the mighty interest of all the rest of the inhabitants to prevent a depreciation, and I conceive every man of estate who has cash in hand, or due to him, would be willing to contribute his share to the lessening our currency, and so preserving its credit. Yea, would eagerly choose this, rather than risk his own loss by a depreciation of the cash he has in hand, and in debts due.

In this time of distress the public has a right to every man’s best thoughts. I have not the vanity to think I can exhaust the subject, but I have said so much on it, as I hope will set abler heads and pens on a thorough disquisition of it, for I think all will agree, that the subject is a very important one, and deserves most immediate and most serious attention.

Edition: current; Page: [[9]]

AN ESSAY ON Free Trade and Finance.
First published in Philadelphia, July 1779, and dedicated to CONGRESS.

FREEDOM of trade, or unrestrained liberty of the subject to hold or dispose of his property as he pleases, is absolutely necessary to the prosperity of every community, and to the happiness of all individuals who compose it: this liberty will produce the following effects:

1. Every industrious man will procure all the goods he can for sale; this is the way to get most money; and gain is the soul of industry, the hope of reward sweetens labor, and the most righteous have respect to the recompence of reward.

2. Every man will make his goods for market of the best quality he can, because they will bring more money and quicker sale than goods of mean quality.

3. Every man will endeavour to carry to market the most scarce goods because there is the greatest demand and best price for them. All experience shews, that the most effectual way to turn a scarcity into a plenty, is to raise the price of the articles wanted: witness, among other instances, the most alarming scarcity of saltpetre and gunpowder, in the beginning of the present war, succeeded by the most abundant plenty in less than one year, effected altogether by the high price and premiums set on them.

Edition: current; Page: [[10]]

4. Every man will go to market and return in good humor and full satisfaction, even though he may be disappointed of the high price he expected, because he has had the full chance of the market, and can blame nobody; and should he indulge fretting on the occasion, he would be the more ridiculed, and less pitied by his neighbours: and good humor and satisfaction contribute not a little to the happiness and prosperity of communities, as well as individuals; and therefore this is an article by no means to be left out or overlooked in the administration of either public or private œconomy.

5. In times of danger, distress, and difficulty, every man will use strong endeavours to get his goods to market, in proportion to the necessity and great demand for them; because they will then bring the best price, and every man is fond of embracing golden opportunities and favorable chances.

6. When things grow scarce and dear, every man will use them with the best œconomy, and make the stock on hand go as far and last as long as possible; or if he is destitute, will buy as little as will just serve his necessity. This naturally preserves the stock on hand from needless profusion and waste, and converts it to the best and most prudent use for the benefit of the community, and naturally tends to ward off high distress or total want, till the high price and great demand, by their natural operation, will bring further supplies to market.

7. In times of scarcity, every man will have strong inducements to bring all he can spare to market, because it will then bring the highest price he can ever expect, and consequently the community will have the benefit of all that exists among them, in a much surer manner than any degree of force could extort it, and all to the entire satisfaction of buyer and seller; by which the numberless feuds, riots, resentments, and mischiefs which usually attend forced markets, would be entirely avoided; and the market be supplied with all there is to be had. For no principle can draw into market, all the supplies which are attainable, Edition: current; Page: [[11]] so effectually, as the cheerful good-will and interest of the owners.

8. In times of scarcity, when all the goods that are to be had, are exposed to sale, it is not possible the prices should exceed the degree of scarcity, for when the prices rise very high, they will soon determine whether the scarcity is real or not; for if not real the high price will bring such quantity to market as will soon lower the price; but if real, it is necessary for the above reasons, that the prices should continue high till supplies are produced.

Restraint of property or* limitation of prices will hurt any community, and will probably produce the following effects, contrary to the above.

1. Every man will have as little to do with the market, and bring as few goods there as he can; for the less goods he has for sale, the less mortification and loss he sustains.

2. Every man will make his goods for market of a bad quality, or at least not the best; for they must all go at the limited price, and he therefore gets nothing for any special care or skill he may bestow on his goods to meliorate or perfect their quality: for the same reason, every man will expose his worst goods to market, and keep the best out of sight; for example, musty tea, stale flour, black heavy bread, &c.

3. Every man is induced to keep such goods as are most scarce from market; for if he carries them there, he can get no more than the limited price, and stands a chance of a bad hustling in the crowd into the bargain. Whereas, if he can keep his goods from market, the scarcity will soon force a great price, and he has a chance of great profits.

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4. If prices are limited, and the owner is compelled to sell at the prices limited, he considers himself injured by every sale he makes for less than he supposes he could have obtained in a free market; that his liberty is taken from him, and he can no longer call his property his own. These are hard feelings to one born to freedom almost perfect, and raised to the expectations of enjoying it in future time, in its highest perfection. These feelings fill the mind with anxiety and resentment, and when instances of this become numerous among the merchants, tradesmen, and farmers, small accidents may blow up the concealed coal, and most fatal effects may easily be supposed to ensue. This is a danger of no small magnitude, for the real strength and establishment of every government consists in the hearty union and satisfaction of the individuals that compose it.

5. In times of danger, distress, and difficulty, no man will be induced to any great efforts to supply the market; for an additional danger makes an additional expense upon the goods; but he must take the limited price and no more; he will not consequently combat or risk an increase of danger and expense without any chance of compensation.

6. When things grow scarce, every man will endeavour to lay in great stores if he can do it without an increase of price, and will not think it necessary to retrench his expenses, whilst he thinks his stock will last through the scarcity; the consequence of which is, that all the scarce articles at market will be scrambled up by a few hands, who will have no inducement to parsimony in the expenditure of them, by which the scarcity and distress are increased, and many must be wholly destitute; and as far as this respects the necessaries of life, the consequences must be dreadful.

7. Add to the above, that in times of scarcity and great demand, every man who can possibly conceal his goods will be tempted to do it, in expectation that the great demand will soon break through the unnatural restraint of the limitation, and he shall be able to obtain a great profit in the future sale; and in spite of all the vigilance and force that can be used, many will be able to do this; which I Edition: current; Page: [[13]] take to be one of the natural effects of any unnatural restraint of trade, which cannot be avoided.

8. In addition to all these, the difficulties which must attend the execution of such an act of limitation, may perhaps furnish not the least objection to it. Must the owner be obliged to sell to every person who applies to purchase, without knowing whether he wants for use or sale? Must he forego previous engagements of his goods in favor of the present demandant? Must he be obliged to sell to every knave and litigious fellow, with whom he would not chuse to be at all concerned in any dealing? Who shall judge how much he may reserve for his own use, and whether he may give corn to his cattle and hogs, and how much, and how many of each he may keep, &c. &c. &c. Must he have his house searched from top to bottom for concealments? Even the lodging-rooms of his wife and daughters! I must beg to be excused from any further description of these horrors, which too many know are not mere creatures of the imagination.

9. It is not possible to form a limitation of prices which shall be just, and therefore the whole scheme necessarily implies injustice. The principles on which the just prices of goods are fixed, are in a constant state of fluctuation, and therefore the prices must rise and fall with their causes: all experience proves this, and it holds true in the most excessive degree, in times of such public distress and convulsion as we now experience. And as it is much safer to bind a man in health than a man in convulsions, so it will be safer to limit trade in peaceable than convulsed times. It is not more absurd to limit the precise height to which a ship shall be fixed at a wharf, where the tide is constantly ebbing and flowing. A great force will be requisite to keep the ship from rising or falling with the tide, and a mighty little use to pay for the trouble; besides the probability of very essential damage which the ship must incur by the application of the necessary force: but indiscreet as this would be judged, it is less dangerous in a calm than in a stormy season.

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10. Another mischievous consequence of this fatal measure, and not the least, I conceive to be its unhappy tendency to corrupt the morals and integrity of the people. To escape the ruinous consequences of loosing in their sales, they are in a manner compelled, but to say the least, they have very strong temptation, either by downright lying, or using little arts, shifts, and cheats, to avoid the sale of their goods to disadvantage. This naturally brings them into the habit, and gives them a facility of inventing and practising low methods of shamming Abraham, which they never would otherwise have thought of, and which it is infinitely detrimental to the public, they ever should learn; instances of this sort might be enumerated without end. But it is needless to give examples, it were better they and their causes should be removed, than that they should be repeated. But after all, it is said that a limitation of prices is necessary to appreciate the currency, and supply the army. Two very great objects indeed: I will attend to both.

I. I do not conceive that a limitation of prices can possibly appreciate the currency or prevent a further depreciation.

1. The value of money is nothing in itself, it is a mere relation, it is the proportion between the medium of trade and the objects of trade; these two will always be in balance: Therefore, if the medium of trade be increased, whilst the objects of trade continue the same, the money must depreciate; if the medium of trade increases, and the objects of trade decrease, the proportion will alter fast, and the depreciation will increase in a double proportion, which I take to be the case at present. Money will therefore increase or decrease its value according to the increase or decrease of its quantity, and the increase or decrease of the quantity of goods, or the objects of trade. This principle is grounded on the nature of the thing, and can never be altered, and consequently any attempt to oppose it must be equally vain, as opposing any other law of nature whatever. It follows from this, that nothing can ever appreciate the money, but lessening its quantity, or increasing the quantity of goods or objects of trade, and all attempts to Edition: current; Page: [[15]] do this in any other method, will prove vain and fruitless in the end.

2. It follows, that the price that any article of trade will bring in a free, open market, is the only measure of the value of that article at that time, and if this is warped from the truth, by any artifices of the merchant, or force of power, it cannot hold; but the error will soon discover itself, and the correction of it will be compelled by the irresistible force of natural principles, i. e. it is not possible for merchants to raise goods too high, or the force of power to depress them too low, and make them keep so. Both these may be done for a short time, but neither can last long.

3. It follows that any limitation of prices, however strongly enforced, if below the rates required by this great natural proportion, is but temporary injustice, cannot be of long continuance, will tend daily to lessen the quantity of goods in market, and so will increase the mischief it was designed to prevent, and bring with it a large train of evils besides, which will require much time and wisdom to remedy, and many that will be utterly remediless, examples of which are obvious.

4. Money is made only for a medium of trade, and must be kept in circulation and use, or it perishes; for to stop the circulation of money and to kill it is the same thing, stop its course and it dies, give it circulation again and it revives, or comes to life again; therefore, the price of goods for sale, or objects of trade (i. e. every thing for which money is paid) must always be so high, as to require all the money there is to purchase them, otherwise the sum remaining cannot circulate, i. e. there will be nothing to lay it out upon, and so the owner must keep it by him, dead and useless: so that let what sums of money soever be in circulation, the objects of trade must either increase in quantity, or rise in price so high as to take all the money there is in circulation to purchase them, and as this natural law cannot be restrained, so neither can it be exceeded by any degree of artifice or force for any long time, for if the objects of trade rise so high that all the money in circulation Edition: current; Page: [[16]] will not purchase them, the overplus must remain dead and unsaleable in the hands of the owner, which will soon reduce the price; for goods which cannot be sold, are as useless in the hands of the merchant, as money which cannot be circulated.

5. Every limitation of prices below their due proportion, cheeks the circulation of money, than which nothing can be more dangerous, when money is over plenty; this has been the constant effect of every limitation of prices which has been tried in America. Business immediately stagnates, goods cannot be had, people cannot purchase with their money the necessaries they want, they begin of course to think that their money is good for nothing, and refuse to take any more of it, and grow willing to part with what they have on hand at a depreciated value; so that the certain operation of a limitation of prices is a further depreciation of the money instead of the contrary. Instead of this, it is of the last necessity in a plenty of money, that a free circulation be kept up, people will readily and even greedily take any money which they can readily pass again. And as long as this lasts, there can be no danger of the money’s stopping; whereas, the contrary chills it at once, and in a short time must chill it into a torpor, incapable of cure. Much in this case depends on opinion, which is soon formed by people in general, when they find they cannot buy necessaries with their money. Specious reasonings, warm harrangues, declarations of Congress, or even the force of power operate little against this; it is a glaring intuitive proof of the badness of money, when it will not purchase necessaries, and as glaring and strong a proof that it is good, when it will buy any thing in market. Hence appears the necessity of keeping up a high and brisk circulation of money, and the folly and danger of limitations, or any other measures which prevent a circulation and obstruct trade. These are arguments grounded on plain fact, they have their foundation in the laws of nature, and no artifice or force of man can prevent, elude, or avoid their effects; their operation is uncontrolable, and therefore I conceive all opposition to them is the height of Edition: current; Page: [[17]] absurdity, and dangerous in the highest degree.—For ten months before the late limitations, we had a trade perfectly free, on which two observations are obvious.

1. That any goods at market might be bought for continental money, the Speculators especially (as they are called) were fond of receiving it, and no person could be at any loss for any thing at market, if he had that money to purchase the goods he needed.

2. That imported goods on an average (which were the only articles Speculators dealt in) were 50 per cent. cheaper on the 25th of May last, than on the 25th of July preceding, i. e. any given quantity of imported goods would buy 50 per cent. more articles of country produce, or hard money, on the 25th of July, than on the 25th of May last; and for the truth of this, I refer to the merchants’ books; from which it follows that the Speculators (however numerous and however censured) have not raised the price of the goods they have principally dealt it:—Indeed all experience teaches, that the more hands the goods in market are held by, the cheaper they will be, and the more difficult to raise the price; and therefore, if the merchants ever think of raising the price of any article, they never fail to say, We must wait till these goods are drained out of the small stores and get them into few hands. In July 25, 1778, price current of imported goods, at Philadelphia, was as follows, West-India rum 3l. 15s. Muscovado sugars 30l. molasses 40s. pepper 17s. 6d. coffee 9s. cotton 15s. bohea tea 60s. Madeira wine 400l. dry goods about 8 to 1 old prices, and hard money 4 to 1, and price current of country produce, was as follows, for Indian corn 15s. oats 12s. flour 60s. bar iron 200l. consequently on July 25, 1778, one gallon of West-India rum would bring 5 bushels of Indian corn, 6 bushels of oats, 1¼ hundred of flour, and 2/5 of a hundred of iron, or 18s. 9d. hard money; any body may easily compare the rest, and they will find enough to prove my assertion with large allowance. Price current 25th May last was, rum 7l. sugars 130l. iron 800l. tea 6l. 10s. &c. Indian corn 7l. 10s. oats 90s. flour 30l. (hard money 20 to 1) and consequently one gallon of rum would buy no Edition: current; Page: [[18]] more than one bushel of Indian corn, 1½ bushel of oats, ¼ hundred flour, and 2/5 hundred iron or 7s. hard money, &c. These computations are made in the face of the world, and grounded on facts which any body may disprove if they are not true, or correct the reasoning if it is not just. Now I have only to add; let any body who is disposed to see, open their eyes, and see who it is that has raised our prices, or which is the same thing, depreciated our money. Is it the Speculators who deal only in imported articles? Or the farmers, among whom no kind of dangerous speculation does or can exist? Perhaps it may be replied here, that the articles of country produce are extremely scarce, which raises their price beyond the due proportion of other things: if you say this, you say every thing and yield every thing, viz. that the plenty and scarcity of goods will govern the price. You must admit too, that the plenty and scarcity of money will determine the value of that also. Why then will any one pretend to limit either, against the operation of this great principle? It is easy, in addition to all this, to prove that the price of imported articles in general does not exceed the value of them, if computed on the expense of acquirement: but this I mean only to hint, and wave it for the present; and only wish some merchants of experience and reputation would take it up, and publish the needful essay on it.

Nor do I think that the scheme of loans can give establishment to the currency, or prevent its depreciation.—For

1. All loans increase the public debt, and the immensity of the sum is one cause of the depreciation, as it induces people to think it never will be paid, or the payment will necessarily be delayed to such a distant period, as in point of use to the present possessor is nearly equal to total failure.

2. If the credit of the Loan-Office is well supported (as it must be to give it any good effect) the Loan-Office certificates themselves will pass in payment, and so become an addition to the currency which they are designed to lessen.

3. If foreign loans are negotiated, and bills sold here, drawn on the loaned bank in Europe, those very bills will become a currency here, and so add to the mischief.

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4. The discount on all European bills, is not less than 50 per cent. which loss must immediately be sustained by the Continent on the first sale of them.

5. If hard money, borrowed in Europe, should be imported and sold here, the insurance, which is more than 50 per cent. must be lost, nor can any man tell the mischief which would attend any attempt to import hard money, and open offices for the sale of it for continental bills: but a large group of these present themselves too plainly to need enumeration.

6. Nor do I think the* scheme adopted by our Committee promises better success; for that proposes Loaning without inducement; and if it should succeed to the utmost expectation, it would drain the best friends to our cause of their money, whilst our internal enemies would pay nothing, for no compulsion is proposed, and after all, it will be at best but an anticipation of the revenue, very dangerous in the end; for the very worst thing that can be done respecting a revenue, is to destroy it all, principal and use, and the next worst thing is to anticipate it, i. e. to spend this year the rent and proceeds which will become due and payable next year, and these two are so connected, that the latter generally brings on the former sooner or later.

After all these objections to the various methods that have been proposed, it may be expected that I should propose some method that will be practicable and effectual to fix the value of our currency; and this I cannot think very difficult, either in theory or practice, though I have not one new thought to offer the public on the subject. We are now on the brink of ruin, and the worst disgrace, in danger of loss of liberty hitherto nobly asserted, and subjection to shameful slavery to enemies most cruel and insulting in themselves, and all that heightened in them to madness by the determined opposition we have given to their scheme of tyranny over us. All this danger arises not from our poverty or want, for we have officers and soldiers enough, stores Edition: current; Page: [[20]] of every kind enough, and zeal, union, and virtue sufficient to insure success; our difficulties arise only from our having too much money, and the lessening that quantity would relieve us at once from every difficulty, and dissipate the thickest clouds that hang over us.

In matters of difficulty and importance, all wise counsellors compare well the end and the means, on which two very weighty matters always present themselves.

1. Whether the means are sufficient to secure and effect the end proposed.—And

2. Whether the end is worth the means necessary to effect it. When these two points are settled, there remains no more room for consultation or debate, the rest is all vigorous action, strenuous exertion to put the means into such effectual execution as to obtain the end. This is a wise method of planning, which no man will have any objection to. We will then adopt it in the consideration of the weighty subject now in view.

1. The end is fixing our currency and preventing any future depreciation, and so putting an effectual end to all the cheats, delusions, disappointments, and ruinous losses, which every one who has been concerned in it hath hitherto felt, and giving every one a sure and well grounded confidence in it in future. This is an end, an object of such vast, such weighty consequence, and so confessed and acknowledged by all, that no arguments or illustrations are necessary to be added here.

2. The only means I conceive possible to obtain this end, are to call in such sums annually by taxes, as shall be equal to the annual expenditures; this will prevent the increase of the money, will make a great demand for it through the Thirteen United States, will give it a brisk circulation, will exhibit a most convincing proof that it may be all called in and redeemed, and that it is the real design of Congress to do this. * Nothing helps the credit of a large debtor Edition: current; Page: [[21]] like making ample provision for actual payments; he may promise till he is grey without this, and all in vain; the larger his promises, the less are they credited, and the more ridiculous does he become: the cry against him is, Where is the money to come from? let us see a sample of it: but the cry is altered when large payments are actually made, and sufficient provision making for the discharge of the whole debt. Let people see the money collecting through the Continent, and the sources of revenue actually opened, and the whole matter in train, there can remain no doubt but the whole of the Continental money will be redeemed, and every one will venture to trust the credit of it; and in this confidence it will be soon sought after and grasped with greediness, and hugged and hoarded with avidity.

This will put life into all our public measures, civil and military, will give our government the command of the fullest supplies of men, money, and stores that are in the country, and that can be made or procured, will give spirit to our people, will animate industry, and will be a total cure of the mischiefs we now feel from the low credit of our currency. Here is an object highly worthy of our attention, as every one will admit without hesitation: the only thing then that remains, is whether it be practicable: I soppose the outcry against it will be, that the people will not bear such enormous taxes, that they would sink the poor and distress the rich far beyond what they will ever consent to bear, &c. &c. I conceive a vein of conversation of this sort not at all founded in truth, for several reasons.

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1. It is rare that the people refuse burdens or even grumble under them, when, by general conviction, they are necessary for the public good. And I dare say, that the absolute necessity of fixing and establishing our currency is become obvious to almost every individual on this Continent, and the real necessity of taxes for this purpose clearly seen by all.

2. As far as my acquaintance with people of middling rank extends, they have been generally in favor of taxing for three years past; they say this money must be paid first or last, and we can better pay it now whilst we have little use for our money, whilst it is plenty and easy to be got, than in future time, when we can perhaps not so well spare it, and when the getting it will be much more difficult.

3. The enormity of the sum required for this purpose consists much more in sound than substance; a quarterly tax of one bushel of wheat, or two bushels of Indian corn per head, on all persons in the Thirteen States, would be amply sufficient. The number of souls are computed at 3,000,000, in all the States, and of course this would produce 12,000,000 bushels of wheat, which at 20 dollars per bushel (the lowest present price) will be 240,000,000 millions of dollars, a sum greatly exceeding any annual exigence of these States; each State might apportion this as they pleased, so as to relieve the poor, and increase the share of the rich, but the middling farmer, who has ten in family, would have 40 bushels of wheat or its value, to pay in a year.

I admit this would be a high tax; but is there any thing impossible or ruinous in this. In the best of times, it would have been 40 dollars or 15l. and the same sum of hard money will probably now pay it, it is to be observed this is not the tax of a poor man or a new beginner, but of a middling farmer, with ten in family; such are spread over the face of this fertile country, and few of them so poor, that such a sum would distress them to any great degree.—It is to be observed further this is not a tax to last always, but to be paid only for a short time, during our Edition: current; Page: [[23]] strong exertions for the liberty of ourselves and our posterity;—again, this sum is not all to be paid at once, but at four quarterly payments;—again this is not a tax which demands wheat in kind, hard money, or any thing else that is scarce and hard to be obtained, but for Continental money, which is so plenty as to become the great burden of the country, and the source of most of our public calamities, and which any valuable commodity will procure in plenty, and with little trouble; and for which any man may sell any thing he can best spare without difficulty;—again, this is a sure method to overcome our capital difficulties, and fix the currency, whereas all others are precarious and uncertain in their effect. This is a durable, a finished remedy; all others that have been proposed are at best but temporary, and should they succeed, would involve us and our posterity in great difficulties, involve us in a vast debt, which would lie so heavy on the country as would greatly check our future prosperity, and discourage foreigners from coming to settle with us. For nobody likes to move into a country where taxes are very high and burdensome.

I submit it to every man, whether it will not be much easier for us by a spirited exertion, for a short time, to collect large sums of our present currency, and pay our expenses as fast as they arise, than if a foreign loan could be obtained, to pay a vast debt of hard money with interest to foreigners in future time, when every dollar we pay, must go out of the country never to return again. Every man ought to consider that his proportion of the public debt is as much a debt fastened on his estate, and becomes to all intents and purposes as much a burden and charge on it, as any of his private debts of the same amount, and must as surely one day be paid; is it not better then to pay it now than to have it lie a burden on him, to be paid in in future time, which may be called for when he may not be in condition to pay it so easy as now. Every prudent man does this with respect to his private debts, and what reason can be given why the same prudence should not extend to the debt which he owes the public? Can any reason be assigned why the States should not imitate the prudence Edition: current; Page: [[24]] and economy of a private man, who happens to be involved for a time in great expenditures, which is, to pay up and discharge as much as possible as he goes, and leave as little as possible to be settled in future time.

To facilitate this, I humbly propose one thing more, viz. To take off every restraint and limitation from our commerce. Let trade be as free as air. Let every man make the most of his goods and in his own way, and then he will be satisfied. Let every man taste and enjoy the sweets of that liberty of person and property, which was highly expected under an independent government. It is a sad omen to find among the first effects of independence, greater restraints and abridgments of natural liberty, than ever we felt under the government we have lately renounced and shaken off. Let the laws point out the duty, and be the bulwark of security of every man.

Nothing gives the people such high satisfaction with any system of government they live under, as the actual enjoyment of the inestimable blessings of perfect liberty and full fecurity under it; this will most effectually induce them cheerfully to support it. No burdens will be thought heavy, or difficulties discouraging, which the exigencies of government may require, when every man finds his own happiness involved in the establishment of the State.

If, on the freedom of trade, any articles should rise in their price, the mischief facilitates this remedy, it makes the payment of the taxes more easy and tolerable. Whereas, if the taxes were collected during the limitation of the market and stagnation of business, the payment would be extremely difficult, and the murmurs high and reasonable; it would be almost like the Egyptians demanding brick without straw. But when the circulation of money is brisk, and the price and demand for goods high, every one knows that money may be raised and taxes may be paid much more easily than in dull times of stagnated business. And this ought to be noticed on another account.

It is necessary our first taxes should be rendered as easy as possible to the people; for tho’ high in nominal sum, if they find them easily paid, the terror and uneasiness which Edition: current; Page: [[25]] high taxes generally raise, will mostly vanish, and the payment will be made without endangering the peace of the State, and these things all considered together naturally lead us to the true answer to the second great question to be solved, viz.

II. How is the army to be supplied? The method I propose, if it can be adopted, will undoubtedly fix the currency and create a great demand for money, and a quick circulation of it; this will of course open all the stores in the State to any purchasers that may offer, and a little prudence used in purchasing, may supply the army to the full, at reasonable prices. Indeed I am rather afraid of overdoing the thing in this way, so far as to cause an appreciation of the money, which I do not think ought ever to be done, for I see no reason why the States should be taxed to raise the money in my pocket to twenty times the current value of it; but this is a great argument, and may be the subject of future discussion.

I must add here, that this method will not only fix our currency and support our army, but will afford another advantage of no small moment: it will take away the capital hope and assurance of our enemies of conquering us; for they depend more on the failure of our funds than on their own force, for this purpose; they count high on the quarrels, contention, oppressions, and mischiefs that will arise from the low, sinking credit of our money; and by this are encouraged to continue the war, which they would relinquish as desperate without it.

I will just note here, that however intolerable the means I propose may appear at first sight, I cannot think them impracticable; the tax I propose is not more than two thirds of the annual taxes in Great Britain; the whole revenue raised every year there is about 12,500,000l. sterling, which is somewhat more than 55,000,000 dollars, reckoning them at 4s. 6d. a-piece; divide this by the number of souls in Great Britain, which are computed at 9,000,000, and we have the sum of somewhat more than 6 dollars per head on each of the inhabitants or living persons there; but, be this as it may, to balance the argument Edition: current; Page: [[26]] fairly, I think it stands thus: on the one side certain destruction, and on the other a tax so heavy, that a middling farmer’s share annually, will be 40 bushels of wheat, 40 dollars hard money, or the value of it in any thing he chooses to sell, to be paid in four quarterly payments. This, if it can be done, will undoubtedly save us, restore our finances thoroughly, fix our currency, and supply our army; without this, I do not see how these great objects can be effected. If any other method can be devised, it is more than all the united wisdom of America has yet been able to find and accomplish, nor do I conceive we have any long time to hesitate; something speedy and decisive must avert our fate.

Thus I have offered my best thoughts freely to the public, and with most upright intentions; I hope they may be received with candour. The facts and reasonings are all open to the examination of every one; if they do not convince, I hope at least they may induce some abler person to sketch out something more perfect and adequate to the great subject.

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A SECOND ESSAY ON Free Trade and Finance.
First published in Philadelphia, August 1779, and dedicated to the several Legislatures of the American Union.

IN my last Essay I observed, that the value of money was nothing in itself, it was a mere relation, it was the proportion between the medium of trade and the objects of trade, which two will be for ever in balance, or equal the one to the other; therefore, if the money or medium of trade be increased, whilst the objects of trade or occasions of money continue the same, the value of the money must depreciate or lessen; and this depreciation must and will be (cœteris paribus) according to the increase of the quantity.

It follows hence, that the value of the current money in any country, cannot be increased by any additions made to its quantity. I do not pretend that these propositions are absolutely universal—I know that money may be so lessened in its quantity, as to be inadequate to the purposes of trade; in which case, an addition to its quantity would doubtless add to its value and use. It is equally true, that the quantity of money may be increased to such an immensity of excess, that the very bulk or enormous mass would render it inconvenient for a medium of trade. I do not mean, nor does my argument require, that my propositions should be applied Edition: current; Page: [[28]] to either of these extremes; it is sufficient for my purpose, that they hold true in any country where the money or medium of trade is so duly adapted and proportioned to the objects of trade, that the one is found adequate and sufficient for the other; in which case, any departure from the said due proportion, either by increasing or decreasing the medium, must verge either towards one or the other of these extremes, and partake more or less of their disadvantages.

It follows from the above, that our national debt of Continental money has not increased in value for three years past, notwithstanding the vast increase of the bulk or nominal sum; and this proposition is proved from fact (which is the best possible proof of any principle advanced in theory) for it is evident that it would not require one farthing more real value, say country produce or hard money, to buy up every Continental dollar now in circulation, than would have been necessary three years ago, to purchase all that was then in circulation; i. e. the depreciation has kept full pace with its increase of quantity. Indeed, I am of opinion, it rather exceeds this proportion, i. e. that the money has depreciated faster than the increase of its quantity would require, and that it would of course require a less real value to purchase it all now, than would have bought it all three years ago. I think the enormity of the sum has carried it within the sensible influence of that fatal extreme which must finally destroy its whole value and use, if the quantity continues to increase.

It appears then that we do not owe a shilling more of real value than we owed three years ago, except the debt abroad and the loans at home which have been contracted since; so that our finances are not in so deplorable a state as they seem to be, and a remedy is much more in our power than would be imagined on the first view of the matter, and may be adopted for three years to come, if the war should continue so long, with less burden, hardship, oppression, danger, damage, and loss than we have, to our sorrow, experienced for three years past.

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It follows then, that all the expenditures of the war for three years past except the foreign debts and internal loans (in which last I include the monies due for lottery prizes) have been actually paid in depreciation of our currency, which is perhaps the most inconvenient method of levying public taxes that could be invented.

As this proposition may be new to some people, I only beg they would not be startled too much at it, but have patience to read a few lines further, in which I shall consider both parts of it.

Without going into minute calculations of the depreciation, or determining with precision the present exchange, I imagine it will not be disputed that the depreciation for three years past has been at least fifty per cent. per ann. i. e. that one hundred pounds at the end of the year, would not buy more goods than fifty pounds would have purchased at the beginning of the year. Try it for the year past: in August 1778, fifty pounds would have purchased sixteen hundred of flour, fifty bushels of Indian corn, five hundred of bariron, one and an half hundred of sugar, twelve pounds of hard money, &c. See if one hundred pounds will buy as much now.

This is arguing on fact, which is stubborn and yields to the prejudice of no man. It appears then that a man who has kept one hundred pounds by him for the space of one year, is to all intents in the same condition he would have been in, if the hundred pounds had kept its value undepreciated, and he had paid one half of it in a tax, i. e. in both cases he would have had fifty pounds and no more left. He has then, to all intents and purposes, paid a tax of fifty pounds for the year towards the depreciation, and has now fifty pounds less money than he would have had if no depreciation had taken place, as much in every respect as his cash would have lessened fifty pounds by paying a tax of that sum.

I have heard that this plea was made use of by the Agents of the New-England colonies, when the matter of reimbursements to those colonies, for their great expenditures in the two last wars, was debated and granted in the Edition: current; Page: [[30]] British Parliament, and the argument allowed to be a good one. The question was, what sums those colonies had emitted for the service of the wars, and what was the value of the bills to be redeemed? the Agents pleaded, that the value was to be estimated at the time of emission, not at the time of redemption of those bills; for when bills of credit depreciate in any country, the depreciation is as much a tax on the inhabitants as the depreciated sum would be, if levied in the usual way of assessment on polls and estates. The argument is indeed a demonstrable one, and supported and justified by plain fact in every view; yet there is such a subtle and strong delusion in the depreciation as obscures the subject, and will almost cheat a man who views it under full conviction, and feels the effects of it; and this tends to render the mischief more ruinous than otherwise it would be, because people who feel it, often mistake the cause, and adopt from thence remedies altogether ineffectual, and sometimes very hurtful, and which often tend rather to increase than cure the evil.

Of this sort, I take to be the whole torrent of censure and abuse which has been thrown out and kept up against the merchants, farmers, and tradesmen, for raising the prices of their several fabrics and goods. Of this sort like-wife, I consider the absurd scheme of limitation of prices, which never fails to limit goods out of the market, at least out of sight; prevents importations and manufactures, discourages the adventures of the most patriotic merchants, who keep their money in trade through all risks, in order to produce foreign goods, without which, neither the country could be supplied, nor the war be supported; checks the industry of the farmers and tradesmen, without which all internal supplies must fail; fills the minds of all with ill humor, and raises the country into factions and heated parties, zealous to devour one another, &c. &c.

These are only a few of the evils which arise from mistaken causes of the depreciation of our currency, and the consequent improper methods adopted for its remedy, all which prove the absurdity as well as the reality of defraying the expenditures of the war in that way, which naturally Edition: current; Page: [[31]] brings on the consideration of the second part of my proposition, viz. this method of paying the expenses of the war is very inconvenient.

1. Because this method brings the burden beyond due proportion, on the most virtuous and useful of our people, such as by prudence and economy have made money and got a good command of cash, lying in debts due on mortgages, bonds, book-debts, &c. and at the same time operates in favor of the most worthless men amongst us, the dissipating, slack, lazy, and dilatory sort, who commonly keep themselves in debt, and live on the fortunes of others. These contemptible, useless characters are enabled hereby, after keeping a creditor years out of his just due, to pay him off with one fourth, yea, one eighth, yea, one sixteenth, yea, one twentieth part of the value of the debt when it was contracted, by which the frugal and industrious are compelled to pay a very heavy tax to those useless, idle men, by which many of them have acquired great fortunes, and of course great weight among us, to the manifest damage of the public; for the weight and influence of this sort of men, ought never to be increased in any community, for wherever we see one of them taking the lead among the people, we have reason to believe that mischief is a brewing, and that the public peace and security is more or less in danger. For the truth of this, I appeal to the experience and observation of all wife and good men.

2. In this way the burden comes very heavy on the most helpless part of our people, who are most entitled to the protection of the state, and ought not to have their burdens increased; such as widows, orphans, and old men, whose principal dependence is on legacies, money at interest, &c.

3. It oppresses the salary-men and all public officers, both in church and state, whose fees and salaries are reduced to almost nothing, and any applications for relief are apt to raise an unreasonable clamor against them, as if avarice and greediness of money was their principal passion. This prejudices the public service, in which they are employed, and discourages men of abilities from seeking or accepting such Edition: current; Page: [[32]] public offices, and lessens the weight and influence of those who hold them.

4. This discourages industry and trade; for if the profits obtained by these waste in the desk, there is little inducement to increase the stock.

5. This defrauds the army of their pay and appointments, and discourages inlistments, and promotes desertions, &c. Many would like the army very well, if they could live by the profession; but few are so attached to it as to be willing to be ruined there.

6. It makes supplies for the army difficult to be obtained; because few men are fond of carrying the fruits of their year’s labor to the army, to be sold for a perishing medium, which every day grows worse and worse.

7. The whole system is grounded in injustice, is contrary to the first maxims of upright dealing, and corrupts the whole course of trade and commutative justice, and of course will soon destroy all principles of morality and honesty in trade, among the people; for here it is to be considered, that money is not only the instrument or means by which trade is carried on, but becomes a sort of common measure of the value of all articles of trade; and therefore I should conceive it would be as dangerous to adopt any measures which would alter its value and render it fluctuating, as to alter the standard weights and measures, by which the quantity of goods sold in market is usually ascertained:—as for example, to shorten the standard yard, lessen the standard bushel, or diminish the standard pound weight, or adopt any measures that tend to this, and will probably effect it. We easily see the dangerous consequences, nor can there be any necessity to expose here the absurdities and mischiefs which must follow.

Enough has been said on this dreary subject; the mischiefs are too glaring to need further proof; a remedy is the great thing now to be sought: ought we then to attempt a remedy of the mischiefs of depreciation, by any endeavour to appreciate our currency? I think not.

1. Because the sum depreciated has been paid by the country once already, by the depreciation itself in their hands, Edition: current; Page: [[33]] and there is no reason why the same country should be taxed to pay it over again: i. e. every man who has had a hundred pounds in his pocket a month, has paid four per cent. i. e. four pounds of tax for it at least; but this is not the worst of it, for he has likewise paid four per cent. per month on all the monies that were due to him during the whole time (by which the public were not benefited.) But execrable as this method of supplying the public exigencies may be, it has had its full effect, and therefore there can be no reason that payment should be made over again.

2. The evil arises from the fluctuation and changeable state of the currency. It matters little to the community whether it rises or falls, the fall of it has hurt the rich, the rise of it will ruin the poor; but to continue the fluctuation by appreciating it, is to continue the whole evil in all its destructive force and ruinous effects.

3. The mischief is done, and ought by no means to be repeated, the widows and orphans are already ruined, and I think it needs no proof that almost all the money is now possessed by people who have bought it at the present value, and shall the widows and orphans, with the rest of the sufferers, be taxed to raise or appreciate the money in the coffers of the rich, up to twenty times the present value of it? Verily I trow not.

4. Any probable attempt to raise or appreciate the value of the money, would hoard it immediately, and

5. Destroy our trade; for the rise of money in the desk would be better than the profits of any trade it can be employed in.—And

6. The sacrcity would soon make the payment of taxes impracticable.—And

7. Every poor man would lie perfectly at the mercy of the rich, who alone would be benefited by his distress; for if the poor should run in debt to the rich in the beginning of the year, the debt would be much increased by the appreciation at the end of the year, and so from year to year, till the sum would rise beyond the utmost abilities of the poor man to pay it, and he must of course be perfectly at the mercy of his rich creditor.—Hence

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8. Popular discontents, and perhaps insurrections would probably be the consequence, and after all

9. This plan of appreciation would not be any remedy to the principal sufferers by the depreciation; for not one tenth part of the appreciated currency would probably be found in the same hands that suffered by the depreciation; the increase of tax would be more to the greatest part of the people, than all the profits they would gain by the appreciation.

10. It is not supposable that thirteen General Assemblies would concur in voting and levying such a useless, burdensome, and pernicious tax:—nor if they would, is it likely that the people either could or would pay it.—Therefore,

11. It appears that these reasons, which prove that this ought not to be done, all tend to prove that it cannot be done, and this is a good reason why it ought not to be attempted. But to sum up the whole argument in one word,

12. All the mischiefs arising from a depreciation, would equally arise from an appreciation; but in an inversed order, and I think it will appear plain to any person of discernment, who duly and attentively considers it, that inversing the order, will infer many mischiefs more ruinous to the community, than those we have already felt from the depreciation: but in any view, the very idea that we are to live under the curse of a fluctuating currency eighteen years longer is intolerable.

Therefore I humbly propose, that the foolish method of denying the depreciation or lowering it below what it really is, may be wholly discontinued, and that as soon as the value of the currency is fixed, there may be a* scale or table of exchange established as near as may be to its then present true value, and that hard money be received and paid in the Continental Treasury according to it: this will effectually prevent its appreciation, and if means can be found to collect monies sufficient for future expenditures, which Edition: current; Page: [[35]] I do not think difficult, no further depreciation need be apprehended, the currency will become fixed, which is all that the safety of the state requires, and all that we can reasonably hope for, or even wish to accomplish.

I beg leave to insert here one proposition more, which I think deducible from the foregoing ones, viz. that if any country which had a medium of trade properly balanced and adapted to the purposes of trade, should by any means receive a large addition of money without an increase of the objects of money, it would be more the interest of that country to call in, and destroy that additional quantity by taxes (if it could not be drained off speedily some other way) than to let it circulate among them; for example, if by opening mines, by large treasure trove, by large success and captures in war, or by too many presses the money should be increased beyond the due quantity necessary for the purposes of a medium of trade: in such case, I give my opinion, that it would be more for the benefit of such country, to call in and destroy such surplusage of cash, by taxes equally levied on all, than to permit it to circulate among them.—For

1. This increased quantity of money, if suffered to circulate, would depreciate till it had duly diffused itself over the country, when it would acquire a certain rate of exchange, and its value would become fixed in such a manner, that the value of the whole would be just equal to the value of the money which was in circulation before the increase happened, and consequently the country would gain nothing by it, but an increased nominal sum; just as if the standard yard should be shortened one half, and thereby increase the number of yards of cloth in the country to double the former number, but would not add one inch of new cloth, or enable the owners of all the cloth to make one garment more than before. But

2. While this was doing, vast mischief would arise from the depreciation; the legacies of the widow and orphans, the salaries and fees of public officers of church and state, the pay of the army, the value of all debts due, the standard of all contracts for money, &c. would be lessened to the most manifest injury of the creditors. Examples of Edition: current; Page: [[36]] which dreadful effects we see daily before our eyes—this must surely force the most striking conviction.

3. I conceive these mischiefs would prove a much heavier burden on the country, and would have much worse effects, than could arise from a tax to amount of the increased quantity of money levied on the inhabitants.—For

4. The inhabitants could not be impoverished by such a tax, as there would be as much value of money, and as much goods and other estate in the country after the tax was levied as before, and all the loss to the country would be the time and charges spent in collecting it; for all the goods sold for the payment of this tax, would still remain in the country, and continue as valuable as they were before they were sold.

5. The contentions, resentments, and ill-humor, which a depreciation naturally generates, would by this method be prevented, which alone, in my opinion would, if not prevented, impoverish the country more than the whole tax, even if the money was all borrowed from abroad to pay it. Only observe two neighbours inflamed with rage and resentment against each other, and see what time, money, and labor they will spend, and how much they will engage their several friends in their quarrel, and how all kind offices of friendship and mutual assistance are totally lost between them during their anger. By this we may form some guess at the degree of impoverishment which a country must suffer by general discontents, and numberless instances of personal injuries and consequent resentments.

Hence it follows clearly, in my opinion, that it would be more for the interest of the Thirteen United States to call in and sink their Continental bills as fast as they issue, than to receive a sum of gold every year equal to the money issued, from some foreign power, as a perfect gift never to be repaid, i. e. we had better pay every year, by taxes, the whole expenditures of the year, than to receive the amount of those expenditures in cash from Spain as a free gift. Tho’ I introduce this proposition as a corollary, yet as it is of some consequence, we will, if you please, view it awhile, and consider the operation and effects of its two Edition: current; Page: [[37]] parts, and we shall be better able to judge which of the two would contribute most to the real welfare and happiness of the country.

1. The tax would fix the currency, and thereby give establishment to every branch and department of business, trade, war, civil police, and religion, which has any connexion with money; but the gift would make such an increase of the circulating cash as would depreciate it (for hard money can and will depreciate as well as paper bills, if increased too much) and thereby every department of business, trade, war, civil police, and religion which has any connexion with money, must languish and be enervated.

2. The tax will promote the industry, prudence, and economy of the people, but the gift would naturally introduce and encourage idleness and dissipation. Few men will rise early and eat the bread of carefulness, when money flows in upon them without their own anxious care. A man, pressed with a demand for money for a tax or any other debt, does not yield to his own appetite, or the request of his wife or child for a luxury, so easily as the same man would do, with plenty of money, and no pressing demand: for the truth of this I appeal to the feelings of every man.

No virtue is so fixed in the human mind as to continue long undiminished without its usual motives and inducements, and it requires no great experience in the world to show us the danger of lessening any of these; the very beginning of remissness of virtuous habits ought to be as alarming as the swallowing of a slow poison; and this, as applied to my subject, is demonstrated by a very common observation, that fortunes suddenly acquired without the industry of the possessor, rarely ever increase his happiness and welfare, help his virtuous habits, or continue long with him; they most commonly ruin him. Money in a state is like salt in cookery; some of it is very necessary, but too much of it spoils every dish, and renders the whole dinner unsavory to the taste, and hurtful to the health.

3. The tax will operate in a way of justice to all, and therefore will give general peace and satisfaction to all good Edition: current; Page: [[38]] men, to all genuine Whigs and well-disposed people, and will silence the clamors and disappoint the hopes of the Tories, which are grounded principally on the uneasiness and jealousies, injuries and resentments which wrong steps will raise among the people. The operation of the tax would be just this; it would compel the man who stays at home and renders no actual service, and furnishes no supplies to the war, to pay as much as those do, who render the actual service and furnish the supplies: those who render personal service and furnish supplies, contribute those great aids in solid substance within the year; and therefore those who stay at home ought to pay their quotas of solid substance also within the year. There can be no reason given why those that go into the war should render their service within the year, and those who stay at home should pay nothing, or be trusted to some future day.

This method is grounded on such manifest justice, that no Tory, however litigious, can with any good face object to it; and therefore, however chagrined at heart he may be, he must keep his mouth shut, or look out for some other subject of complaint to make a noise about; but the natural operation of the gift would be very contrary to this; there would be so many schemes and pretences set on foot to draw for the money before it could leave Spain; so many hungry favorites crowding round every office of distribution in every department, and in short, such a scramble for the biggest share of it; and so much chagrin, disappointment, and mortification occasioned; and so many jealousies, quarrels, and resentments excited by it, as would, in my opinion, injure and impoverish the States much more than the tax would do. But all this I submit to those who have been best acquainted with public boards and offices.

4. The most of the above arguments have been confirmed by facts in many notorious instances, which are the best proofs in matters of this sort which can be advanced: the spoils and luxuries of Capua ruined Hannibal’s army; the sack of Carthage and plunder of the rich, eastern, conquered provinces corrupted the morals of the Romans, destroyed Edition: current; Page: [[39]] their economy, brought in luxurious excesses, bred the most mortal quarrels, overturned the commonwealth, introduced tyranny, and ended in the most tragical destruction of the Roman Empire; the Portuguese (who were once most untainted in morals and most intrepid in war) it is said, were ruined by the mines of the Brasils, and are now an enervated people, without manufactures and internal supplies, a nation of Lords, poor in the midst of money, and proud in the midst of want, and are scarce a shadow of their ancestors.

And to come nearer home, the successes and spoils of the last war ruined the English nation; they are no longer that wise, that faithful, that benevolent, humane nation which we were ever taught to esteem them, but rude, faithless, cruel, savage, avaricious, sordid, &c. with scarce a single virtue left in their character; the principal remains of our ancestors is their prowess in war; but even this is perverted: this, which was heroism in them, is inhumanity in the present generation; the sword, which was the terror of their enemies, is by the present race sheathed in the bowels of their brethren.

It follows hence, I conceive, very clearly, that the riches of a nation do not consist in the abundance of money, but in number of people, in supplies and resources, in the necessaries and conveniencies of life, in good laws, good public officers, in virtuous citizens, in strength and concord, in wisdom, in justice, in wise counsels, and manly force.

From all these considerations, it appears plain to me, that sudden acquisitions of money are dangerous to any country, and have in many instances proved very ruinous and fatal to states and kingdoms as well as individuals; from hence I think we may fairly and strongly conclude, that it is not the wisdom of America to attempt by any means of gift or loan, an acquisition of money from any foreign powers, but by strong exertions of our own to furnish our own supplies. We have money enough for our own purposes, and as good as any in the world, if we can be wise and firm enough, by proper measures to fix its value, and preserve it from future fluctuation.

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But if these arguments should not be convincing, I will venture to add one more, which with me has great weight.

5. By a tax we shall furnish our own supplies in a sure way, not liable to disappointment by any caprices of others, nor subjecting us to any sort of dependence on foreigners; we shall work out our own salvation without dependence on any power but Divine Providence, which we may ever acknowledge without danger of insult; but if we receive aids from foreign states by loan or gift, the obligation conferred on us will be ever great in their opinion, and should we ever have occasion in future time to adopt any measures not perfectly consistent with their views and demands, we must be insulted with large exhibitions of the present favors, and as large and plentiful accusations of ingratitude, and it may be long before we hear the last of it.

As it is more reputable for a man to acquire a fortune by his own industry, than by heirship, favor of friends, or sudden accidents, so I think our own deliverance and establishment, wrought out by our own strong exertions and virtuous efforts, will be more honorable and safe for us, than to receive these great blessings from the gift of a neighbour, were he willing to bestow them. The English never will have done holding up to the view of the Dutch the supplies and aids they received from the English in Queen Elizabeth’s time, and the Portuguese are obliged to hear a great deal of the same sort of language, on the score of assistances received by them from the English in the late wars.

Indeed I know not how we can call ourselves independent, if we are to lie under such sort of debts to our neighbours, especially if to the obligations of gratitude, we are to be loaded with the additional one of large sums of hard money, with a corroding, annual interest to devour the proceeds of our labors and trade for ages to come.

I would sooner consent to bear any present burden, not absolutely intolerable, than find myself and posterity loaded with such a heavy, galling debt, to last, as other national debts most commonly do, for ever, and the States so Edition: current; Page: [[41]] oppressed and drained by it, as to have scarce spirits or strength left to resent any insults or injuries that may be offered in future time, or repel any invasions that may be attempted.

Indeed the alliance we have formed with France, is grounded on such generous principles of justice, mutual interest, and independence, as plainly demonstrate that it is not the wish of France that our minds ever should be disturbed by any of these painful feelings; and I think it would be very mean in us to abuse their generosity, and we might be ashamed to worry them for supplies, which we could better furnish ourselves than receive from them, especially to solicit France for money to pay the interest of loans from our own people, certainly has a bad look. If a son should demand security of a stranger for monies lent to his father, people would certainly say something.—

We hope to form an alliance with Spain on principles of equal justice and mutual benefit, but we shall soon lessen our character in their eyes, if we improve our first acquaintance in begging aids, which, with proper application and industry, we could well do without. But whenever real necessity does press us beyond our own powers of relief, we may then, without humiliation, apply for help to our friends, and I do not doubt but they would give with pleasure to our real necessity, what they would either deny or grudgingly spare to our laziness or needless solicitations.

I presume it is needless to add any more arguments to prove the necessity or expediency of taxing equal to our expenditures, but the great groan still is, that this is impracticable, it cannot be done. To all I have said before, I beg leave here to add some further arguments to prove the practicability of this method; three years ago, it was said, there is no danger yet, it will be time enough to tax some time hence; it is now said, it is too late, we are involved so much that a tax adequate to our present occasions for money is impossible; had we begun sooner, it might have been done, but now it is too late. I take it that all this talk arises from an improper view of the subject.

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1. We are under as good advantages to relieve ourselves by taxes now as we were three years ago, to all intents and purposes, and in some respects better; we are involved in no more debt, except the foreign and home loans, than we were then; the circulating cash is no more in value now than it was then, the increase of nominal sum makes no difference; and therefore, if it was necessary to call it all in (which, I conceive, is by no means the case) it might be done at the same expense now as then, i. e. it would not require any more hard money or country produce to purchase it all in now, than it would have required three years ago; and we have sundry advantages in favor of taxing now, which we had not then, viz. 1st. A general conviction of the absolute necessity of taxing. 2d. Established legislatures to levy the tax; both which were wanting three years ago. 3d. The money to be collected by the tax is more equably diffused or spread thro’ the Thirteen States than it was three years ago, and therefore the people in the remotest parts, as well as those who live near the seat of war, are enabled to pay their tax. 4th. People are more settled in business than they were three years ago; the violent shock of the war threw very many people out of their common course of business, or at least much incommoded them; but they are now more settled, either in new branches of business, in public employments, or find the profits of their former business in some measure restored. 5th. The farmer and most tradesmen can pay their taxes much easier than they could three years ago, because there is much greater demand and price for the fabrics of the one and the produce of the other, than there was three years ago. To these many other reasons might be added, all grounded on facts of public notoriety, and therefore are freely submitted to every person who has resided three years among us.

2. All the services and supplies for which the tax is wanted, are actually furnished every year by the Thirteen States, and have been for four years past; now is it more possible, more reasonable, or more easy to compel a few individuals to furnish these services and supplies without payment, than to lay the burden in proper proportion on Edition: current; Page: [[43]] all, and to compel every individual to furnish his part? i. e. I do contend it is more easy, more reasonable, and therefore more practicable, and of course very possible to compel those that stay at home and render neither personal services nor supplies to the war, to pay as much real value or substance in money as those do who render the services or furnish the supplies; and if any of these stayers at home think this comes too hard on them, let them change places awhile with those that do render the services or furnish the supplies, i. e. let them go into the army in person, or send their corn, their beef, or other supplies, and when they have tried both, they will know which is easiest, and will always have their option to take the one or the other, and will be convinced that both are possible and practicable.

Can any man make any reasonable and weighty objection to this? Yet this is all that is required; for when the services are rendered, and the supplies are furnished, and both are paid for, the whole business is done, and the tax has had its full effect.

I will venture to add my opinion, that this reasoning will be verified in fact to very good purpose, viz. that when it is observed that the man who renders the actual service is paid fully for it, and the man who stays at home must pay his full quota towards it, many who now stay at home, will be induced to go and render the actual service, and thereby avoid making the payment at home, and become entitled to receive it in the army, which will greatly facilitate the recruiting service. An object of no small magnitude.

3. The tax which I propose, collected in quarterly or monthly payments, will occasion such a quick circulation of money, that every bill will probably pay its value many times over in a year, as it must do every time it passes from hand to hand; it will fly from the Commissary to the farmer, from him to the Collector, from him to the Treasurer, from him to the Commissary, from him to the farmer again, &c. in a circle often repeated in a year; consequently it would be possible to levy a Sum in a year by Edition: current; Page: [[44]] taxes, much exceeding the whole sum of current cash; it would render the whole Thirteen States like a full market, where all persons are eager to sell all they have for sale, and as eager to buy all which they have need of, and if this circle of business was permitted to run without any restraints, it would render the procurement and payment of money as easy as the nature of the thing admits, would vastly lighten the burden of taxes, and would give such great advantages, both to the farmer, mechanic, and trader, as would in good measure reimburse the tax itself.

4. Some peculiar circumstances of this country much contribute to make the payment of taxes practicable and easy. Those places which have suffered most by the war, lie nearest to the seat of it, and of course have the greatest plenty of money, and have the benefit of the quickest demand and highest price for every thing they have for sale, whilst it happily falls out, that those towns and counties that lie most remote from the seat of the war, and have the greatest scarcity of money, yet have been least impoverished by the war, and are almost every one of them fine, grazing, fruitful countries, which produce great quantities of beef, mutton, and pork, which may be easily conveyed to the army on foot, and thereby facilitate the payment of taxes and supply of the army at the same time.

Another favorable circumstance is this, the enemy cannot supply themselves, especially with those articles we most want, otherwise than by importing them; and as their vessels cannot always go under convoy, they often become a prey to our ships of war and privateers, by which we gain a supply of foreign necessaries, without contracting a foreign debt; those concerned are enriched, the objects of trade are increased, and the payment of taxes and supply of the army greatly facilitared.

The benefits of this we have often experienced, and perhaps might increase them, if our cruising business was more properly conducted, and more liberally encouraged. Upon the whole matter, I beg leave to close this Essay with a short view of the present state of our finances, then Edition: current; Page: [[45]] to offer my propositions of trade and finance, and lastly, point out the effects and operations which I conceive these will have on our trade, currency, and army.

I. Our present debt is what we owe abroad, all our domestic loans, and all the paper currency now in circulation, with enough more (if more is necessary) to balance our public accounts.

II. The currency I rate at its present value; and admitting the nominal sum to be about 160,000,000 of dollars, the real value may be 8 or 9,000,000 of dollars, and which I conceive is not a larger sum than is at all times necessary for a medium of trade in the Thirteen States.

III. The great interest of these States, I take to be, fixing the value of the currency, and preventing the further fluctuation of it, either by depreciation or appreciation; for I conceive these to be equally destructive, or if there is any difference, the latter is the worst of the two.—For this purpose,

IV. I think the further increase of the currency should be prevented, and the presses stopped as soon as may be, and this I think may take place on January next, nor do I see how it can be done sooner. What the further fluctuation of the currency will be in the mean time, is uncertain; but the two most powerful means I know of, to prevent the future depreciation, are, the heavy tax to be collected in this time, and taking off all restraints from trade; if this last is not done, the scarcity of goods will be so great, and the objects of trade so few, that no wisdom can prevent, or force suppress, the exorbitant rise of goods before that time, especially of salt, rum, coffee, tea, and other articles of great consumption, that have been limited much below the cost and charges of importation.

V. I propose that a course of taxes be instituted, to be paid monthly or quarterly, equal to the public expenditures.

VI. When the presses are stopped, and an effectual method of supplying the Treasury by taxes is well secured, the Continental money will in a short time make for itself an exchange, or gain a fixed value; it is impossible now to say Edition: current; Page: [[46]] what that value will be, but however it fixes, it will be right, and then I propose,

VII. To fix the exchange according to that value, by directing that hard money shall be paid and received in the Treasury at that exchange, which will effectually prevent its appreciation; and if an adequate tax is well paid, the depreciation also will be effectually stopped: e. g. if the exchange should be fixed at 20 for 1, and any person is disposed to pay his tax in hard money, let 1 dollar be received in full for 20 paper ones, and let all payments be made from the Treasury by the same exchange.

But you will say, what is to become of the public faith? and I say, what is become of it already? I leave it where I found it, I do not make it any worse, but endeavour to preserve it from further decays. If nineteen parts out of twenty are dead already, I am for preserving the twentieth part which remains alive; perhaps by good management and proper nursing, it may grow into full magnitude; but to effect this, it appears to me very necessary to purge it of all those deadly mixtures and bad adherents which have already brought it within an ace of total destruction.

However this may be, I think it appears very plain, from what has been before advanced in this Essay, that continuing the dreadful mischiefs and injuries of a fluctuating currency for eighteen years* to come, will no how atone for the wrongs, or compensate the damages, incurred by that destructive delusion in four years past, and I cannot conceive on what principles any man could wish to purchase such a deadly evil for many years to come, at the expense of heavy, galling taxes, almost as useless, difficult, and desperate, as the rolling of Sisyphus’s stone.

VIII. And for the same reason, all debts due from or to the Treasury, ought to be paid at the exchange which existed at the time they were contracted; and therefore, I think it necessary to form a table or rate of exchange, to be continued from the first depreciation of Continental hills Edition: current; Page: [[47]] up to the aforesaid period, when they shall become of fixed value; and that all Loan-Office certificates be paid according to the exchange which existed at the time in which the certificates were dated, and that all other debts be paid at the exchange which existed when they were contracted, and all interest due ought to be paid at the same exchange as the debt out of which it grows.

This appears to me so manifestly just and reasonable, that I cannot think any objection can be made to it, and therefore to offer any arguments in support of it, would seem to call into doubt the justice of my country; I have only to observe, that great judgment and accuracy will be required in forming those rates of exchange, as any error in these would introduce an error into the adjustment of all contracts for money, which yet remain unsettled.

9. The currency fixed as above, will be just sufficient for a medium of trade and no more, and if we can by firm and proper, steady conduct, keep it fixed, it will answer all the ends of a medium of trade, without any inconveniency, for no one can suppose it is of any consequence, whether we estimate a dollar at three pence, or six pence, or nine pence, or ninety pence, if it continues the same at all times, with no more variation than is ever incident to the nature of money.—Therefore

10. There will be no immediate occasion for further taxes for sinking any part of the bills, which are or shall be in circulation on the 1st of January next, for no reason can be assigned why the country should be taxed to lessen the quantity of money in circulation, when there is no more in being than is necessary for a medium of trade.

11. The method I propose will, by its natural operation, keep the army full of men and well supplied, and we may be in good condition to carry on the war any length of time that may be necessary, till it can be closed by a safe and honorable peace.

12. And this method will also, by its natural operation, fix our finances on the best and surest footing that can be wished, our currency will be as good as any on earth, and all the resources of a most plentiful country will be properly Edition: current; Page: [[48]] and effectually opened for the use of the public, at whatever time and to whatever amount the public exigence and necessity may require.

13. When the war shall cease, it will leave us in a manner free of debt and little impoverished; we may easily, when the war is over, pay our foreign and domestic loans, and whenever we find it necessary, sink the whole current bills, all which may be done in a short time, and without any burdens so heavy as to endanger the peace or prosperity of the States. Every other scheme which I have heard proposed, leaves us subject to two dreadful calamities: 1st. The danger of sinking under the weight of the war. 2d. If we get through that, yet we shall be left under such a load of debt, which must be sunk by such long and galling taxes, as will almost make our lives a burden and our liberty a dear purchase, yea, the weight of the debt will abridge our liberty itself, for I know not how any persons or states can be called entirely free, who are deeply involved in debt beyond their present powers of payment.

14. This method will be a good criterion by which we may distinguish the Whigs from the Tories, this scheme touches the present cash, it compels the present and actual contributions of every one to the great cause of American liberty, this will rouse the feelings of every Tory, partly because his present cash is called for, and partly because it establishes the system of liberty which he wishes to see destroyed. And as we have reason to suppose that much English gold is spread among us, for the purpose of bribing our most popular and able men, it will be of great consequence to discover who they are that may be thus engaged to destroy us, and as they probably will assume the character of zealous Whigs, they cannot be better distinguished than by the temper in which they receive such propositions, as promise an effectual remedy of the mischiefs and dangers which most threaten our destruction, and at the same time blast the surest hopes and confidence of our enemies.

Thus I have a second time given my thoughts, with the greatest freedom, on the great subject of free trade and finance, a subject perhaps as difficult and intricate as any Edition: current; Page: [[49]] whatever. A good financier is as rare as a phœnix, there is but here and there one appears in an age, yet in our present circumstances, a good financier is as necessary as a general, for the one cannot be supported without the other. I do not pretend to be equal to this great subject, I know I am not, but in these times of distress, every one ought to contribute what he can, and my fortunes are so impaired by the depredations of the enemy, and my health and constitution so broken by their insult and cruelty, that I have little left but sentiments and kind wishes to bestow, and as the widow’s mite was of great account in heaven, I hope my mite may be candidly received, as it is most uprightly intended.

I know the limitation of trade, the doctrine of loans, and appreciation of our currency are ideas much favored by very many zealous people; my Essays are directly opposed to them all, and I have only to say in excuse, that I should not venture to face the censure of such characters, if I were not really convinced of the high impropriety of all the three mentioned doctrines, and the absolute necessity of adopting sentiments and measures the most opposed to them.

It is with great pain I differ in sentiments from many gentlemen of shining abilities, great experience, and most undoubted integrity; and was the importance of the subject at the present crisis less, I should not obtrude my thoughts on the public, nor have I the vanity to imagine that the feeble Essays of an obscure individual can correct the errors of a Continent; I only hope my publications may be so far regarded, as to bring on a most serious inquiry and thorough discussion of the weighty subject, by men of genius and abilities, equal to the mighty task, that so the real source of our calamities and their proper remedies may be discovered, and the wisest measures may be adopted and pursued with diligence, spirit, and decision.

For however weak or ridiculous my Essays may be deemed, the subject of them will be acknowledged of sufficient weight to engage the attention of the most able and respectable characters among us.—Si nôsti rectúis istis, candidus imperti, si non, his utere mecum.

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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 Edition: current; Page: [[51]] 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 Edition: current; Page: [[52]] 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 Edition: current; Page: [[53]] 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.

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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.

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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.

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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.

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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, Edition: current; Page: [[58]] 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.

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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.

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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 Edition: current; Page: [[61]] 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 Edition: current; Page: [[62]] 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 Edition: current; Page: [[63]] 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.

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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 Edition: current; Page: [[65]] 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 Edition: current; Page: [[66]] 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 Edition: current; Page: [[67]] 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 Edition: current; Page: [[68]] 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 Edition: current; Page: [[69]] 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, Edition: current; Page: [[70]] 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.

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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.

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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 Edition: current; Page: [[73]] 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.
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A FOURTH ESSAY ON Free Trade and Finance.
First published in Philadelphia, February 10, 1780.

THE system of taxation equal to the public expenditures, adopted and recommended by Congress,* is grounded on the most solid and demonstrable principles, and, if there is no error or defect in the execution of it, cannot fail of producing the two great ends expected from it, viz. Supplying the expenses of the States, and reducing our currency to a fixed and permanent value. These two effects will be produced by the natural operation of this system, without any force or extraneous helps.

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Yet it is to be noted here with care and concern, that when these great and steady principles come to operate on the present distracted state of our currency and finances, very sad and perhaps fatal effects will be produced, and infinite injustice done, even by this forcible remedy, tho’ the most salutary and only effectual one, if some care is not taken to direct its force and limit its first effects. The appreciation of our currency is among the first of these ill consequences which I fear, and would guard against. The evils of this I have considered in my Second Essay; but as what I there urged either has not been understood or regarded, I think it necessary here to resume the subject, which certainly merits the highest attention of every American.

The value of Continental money is what it is now worth to the possessor. The present exchange of Continental money Edition: current; Page: [[76]] is to hard money at the rate of about 40 to 1, tho’ it is very fluctuating; at this exchange of 40 to 1, which is very near the truth, and for which I appeal to the merchants’ and goldsmiths’ books, I say, at this exchange, our debt of continental money, i. e. all the continental money in circulation, is worth 5,000,000 of dollars in hard money. For the reader need not be told that that value is found by dividing the whole sum of our currency, viz. 200,000,000 of dollars, by the exchange, viz. 40, which will make a quotient of 5,000,000 of dollars of hard money.

If this exchange is reduced, say to 20 for 1, it will increase this public debt to 10,000,000 of hard dollars. Therefore, it follows, that every appreciation of the money increases the public debt, and to an amazing degree, by movements, indeed almost imperceptible, yet certain, and to an amount almost beyond belief. For if the exchange should fall to 10 for 1, the debt would rise to 20,000,000; an exchange of 5 to 1 would raise the debt to 40,000,000 of hard dollars, and so on till the debt would rise to 200,000,000 of hard dollars, and all this without the least benefit to the public, but in every view to its detriment. For, over and above the vast increase of taxes necessary to pay this increased debt, many other evils still worse than the tax would follow, to which I must beg the reader’s most ferious attention; for however out of sight and distant it may appear, the mischief is infinite, and must be fatal, if not prevented.

1. This appreciation will raise the value of the money in the chests of the possessors, in proportion as it increases the public debt. This will raise the great money-holders into nabobs, so rich there will be no living with them. They have already, it is generally thought, much more than their share. Men of overgrown riches, especially of sudden acquirement, are dangerous to any community. They are not generally people of the best refinement of manners or wisest discretion, and therefore, their influence in the community (which will ever be, cæteris paribus, in proportion to their wealth) will be dangerous; but were they all the best of men, such amazing and sudden acquisitions of wealth would be enough Edition: current; Page: [[77]] to spoil them. We find, by long and various experience, that human nature cannot bear, without corruption, such sudden leaps into the heights of greatness, prosperity, wealth, and influence.

2. This same cause will induce all men to hoard their money, when they find it grows better and better daily in their chests. Money will soon become so scarce, as not to be obtained without great difficulty, and this will increase the value or appreciation of it; for the value of money will ever be in proportion to its scarcity and demand. Thus every stage of this mischief will tend to increase the evil, and lead on to further stages of the same calamity and distress. This is obvious to every one.

3. This same cause will ruin our trade and manufactures: for the rise of money in the desk will be more profitable than any trade or branch of manufacture. This will ruin all industry; for the rich will not go into business, and the poor will not find employers, and this will produce scarcity of all goods, both home produced and imported, and of course general distress and want must follow.

4. This same appreciation will increase the public debt, and consequently will increase the taxes by which it must be paid, and that in proportion to the value or amount of the appreciation. The appreciation of money is like an account in a merchant’s book; there must be a debtor and creditor to it. It is not possible that one shilling should be gained by one person in this way, which is not lost by somebody. If you make the money more valuable in my pocket, it will cost the public more to redeem it; and therefore, if it was to be appreciated up to its original value, every man’s tax must be multiplied by the present exchange, i. e. made about 40 times greater than it need be, to redeem all the money at the present value; and therefore it is probable those who think the present taxes are not more than the fortieth part of what they should be, will be zealous promoters of the scheme of appreciation.

5. This same thing will increase every private debt. For nothing is plainer than this, viz. if the money is more valuable at the time of payment than it was at the time of Edition: current; Page: [[78]] contract, the debt is thereby increased, i. e. it will take more hard money, or more wheat to pay the debt, than would have paid it at the time of contract. This brings on the inevitable ruin of many poor people, who cannot avoid being more or less in debt for rent or some other necessary thing. It is hard enough for them to pay their debts at their just value; but when the sum comes to be increased, perhaps doubled or trebled in a few months, the payment becomes either extremely difficult or impossible. This might at first please the rich pretty well, but they would find their mistake, for they would be obliged soon to accept a notice of bankruptcy, instead of payment from their debtors.

6. The great cry for appreciation is, that those who have suffered by depreciation ought to have the benefit of a compensation by the appreciation of the currency; but this is nugatory, and will prove in the end a perfect deception. For not one tenth part, perhaps not an hundredth part of the money, when it shall appreciate, will be found in the hands of those who have suffered by the depreciation. It will be no adequate remedy to any of them, but will be an increase of distress and injury to far the greatest part of them.

Those persons who have suffered by the depreciation, but by the chance of the times have been able to make it up some other way, so as to be able to hoard up sufficient sums of money to take advantage of the appreciation, those, I say, are not the great objects of my concern; but the helpless widow, the fatherless infant, and a thousand others, who have been obliged, thro’ the deficiency of their interest, to spend on the principal, till it is all or mostly gone, those, I say, are the great objects of pity; their cries for justice and compensation ought to be heard; the appreciation does them no good, for they have not cash on which it can operate; for nobody can take any benefit of the appreciation, but such as have more cash on hand than all their taxes will amount to; but the aforesaid widows, &c. are by the appreciation plunged into an increased distress and injury; for if they have an acre of land, or a horse or cow left, they must be loaded with a vast increase of taxes, Edition: current; Page: [[79]] in order to appreciate the money which they have lost, and which now lies hoarded in the coffers of their rich neighbours, who have gotten it from them.

From this view of the matter, it appears that many people may imagine that they shall receive an advantage from the appreciation, and therefore cry loudly for it, who will, in the end, be greatly hurt by it. It seems they ask they know not what, like the mother of Zebedee’s children, who, in the ardency of maternal affection, petitioned our Saviour that her two sons might sit, the one on his right hand, and the other on his left, not considering that the purport of her petition was, that one of her sons might be saved and the other damned.

7. The appreciation of the Continental bills will continue thro’ the whole course of it, all the mischiefs of a fluctuating currency. This destroys or varies the standard or common measure of value of all things bought or sold; renders all money-contracts and debts uncertain; corrupts the equity and alters the force of our laws, by varying the fines, forfeitures, and fees limited by them; and in short, throws both the private man in his dealings, and the judge on the bench, into such perplexity and confusion, that neither can have due knowledge of right, even when they may be disposed to do it, whilst the wicked have the greatest latitude in which they may practise shocking wrongs, and that in the face of the sun, and with impunity. This suspends the rewards of virtue and the punishment of vice, corrupts the morals of the people, and in the end produces every evil-work. Surely this picture is dreary.

8. From all these mischiefs no one benefit can arise to the public. Every advantage of the appreciation goes to the rich men who have got the money hoarded, and to them alone. Why then all this more than Herculean labor of appreciating the money? why all these risks and public dangers? why all this multiplied burden and distress on our people? The uses of the currency are to every purpose as great to the public, if fixed at the present value, at two pence or three pence the dollar, as at any other value that can be named.

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9. The appreciation of the currency will destroy the equity of the taxation itself, according to the known and received principles of it, viz. that all estates ought to be taxed in proportion to their value, in such manner that every man’s estate, after the tax is paid, shall bear the same proportion to his neighbour’s as before, i. e. so that no man should be enriched or impoverished by the tax more than his neighbour.

But if the money is appreciated, the tax will have a very different effect, as will be obvious at first sight, only by viewing its operation in one very familiar instance, viz. Suppose two brothers have each a plantation of equal value, say worth 1000l. hard money each, and one of them sells his plantation for 1000l. hard money, and changes that money into 40,000l. continental money, and the tax comes on; and we will further suppose they are both taxed according to the value of their estates, i. e. equally, and that the tax necessary to appreciate the money be 20 per cent. on the whole value; it appears then plain that the tax of the one, who keeps his plantation, will be 200l. hard money, and the tax of the other, who has 40,000l. continental money, will be 8000l. of that money; consequently, the first will have a clear estate left of 800l. hard money value, but the other will have an estate worth 32,000l. hard money, for by the supposition all the money he has left will be appreciated up to its original value, i. e. to the value of hard money, and will be worth 40 times as much as his brother’s estate. But if all these arguments do not convince, I have one more, which, I think, must do for the hardiest opponent; it is this:—

10. The scheme of appreciation will destroy itself; it is in its nature impracticable, and its own operation will work its destruction. For the appreciation of the currency will increase the taxes and public burdens to such an enormous and insupportable amount, that the people neither can, or will, or might to bear them. When they come to be told that all their taxes are not at all for the benefit of the public, but are for no other purpose than to increase the value of the money hoarded by their rich neighbours (and they certainly Edition: current; Page: [[81]] will find this out) they will join in one general cry against the oppression, with one voice damn the taxes, and swear they will not pay them.

Then the mighty bubble will sink into nothing, and with it will go all our revenue, public faith, defence, honor, and political existence.

Very many things more might be added on this sertile subject; but if what I have said in my Second Essay on this subject, and what I have repeated and added here, is not sufficient for conviction, it is vain and useless in my opinion to add more, and shall only here beg my reader’s patience and attention a moment to an affair of my own.

I do here, as an individual, enter my protest most solemnly against this most fatal, useless, and chimerical scheme of appreciating the currency, and am determined to leave a copy of my Essays with my children, that my posterity may know that in 1780 there was, at least, one citizen of Philadelphia who was not totally distracted, and that they may have the honor and consolation of being descended from a man, who was able to keep in his senses in times of the greatest infatuation.

But all this notwithstanding, and altho’ appearances are strong against me, I will still hope that there yet is a judicious majority on my side, who are thoroughly sick of all visionary projects, and wish to adopt the substantial and sure remedies which still remain in our power. With such as these I will most cheerfully join in company, and sit down with them with great pleasure, and unite in farther consultation on the important subject, begging this favor at the same time of the rest, who do not like our employment, that they would not come into the room to interrupt us; and this they cannot think a hardship, as they certainly can lose nothing by it, for I really have not one word more to say to them.

If it is granted that the currency ought not to be appreciated up to its original value, I cannot see a shadow of reason why it should be appreciated at all, and not be fixed at its present value. The truth is always better than any thing near it, altho’ ever so near. Every shilling that it may be appreciated Edition: current; Page: [[82]] is added to the public debt, for which the public receives not the least advantage, but all the profit goes to the great hoarders of our currency; for those who have no more on hand than just the amount of their whole tax get nothing by it. There remain then but two things to be considered: 1st. What the present exchange of the currency is; and 2dly. How to fix it to that exchange or value.

I. As to the first of these there is a difficulty, principally arising from this, viz. that the exchange is not the same in all the States, but different in the different States, and this difference is not fixed in the different States, but sometimes varies in the several parts of the same State. But it is here to be observed, that the exchange of the several parts of the State differs very little from that which prevails in the great capitals nearest to them, and what little variation there is, most generally appears to lie in this, viz. that the exchange rises first in the great capitals, and the out towns, of less trade, follow pretty quickly after them; so that the exchange of each State may be pretty safely taken from that of its capital, or the great capital to which it is most contiguous.

The rule by which I find the true exchange at any given time is, to take the exchange which prevailed at the given time in each State, and add them all together and divide the sum by 13, and the quotient will be the mean exchange or value of the currency. For instance, by the best advice I can collect, the exchange last Christmas, or December 25, 1779, was, in the four New-England States, New-York, North and South Carolina, and Georgia, i. e. in eight States, at 35 for 1, and in New-Jersey, Pennsylvania, Delaware, Maryland, and Virginia, i. e. in five States, at 40 for 1, their sums will stand thus,—

8 into 35 is 280
And 5 into 40 is 200
Sum, 480

which sum divided by 13 gives a quotient of 3612/13 or 37 nearly, which I suppose to be the true mean exchange or Edition: current; Page: [[83]] averaged value of the currency, through all the Thirteen States, at that time.

The present exchange in this city is 45 to 1, and the exchange was rising both to the eastward and southward when the last advices came away, so that I suppose the present mean exchange may safely and truly be fixed at 40 for 1, but our future advices will soon determine this beyond all doubt. This is throwing aside all theory and speculation, and grounding my computation entirely on fact, and is a method which I expect will be allowed to be fair, true, and unexceptionable; and at this value I propose that the currency should be fixed at present, and be finally redeemed at the same. Both these I conceive very just and practicable.

I do not think there is any justice in taxing the public to appreciate any man’s money in his chest beyond the present value. This would be burdening the public, merely for the benefit of a few individuals of monied men; for I before observed that no person could take benefit of such an appreciation, but such as have more money on hand than all their taxes for redeeming the whole currency will amount to; and those few among us who have such a surplus of money are the men who have the least occasion of assistance from the public, and in general have the least right to expect or even to wish it. For a further consideration of this I refer back to all the reasons I have given against an appreciation.

On the other hand, it will be readily granted that every principle of justice requires that any further depreciation of our currency should, if possible, be prevented. The practicability of both these, i. e. of fixing the currency, deserves our most serious consideration; and here, notwithstanding the unaccountable and seemingly capricious fluctuation of the exchange, both in progressive and retrograde motion (for we have frequently seen both) yet I say, this notwithstanding, I do contend there are great natural principles, which, if properly applied, will confine this slippery subject, six it to a point, and prevent such fluctuation as will greatly prejudice its use.—To prevent an Appreciation,

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I. As the currency has no real fixed value in itself, it is necessary that it should be connected, tied, or fastened firmly to something that is fixed, which may hold it steady, as an anchor does a ship, which keeps its place by that connection, let the wind or tide set either way. Such a fixed medium is hard money, the value of which cannot vary much from its value in Europe, and therefore its permanency may be safely depended on. To this end I propose,

1. That an order of Congress be passed, that hard money shall be received for taxes and all other payments into the Continental Treasury, at the present value or fixed exchange; say 40 for 1. For as the demand for taxes will be very great and universal; if the present system of taxation be carried into effectual execution, as it doubtless will be, it will not be possible for any man to get a better exchange than is received in the public treasury.

2. I propose that a resolution pass to redeem the whole currency finally at the present value; say 40 for 1. This will effectually take away all inducement to raise the value of it beyond the exchange which can finally be obtained for it, when it shall be redeemed. I do apprehend that my reasons before assigned against the appreciation will prove the justice, good policy, and necessity of these resolutions, to which I therefore refer.

3. I propose that all public estimates, quotas, payments, &c. be made in hard money, or Continental equal to it at the current exchange, and also that all judgments of courts, fees, salaries, &c. should be made up in the same manner, that so no public community or private person should receive either injury or benefit from any future fluctuation of the currency, either up or down, if such should happen, any farther than his cash on hand might be affected by it. This would not only be an effectual remedy of the crying injustice, both public and private, which has too long prevailed among us, but will also take away the principal inducement and temptation to attempt any fluctuation of the currency.

4. I propose, for the more effectual operation of this remedy, that all the tender acts, all laws against dealing in hard money, and every other of that nature which now subsist Edition: current; Page: [[85]] in any of the States, may be repealed. As those acts were mostly made on the recommendation of Congress, I apprehend a recommendation of that honorable body to the several States for such repeal might be necessary.—It appears to me that these propositions will most effectually prevent any future appreciation of our currency.

But it may be said here, we are sufficiently out of danger of that, the present labor is stop the depreciation. But I do not know all this. I have many reasons to fear an appreciation, which would be a very ruinous calamity if it should happen, and I think we may do well to use precautions against a possible evil; and I have at least the common argument of quacks in favor of my propositions, “that they are innocent, they can do no hurt, and they may do good.” If the event to which they are designed to be applied should happen, they will be of the utmost use and benefit; if that event should not happen, their operation will be prevented, and no bad effects can proceed from them. I am as sensible as any man of the urgent necessity of preventing a farther depreciation, and therefore recur to such great natural principles as I think will most effectually and assuredly remedy the mischief; and here I hope it will not be taken amiss, if I repeat some things I have heretofore advanced; for great truths, and weighty principles of decisive importance, ought often to be repeated, that they may be better kept in mind. I proceed then, to prevent Depreciation,

II. To observe, that one great cause of depreciation is the increase of the quantity of our currency, and therefore the quantity must by no means be increased. For it is not possible to prevent the operation of such increase on the depreciation. It matters not in what shape such an increase may appear, whether of Continental bills, certificates, bills on Europe, or bills of particular States. If the quantity in circulation is increased, it is not in the nature of the thing possible to prevent the effect of depreciation, which must and will flow from that increase. Therefore, the incomes must be made equal to the expenditures. This will give the currency a quick circulation, sufficient for every purpose, without any increase of Edition: current; Page: [[86]] its quantity, will raise that demand for it, which is essential to its nature and use, and from its natural operation will prevent any possibility of depreciation, if the confidence of the public in its final redemption can be made entire and free of doubt.

And this brings me to the consideration of another great principle, on which the credit of all bills must depend, viz. the final redemption of the bills must be made certain, and the value or exchange at which they shall be finally paid or redeemed must be certainly known. If there is any doubt of either of these in the minds of the people, that doubt will lessen the value of the bills; for a certainty will always be better than an uncertainty, i. e. the credit of the States must stand so firmly connected with their real substance, that there can be no doubt but the one will be supported by the other. The life and use of money lies in a quick and ready circulation; yet, although this circulation should be ever so brisk, if it passes from hand to hand, like Robin’s alive, in constant danger of dying in the last hand, it must, notwithstanding all its signs of life and vigor, depreciate fast; and I conceive a general confidence or doubt of this kind has operated more on our currency than people are generally aware of.

In the gloomy aspect of our affairs in the winter of 1778, when the British army had possession of Philadelphia, the exchange rose to 6, 7, and 8 for 1. In the summer and fall of the same year, when we began to feel the great effects of General Gates’s success, the English sued for peace and their army left Philadelphia, our alliance with France was formed, with a prospect of the accession of Spain, and a powerful French fleet was on our coast, the exchange fell to 4 for 1, and kept down for many months together.

But when our sanguine expectations began to abate, new difficulties arose, and the multiplied emissions had swelled the quantity of our currency to an enormous amount, beyond any probability or even possibility of payment at full value, there ensued a great abatement of the general confidence, and mighty doubts arose whether it would ever be redeemed at all, or, if it was, at what value; and these doubts increased with the increase of the quantity, and some other Edition: current; Page: [[87]] causes, till the exchange rose up to the enormous height which now exists. The principal causes of these doubts, and consequently of the depreciation, I take it, have been the uncertainty of the fate of the war, or support of our Independence, and the increasing enormous sum of our currency. I conceive all doubts arising from the first of these causes are pretty well done away.

I think it is so far from remaining a doubt whether we shall support our Independence, that I do not apprehend it is in our power to give it up if we were willing, and to fall back into the dominion of Great-Britain. I am of opinion that France and Spain, and perhaps some other powers, must be conquered, before the trade or government of America can be permitted to be monopolized and controlled by Great-Britain. The vast extent of our country, the fertility of our soil, salubrity of our climates, with other natural advantages, together with the rapid increase of our people, agriculture, and arts, make us an object of vast importance, expectation, and attention with every trading country of Europe, and they will not easily give up the share of profit which they expect to derive from us.

If we continue to increase as we have done in time past, that is, to double every 25 years, the Thirteen States will contain more people at the end of the next century, than France, Spain, and Great-Britain together all contain at present. All Europe gaze with attention on our rising greatness, and it is a pity that America, like some careless beauty, should be the only person in the company, insensible of her charms. It is time for us to know our own importance, and not throw ourselves away in a needless despondency.

As to the doubts arising from the great quantity of our currency, and the consequent uncertainty of its redemption, I conceive they will be effectually removed by the foregoing propositions. The present debt of Continental money ceases to appear enormous; it does not exceed 5,000,000 of hard dollars, which is less than 2 dollars per head on the inhabitants; a light burden! a trifle! not adequate to the abilities of the poorest town in the Thirteen States. The only remaining doubt is, whether the States will in fact Edition: current; Page: [[88]] pay this sum, small as it is. This doubt appears to me ridiculous; for were we to suppose there was not a grain of honor or honesty left in the Thirteen States, on which we could depend for the payment of their debts, yet they have suffered so much by the depreciation of their currency, that they will, from a principle of self-preservation, remedy the mischief, and prevent it in future. A burnt child dreads the fire, and certainly we have not lost all the feelings of human nature, however callous we may be to the inducements of moral principles.

But my confidence, even in the morality of the States, is not shaken, it is entire. It is my opinion our people are able and willing to do all that is necessary to be done in the present crisis. Nothing more is or can be necessary, than to put the matter in a proper train of operation.

Let the people see the expenditures made with prudence and economy; that the demand of public money is grounded on public necessity only; let them see men acting in the offices, through which the public monies are to pass, in whom they can have confidence; let them see a system of finance formed, which shall appear both practicable and sufficient, and put under such direction as shall afford a good probability of prudent management and effectual execution; let these things be done (and I do not take them to be mountains impracticable) and I conceive our public faith will be effectually restored, and rise to such a degree of respectability, that no branch of the revenue will dare to defraud the treasury, or withhold the supplies necessary to the public safety; nor, on the other hand, will our public faith prove a ruinous and infamous trap to those who have trusted their fortunes to its security.

I do not pretend these are light matters and without difficulty. The forming a system of finance is an arduous work, fully equal to the abilities of a person of the strongest intellects, steady attention, and aptitude to the subject. It must be the work of one mind, capable of the necessary attention to all the parts, and able so to comprehend and arrange the whole, as to form a system both practicable and sufficient. I do not think any aggregate body of men on earth able to do Edition: current; Page: [[89]] this. I am of opinion, that we might as well expect that a General Assembly, a Parliament, a Diet of an Empire, or a Congress, could describe and demonstrate the properties of the sphere, compute the force of falling bodies, define the laws of hydrostatics, or make an almanac, as form a system of finance.

The power of superintendence and legal sanction is theirs; but the calculation and execution of the system is not, in my humble opinion, compatible to the senatorial body. The British Parliament, some years ago, abolished the Julian style, and adopted the Gregorian, and gave it legal sanction, to the great satisfaction and benefit of the kingdom; but I never heard any man suppose that that Parliament was ever capable of calculating or demonstrating either of the styles; yet I do not apprehend that it is any reflection on the dignity, abilities, or competency of that Parliament to suppose, that, if nobody could have calculated styles better than they could, we might have done without any till this time, and computed the advance of the spring by the budding of white-oak trees, as the Indians do.

The consequence from all this is, in my opinion, that if a senatorial body want styles, systems of finance, or any things else which require peculiar abilities, such as by common probability cannot be presumed to exist in such a body, they can only manifest their wisdom and employ their authority in appointing men of proper abilities to make them; then the Senate can examine and correct them, and add their sanction and authority, put the execution of them under a proper direction, and keep the superintendence only in themselves. I think it may easily appear, that the nature of the subject limits the powers of a Senate to this line of conduct.

But were it not so, good policy would prescribe this method; for the ground of finance is, every step of it, most dangerous ground. Errors are at first imperceptible and easily made, but soon shoot up into capital importance, and often assume a most hideous and ghastly appearance; all which is apt to throw disgrace and censure, and sometimes contempt, on the authors. That which proceeded from Edition: current; Page: [[90]] ignorance may be attributed to bad design. In any view mistakes and disappointments prove the ignorance or imperfection of the managers, and there will always be some degree of contempt due to persons who undertake things which they know not how to perform.

Bodies of supreme dignity ought never to incur censures or aspersions of this sort. The public always suffer, when the wisdom or integrity of their supreme power is called at all into question. They ought, therefore, in all good policy, to appoint proper persons to do all business of this sort, were it only that they might have a scape-goat to bear away from themselves the censure, disgrace, and contempt which any errors might occasion, when they came to be discovered; for it is very observable, that when any error or misconduct happens in any great department of the State, the blame always falls on the officer under whose direction it was made. No part of the censure ever falls on the supreme power, unless it is that of making a corrupt or injudicious appointment of the officer, or taking the management of the matter out of his hands by too particular instructions.

On the whole matter, our country abounds with men and every sort of supplies which we need (military stores and clothing excepted, which are easily attainable from abroad). Our public counsels and measures are very little obstructed by disputes or parties in opposition. The great thing wanted is, to put our finances into such a train, order, or system, as will revive the public credit, bring our currency into such an established value and demand, as is necessary to its nature and use, and enable the public to call into use such services and supplies as are necessary to the public safety.

The abilities requisite to form and execute such a system are not to be found or expected in any senatorial body; i. e. by common probability it cannot be presumed, that the component members of such a body should be possessed of the rare and peculiar abilities requisite for this great purpose.

It remains then a matter of the highest and most urgent necessity, that a suitable person for the great office of Financier-General, or Superintendent of Finance, should be Edition: current; Page: [[91]] looked up, and appointed as soon as may be, whose sole business should be to inspect and control our whole revenue and expenditures, and keep them in balance with each other.

I imagine this high office will not be very greedily sought or eagerly accepted by any person capable of it. It will require the most unwearied, unremitted application, the most intense and fixed attention to a subject of a most intricate nature and great extent; the heart-felt interests, the loss or gain, the injury or benefit of millions, will stand closely connected with his conclusions and management, and of course his errors, if he makes any (as from the intricacy and vast extent of the subject he undoubtedly must) his errors, I say, will incur the severe resentment, and raise the merciless cry of the inconsiderate and ill-natured, which make a considerable part of the world; and after all, if he conducts with success, he will get little praise; for every thing in his way will go smoothly on in a regular train, which will soon grow familiar, and of course unnoticed, and not one in a thousand will know to whom they are indebted for their tranquillity.

Besides, I do not know that the present confusions of our revenue are capable of being speedily reduced to order by any address of wisdom, skill, and diligence; and should he fail, the weighty burden might crush him in an instant, and he may fall, like Phaëton, ridiculous and unpitied, for undertaking a work for which, perhaps any degree of human wisdom or ability may prove insufficient. Be this as it may, much will depend on the choice of this officer. Should an insufficient man be appointed, his defects or mismanagement will not only be severely felt while he is in office, but most probably his successor may find a more difficult task to correct his errors, than to have taken up the matter new, and set out right at first.

But to return to the main point; the great question seems now to be, whether, in any practicable train or method, it would be possible to raise money among ourselves equal to the necessary expenditures, i. e. whether the people could pay such a large sum. To this I answer, the best method of judging of the mighty wealth and abilities of the States is, by reflecting Edition: current; Page: [[92]] on what they have paid in times past. The expenses of the war for 5 years past have been about 11,000,000 of hard dollars per annum, besides the loans, as will easily appear by computing the value of the bills emitted each year; and this has been all paid, except 5,000,000, and that in the worst, most distressing and oppressive method that could be devised, viz. by the depreciation of the currency.

The payments of the last year, 1779, which were actually made, were much more than the said sum, for on the last day of the year 1778, the whole currency was somewhat more than 90,000,000, and the exchange was 6 to 1; consequently, 90,000,000, divided by 6, will give in hard money the amount of our debt of continental money, viz. 15,000,000 of hard dollars, to which add the expenditures of the year 1779, viz. about 140,000,000 of dollars,* which is somewhat less than was emitted in that year. To find the value of this, we must divide it by the mean exchange of the year, which I conceive may be found by multiplying the exchange at the end of the year 1778, viz. 6 for 1, by the exchange at the end of the year 1779, viz. 40, which makes a product of 240, the square-root of which, viz. 15½, nearly, is the mean exchange, and the sum of expenditures of 1779, viz. 140,000,000, divided by said mean exchange. viz. 15½, gives for quotient 9,000,000 of hard dollars, which, added to the amount of the debt at the end of the year 1778, viz. 15,000,000, makes somewhat Edition: current; Page: [[93]] more than 24,000,000; out of which subtract the debt now remaining, viz. 5,000,000, there remain 19,000,000 of hard dollars, which have been actually paid by the Thirteen States in the year 1779.*

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The question is then reduced to this, viz. Whether it is not only possible, but much easier to pay 11,000,000 of hard dollars in some equitable mode, which distributes the burden on all in due proportion to their abilities, than it was last year to pay almost double that sum in the most unequal and oppressive way imaginable. I know it will require strong exertions, but we began the war with this expectation and resolution, and I do not think our people will shrink or give back under the burden when it comes.

Besides, it does not appear to me possible to increase our circulating cash in any way, without further depreciating it, which at once destroys its use, and the very end we should have in view by increasing it. Loans will do this; for every loan makes a new certificate or bill of some sort, and all these will flow into circulation as soon as they gain that established value which they ought to have, and which they must have, before we can borrow without a loss or discount.

I think it manifestly reasonable, that all loan-office certificates should be redeemed at the exchange which existed at their dates, and that there should be a rate of exchange from the first depreciation down to the present time made, to ascertain the exchange at the time when each bill was dated, and a sure interest, in proportion to the value of the principal, should be secured to the possessor, until the certificate shall be paid. If this was done, we might borrow, perhaps, without a discount or loss, and keep our debt at home, which would be much better than drawing bills on Europe at a loss of 30 or 40 per cent. and contracting a hard money debt abroad. But this is digression. To return to my subject.

I do not really see but that general and heavy taxes are most absolutely necessary to give demand to our currency, animate the industry of our people, and banish idleness, speculation, and a thousand visionary projects, which prevail to Edition: current; Page: [[95]] an alarming degree, and which must vanish into nothing soon, and therefore the sooner the better. Taxes will increase the circulation of our currency, which will increase its use quite up to the full amount necessary to all our needs, nor can I see any other way in which we can carry on the war, without incurring such an enormous debt at the end of it, as will mix the very joys of established liberty with bitterness, and even endanger that very liberty itself, for which we have so strenuously contended, and for which the debt itself was contracted. The writer of three letters on appreciation, has advised us to set the presses a going again, and in the plenitude of calculation made out that the depreciation or exchange, at the end of the year 1780, would in that case be about 68 to 1; but had he founded his calculation on fact (on the supposition that the depreciation would be no greater this year than it was last, which is not true) he would have found the depreciation or exchange, at the end of the year 1780, at least 260 to 1, and probably it would be more than double, perhaps the treble of that exchange, if it should continue to pass at all thro’ the year, which is far from a certainty. This method then will not do.*

From all which it appears pretty plain we have but two things before us, viz. to raise as much money as will be sufficient to pay our expenditures as we go; or, if we cannot do this, to reduce our expenditures to the sum which we can pay. For to talk of keeping up a greater expense than we can pay any how, is absurd and ridiculous to a very contemptible degree. To borrow abroad is ruinous, and nothing is plainer than that we cannot hold it out long in this way; and what is worse, our enemies must know this, and thereby be encouraged to continue the war against us. Edition: current; Page: [[96]] To borrow at home destroys the very end and use of the loan as it goes. The great purpose cannot be served in this way. What we can raise among ourselves is all that we can pay, and we cannot attempt expenditures beyond this without bankruptcy.

A peace cannot be expected till the end of the great contest between three of the greatest powers of Europe, which may involve more powers in the dispute. It is a matter of such high point of honor, pride, and interest with them all, especially Great-Britain, that they will strain the last nerve for superiority before they will yield an ace, and the war may last many years; the consequence of all this is, that we must take up the matter as we can hold out.

A man who has a long race before him is mad, if he exhausts all his strength in the first mile. A certain degree of exertion we are capable of, beyond which we cannot go; within this we must keep and confine ourselves. This degree ought to be calculated with great judgment, and used with great economy, and with the most effect it will bear, but it cannot be exceeded without the mighty and tremendous danger of final ruin.

These are my best thoughts, the subject is too vast, too unexplored for my comprehension. This is my fourth address to the public on this weighty theme. I am obliged for the favorable reception of the other three, hope the same candor will be extended to this. My thoughts are free, the nature and incidents of the subject dictate my argument. Great natural principles will always make their own way in the end; and if they are ever rejected, it is because they are not rightly apprehended, and any departure from them will be checked and reformed by dear experience.

My close attention to this great and intricate subject has taught me that it baffles all speculative theory and calculation. The only safe basis of every principle of reasoning on it must be fact or experiment. Here I drop my pen, ready to stand corrected by the better thoughts and more useful discoveries of any superior genius.

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A FIFTH ESSAY ON Free Trade and Finance.
First published in Philadelphia, March 30, 1780.

THE expenditures of the present year 1780, are estimated (as I am told) at about 10,000,000 of dollars hard money. This sum must be raised and paid, or our defence must be discontinued; we must lose our liberties and probably many of our heads too; our struggles must vanish into smoke and disgrace; and our glorious revolution must be dubbed rebellion, and punished as such, and how much more God knows. The said sum must be raised, or these miseries must ensue. We have no other alternative, and it is vain and idle to amuse ourselves with any hopes or even shadows of any other. Our defence cannot be continued without the necessary money; if that ceases, we instantly lie open to the full power of our enemies, and must submit to any conditions they may prescribe.

This I take to be the plain state of the facts; stubborn facts, which can neither be removed, eluded, or softened, by any possible finesse, coloring, or evasions. We may as well keep them in sight as to shut our eyes against them; for facts they are, and will have their operation, which we must feel, whether we will see them or not. If the expenditures, on which the estimates are made, can be reduced, doubtless Edition: current; Page: [[98]] every possible attention will be paid to such an object, but we cannot flatter ourselves that any very considerable savings can be made in this way; it only remains then that we set ourselves immediately to raise the money, or give up the cause in despair. I say immediately, for it will soon be too late; every department will be so involved in debt, and the difficulties, disappointments, and confusions thence arising will multiply so fast, that no remedy can be admitted.*

In a crisis of danger, when the most spirited and resolute efforts are called for, to see men like children stand with one hand in their eyes, and the other in their mouths, blubbering out with voices half assured, I cannot! I cannot! I dare not! I dare not! is ridiculous, argues such meanness of spirit, such heartless cowardice, I am ashamed of it. If I really thought the people of America capable of this, I would not move a finger to save them from that slavery and subjection for which they must, in that case, be so well fitted by nature; it would not move my pity to see them lashed by their masters into that severity of effort, which their cowardly souls had not animation enough to exert in defence of their own liberties.

The very taxes which we now hesitate to impose on ourselves to defend and secure our liberties, will, I dare say, Edition: current; Page: [[99]] be imposed and rigidly extorted by our enemies, whenever they shall get their yoke on our necks: the price which they will make us pay for our chains, will be greater than that which is now necessary to pay for our liberty: the temporary burdens which are now demanded to secure the well-being of ourselves and posterity, will be made perpetual on us and them by our enemies, when they shall find it necessary to secure our slavery and their luxury: for did any man ever know or read the history of any country, governed as an appendage of a distant empire, that was not fleeced, if not skinned and peeled to the bone, by their distant, unfeeling, unsympathizing despots. Such countries are never, in such case, estimated by any other scale, than the amount of the revenue and other advantages that can be drawn from them.

I do not really think that the people of the United States are at all the proper subjects of this kind of government; I do not think a meanness of spirit, a gross stupidity, or cowardly diffidence makes any part of their character; they have, in fact, resented injuries, asserted their liberties, and nobly dared to defend them, with a degree of exertion, perseverance, and firmness, unparalleled and almost beyond belief. It is my opinion that we may safely depend on any degree of exertion and spirit in our people, which is necessary to their safety; and if this is not all called out and put in force, when and to any degree the public safety may require it, the fault will lie in the rulers, not in the people.

Indeed I am of opinion, there are few instances of any countries over-run or enslaved, thro’ any defect of virtue in the people, which does not originate in their rulers; the natural and common source of remedies lies in the rulers, and if they are good, they will see the mischief, and apply the remedy, before it rises to such force as to endanger the liberties of a country. If vice or corruption gets ground in any popular state, it generally discovers itself pretty early in the appointment of officers of notorious improper character, or insufficient abilities, to fill and manage the important departments of the state; for where any corruption Edition: current; Page: [[100]] or prejudice prevails in any state, they will generally endeavour to get into place, such officers as are likely to support such corruption or prejudice.

In this case, the mischief is carried into the very source of remedy, and corruption gets a whip-row, which gains by every movement; and if this whip-row cannot be broken, the game must soon be up, and there remains nothing to do, but to set again, and try a new game. But as all that is not our case, this may be deemed a needless digression: we will come then directly to what is our case, which I will here endeavour to state as it stands in fact, which no fretting, or jesting, or shrugging can alter.

I. The estimates of the present year amount to about 10,000,000 of hard dollars, or the value of them, which must be paid by somebody, or our defence cannot be continued, If this ceases, our country must lie open to the unrestrained ravages and plunders of our enemies, and every obnoxious individual be exposed to their vengeance, and we have seen enough of them to know that their tender mercies are cruelty. And the only question I conceive that can arise here is this, Whether this heavy burden shall be laid on a part only of our people, and crush them into ruin; or whether it shall be laid equably on all? In the latter case, heavy as it is, it may be borne; it will not amount to more than 4 dollars on each person, or 20 dollars on a middling family of 5 persons. If there is a beggar in the Thirteen States who cannot pay this, he must have some rich neighbours who can pay it for him; and it lies with each State to apportion their taxes in such manner as to ease the poor, and increase the share of the rich, so as to bring the burden on all in due proportion to their abilities.

If, instead of this, the whole weight must lie on a few, viz. such as happen to have the supplies necessary for public use; if the wheat, hay, &c. must be torn from the farmer; the rum, salt, &c. from the merchant; the services of the soldiers, waggoners, &c. be compelled by force; if in this way our supplies and services are to be extorted from a few, whilst the rest bear nothing, the community Edition: current; Page: [[101]] must suffer much more than it would do, were the burden equally proportioned on all.

For to say nothing about the execrable injustice and wickedness of this method, the resentment and rage it will excite, the discouragement to the future industry of the farmer, or adventure of the merchant, the reluctant recruits of the army, hereby occasioned; to say nothing of these, it is as manifest that a heavy burden may be borne by a whole community with more convenience than the same can be borne by a part only; as that a large beam of timber can be borne by 20 men, each bearing in proportion to his strength, better than by 10 only who are crushed by the weight, whilst the other 10 bear nothing, or perhaps some of them hang on and increase the weight. The 10 who are crushed and overstrained will be rendered unfit to bear any burden in future time, and of course their future services will be lost to the community; whereas if the whole 20 bore each his due proportion, it might be a heavy lift indeed, but none of them would be overstrained, and they would all be fit for future service.

II. Our currency is in such a feeble and fluctuating state, that the ends and uses of it are much decayed, and in a manner lost; it ceases to be a certain security to the possessor of any determinate value, and of course cannot be a common measure of value for other things; so that it becomes impossible to calculate or carry on our private business or public operations with this medium, and of course both must cease, or be greatly impaired by this mischief.

This may be easily and speedily remedied by taxes; for if every bill of our currency was a Turkish turban, we might easily set any price on it we pleased, and make the demand quick at that price, in this way; for was an adequate tax made, and speedily and rigidly pressed, obliging every man to pay a turban or 10 dollars into the public treasury, it is manifest the price of a turban would immediately be 10 dollars, and the demand quick at that price. For the same reason, we may raise the value and demand for our currency to any pitch or degree we please, in the same way, viz. by making a tax for any sufficient sum of Edition: current; Page: [[102]] continental dollars, or the value in hard money, at any exchange we please to fix. This would immediately raise the continental money up to that exchange, if the tax was large enough, and sufficiently pressed.

Indeed we manifestly have it in our power to increase the demand and value of our currency to a much higher degree in this way, than either the fixing the currency or the public exigencies require. This is a matter that requires great judgment and nicety of observation. Some may think there may be danger of oppression here; but I answer there is neither danger nor possibility of oppression, if the exchange is not fixed higher or lower than the current exchange or real present value, nor more money required than is necessary for the public use, and the States apportion the tax on their people properly according to their several abilities; all which ought to be very carefully attended to; and if any part is not done right, the fault will lie on those that do it, but not at all on the principle here advanced.

But before we quit this idea, I beg leave to add one observation more here, viz. every honest individual, I conceive, loses more in a year by the present fluctuating state of our currency, and the present mode of procuring the public supplies, than his whole tax would amount to; he loses his business on which the support of himself and family depends, and must live on his dead stock, or at least is subjected to most material disadvantage and discouragement; for I submit it to every man to judge, whether any man, either in the occupation of husbandry, mechanic arts, or merchandise, can compute his business in such a manner, as to make it safe to put his whole stock in action in any of these ways, while he has no reasonable assurance what the produce of his diligence may be, or whether he may have the selling his produce, fabrics, or merchandise, when he has procured them.

The occupations of life are of such great importance to every man, that it is manifest that even small embarrassments in them, involve a damage much greater than any man’s tax would be to the whole expenditures of the war. Edition: current; Page: [[103]] This opens to our view another actual circumstance, another fact, which is too obvious to be overlooked, and too serious and interesting to be neglected, viz.

III. The whole sources of our supplies are dying away fast, are lessening to an alarming degree, and threaten not a mere scarcity, but universal famine, want, and deficiency in a short time. Most people are lessening the business of their several occupations down to a pitch just sufficient for their present occasions and necessities, and many have wholly thrown up their occupations, and live on their dead stock, and very few are calculating their business on any large scale. I submit the truth of this to common observation. The present great demand for merchandise, fabrics, and the farmers’ produce, which would be the sharpest spur of industry, were our public counsels wise, and our currency good, now becomes the terror of the possessors, and induces them to hide and conceal their effects, instead of exposing them in open market: our public acts (for taking supplies by force) demonstrate this, for such acts are always supposed to be suited to the circumstances of the times.

This is a direct and manifest consequence of the numberless instances of force and fraud which have been practised to rob and cheat the possessors out of their goods. These methods are in every view mad, wicked, and absurd; mad in those who do not see the consequences of them; wicked in those who do see them; and absurd in both, because by their natural operation they soon defeat and destroy the very ends for which they are adopted, viz. mending the currency, and procuring supplies.

The great Creator has not given to all men equal discernment; some politicians are short-sighted, and cannot see the distant ill consequences of measures which yield a present advantage, but he must be a stupid blockhead who cannot see such effects when they stare him in the face, and stand in full fact before his eyes.

The proper remedy of these terrible mischiefs is to lay the public burden equally on all by taxes; this is easier, more reasonable, and more safe for the community, than to suffer it to rest upon a few. The burden must be borne Edition: current; Page: [[104]] by the community in some way; the supplies and services cannot be procured for nothing; we have too lately tried it out and out, and have full proof that something cannot be paid for with nothing, and therefore if something is to be paid for, it is vain and ridiculous to be casting about, and starting and chasing one visionary project after another, of new emissions and better emissions, of loans foreign and domestic, &c. We must recur to solid wealth to pay for all our solid supplies. The nature of the subject will drive us to this at last, and the longer we put it off, the longer our miseries will increase; and God grant that we may not put it off till all remedy is desperate.

We must at last have recourse to the solid wealth of the States, and every individual must be called on for his share. In this there can be no reason of complaint; the cry of oppression will cease; that demand will be given to our currency which is essential to its nature and use; and every possessor of supplies will hasten to offer them: this will stimulate the industry of men of all occupations, and fill our country with virtue and plenty. But it may be objected here,

1. That our old currency is got so much out of repute, that it cannot be reformed, but may be called in, and replaced with a new and better one. I answer, all that ails the old currency is, that it is not, it carries not in it, a sufficient certain security of any determinate value to the possessor; and this same thing will all the new currency or any currency we can make, unless we can mend the public faith on which it depends, and connect it so manifestly and firmly with the real wealth of the States, that the security may be undoubted. It is impossible this can be done by any thing but payment, either present or so secured, that there will remain no doubt in the mind of the possessor that it will be bona fide made. If this can be done, there is no doubt but we may make our currency good, yea, better than hard money, because it is sooner counted, and more easily conveyed.

There is indeed one reason for calling in the old currency, and issuing a new one, which appears to me to have real and great weight, viz. Many of the bills of the present Edition: current; Page: [[105]] currency are counterfeited, and it is very necessary the public should be freed from these impositions; and to this another may be added, viz. It would be very desirable to have a currency which should express the true value of the bills in the face of them. The present bills carry but a fortieth part of the value expressed in their face; and this holds out the feeble, enervated, and debilitated state of our public credit in so glaring a light, and publishes our shame and distress so very undeniably and universally, that I should be willing to have them out of sight; as people generally endeavour to keep out of view, brands and marks which indicate the disgrace of their families.

Besides, there is a sort of deception in the bills, which I conceive to be hurtful; when a man gets a great bundle of them, he is apt to be cheated in spite of the convictions of his own heart, into an opinion that he is richer than he is, and of course to abate a little of that economy which he would think necessary if his mind was not dilated by that delusion; whilst, on the other hand, the taxes appear more heavy and terrible when heightened under the enormous denomination of the currency, than they would do were they offered and demanded in a shape that corresponded to their real value.

These may perhaps by general consent be allowed good reasons for calling in the present bills and issuing new ones, and this may be well enough, if the mode and regulations of the measure are limited to its uses.

But the substance is yet wanting, every thing necessary to give fixture to the currency is still to be done, and all remains to be done, and will remain so, till we can fix the funds of our currency so sure as to make it a certain security of real value to the possessor, and call it in so fast by taxes as to limit its quantity within the uses of circulation, and prevent its increasing to such amount as to render the final redemption difficult, improbable, or uncertain. This is the grand gist of the whole matter; this will effectually save us; less than this will not; all the rest is but shifting the weights in the scale, without adding a single ounce to help a balance or preponderation; this therefore is our great object, from Edition: current; Page: [[106]] which our attention must not be diverted, no, not for a moment; on this our fate depends.

2. It may be further objected, that no nation of Europe can carry on a war without loans, or some way anticipating their revenue, and running in debt, and how can it be supposed that we can do it otherwise? I answer, their case differs from ours very materially.

1. They have credit to borrow on, which we have not, unless we allow such a ruinous discount as makes our affairs desperate, and must soon put it out of our power to preserve our liberty.

2. Our country is richer, more full of men and stores necessary in war, than those of Europe in general, and of course the carrying on the war without running in debt is more practicable by us, than by them.

3. They have such sure and established systems of finance fixed and settled, on which they can issue internal bills, as furnish a certain security to the possessor, of payment; their treasuries are the safest repositories of their nation’s wealth; we have not these advantages, our treasury has hitherto proved the destruction of the wealth that has been trusted to it, and of course every body is afraid of it, and therefore loaning at home to any great amount is impracticable, and what cannot be done need not be urged as politic, eligible or salutary.

4. If any nation of Europe borrows specie, and thereby increases and of course depreciates their cash but 2 or 3 per cent. that discount is enough to spread it all over Europe, by which the balance is soon restored, and the depreciation is checked; or if any nation, as Spain, imports money from Peru, and makes it over plenty and of reduced value, it spreads over Europe directly; and so by covering a larger surface the depreciation becomes insensible, and the inconvenience little felt: but this is not the case with us; our currency cannot be exported, were it ever so good, therefore, any increase of quantity must have its full effect by way of depreciation among ourselves; and of course any increase of the quantity destroys at once the very end and use of such increase, as the value cannot be thereby increased, Edition: current; Page: [[107]] but instead of this, the whole deluge of mischiefs arising from a fluctuating currency must flow in upon us.

5. The very operation of this method of loaning, and anticipating of the revenue, adopted and practised by the nations of Europe, is in itself enough, were it ever so practicable by us, to deter us from following so fatal an example. See Great-Britain enervated and benumbed under the pressure of an enormous debt, the very interest of which consumes the best part of the richest revenue which the wealth, industry, and oppression of the nation can produce. How disheartening must it be for that people to struggle thro’ the year merely to pay a corroding interest, which brings them not the nearer to the end of their misery, but only keeps alive that gnawing vulture that must for ever feed on their very entrails. I cannot but wonder that any man in his senses should hold up such a sad spectacle for an example to the Americans.

6. The nations of Europe never attempt to borrow money, till they have first raised all the revenue they can within themselves, and find it not sufficient; but this is so far from our case, that we have never yet taxed half enough to drain off that surplusage of money which the war has occasioned, and our capital distresses and difficulties have all along arisen from that flood of money which made it too plenty for use; even hard money will buy little more than half so much country produce as it would purchase before the war.

This mischief cannot be remedied by increase of the quantity, by loans or any other way, but must in its nature be checked by draining off and lessening that quantity, and thereby raising the demand for it which is essential to its use. From all this it appears to be weak and silly as well as absurd, to urge for our imitation the example of other nations, the very convenience, necessity, or even practicability of which depends on circumstances which do not apply at all to our case.

It is not the least danger of this practice that it operates insensibly, saps and mortgages our wealth before we know it; it operates like a slow poison, which is certain death, and more painful, tho’ more slow and lingering, than the Edition: current; Page: [[108]] sudden execution of the ball or sword. Indeed I look on all insensible taxes to be highly dangerous; a fatal instance of which we have in the depreciation of our own currency. I think it necessary that the people should see and feel what they pay, should earn the money before it is spent; this would prevent a thousand stupid, foolish, and needless ways of spending the publie money; this would make the rulers careful how they adopt any expensive operations, and attentive to the strictest economy in the expenditure.

Insensible taxes are like insensible perspiration, which weakens the body, and wastes the constitution before the patient knows he is sick. Nature generally marks places of danger with signals of notice, and every mariner looks on one sunken rock as more dangerous than twenty that are above water; for this reason I think that every branch of the revenue should originate in such sensible and visible demands on the wealth of the people, that they may all feel and know what they pay, and what they pay it for; and this is, in my opinion, the surest way to keep a treasury always supplied with enough by the cheerful contributions of the people, when the public safety or convenience requires it, and to prevent more than enough being ever demanded or granted: a due attention to both these I take to be no small branch or even pillar of policy in every state. The foregoing survey of our mischiefs and remedies brings up to view another circumstance which appears to me a very plain fact, viz.

IV. Our distresses, dangers, and difficulties do not consist in a want of any thing, but in over plenty, in surplusage of cash, which is become so common and easy of acquirement, that it is slighted, it is little thought of, it is scarce an object of desire, much less of animation; our burdens are burdens of cash, that which is the wish and want of most other distressed people is our misery; like plethoric constitutions, whose stamina are all good, but are overloaded with too much blood. A sufficient bleeding, a proper draining off of this superfluous matter, would set us all right in a short time, and every part of the constitution would find case, relief, and a speedy return of life and vigor Edition: current; Page: [[109]] from the simple operation of this most obvious, natural remedy. On the whole matter, I think that one more fact offers itself to view, which were we in a less torpid state, might animate us to some spirited efforts, some lively exertions to extricate ourselves from distress and danger, viz.

V. Every circumstance conspires to demonstrate that the most sure and effectual remedies are in our own power, are very practicable, and the present time is the most suitable for the application of them that any nation in distress ever had or could wish. We are free of debt, at least of the pressures of debt; the whole public debt at home and abroad does not exceed our abilities, and may be paid in two or three years without any painful exertions. We are yet on this side of that bottomless abyss of debt, into which our enemies find themselves plunged; that insupportable but everlasting burden that presses and exhausts them in so fatal a manner, that they are become the sport of their enemies and neglect of their friends; none appears for them in this their day of distress.

This enervating, disheartening circumstance we are yet free of; our strength is our own, and in proper condition for use; we are yet to receive the fruits of our own labors; none of our crops are mortgaged or sold before they are reaped; our wealth is entire; our country abounds with most of the supplies and stores we need; we have no difficulty but in the disorders of our finances, and they are not only capable of being restored, but self-preservation will compel us to it. We are like a strong man who is obliged to labor, but the labor required is but just enough to afford that degree of exercise which is absolutely necessary to his health, and which he must practise or be sick.

The same kind and degree of exertion necessary to restore our currency, reinstate our finances, establish our credit, and animate the industry of our people, will at the same time pay our civil list, and carry on the war. Our enemies are in a declining state, under great degrees of embarrassment, and have their hands full in every quarter, and every body against them; whilst we are courted, like the rising sun, by Edition: current; Page: [[110]] every body; our alliances and connexions are of the surest and best kind, grounded on such interests as cannot deceive us; a general union prevails among ourselves; our public counsels are all dictated by the same views and ends, and if ever we differ, it is only about the means of obtaining the same end; our relief indeed requires the animated exertions of our people, but the very distress they all feel, makes them willing to put into vigorous practice, any efforts which tend to their deliverance.

Here I beg leave to call the reader’s attention to the act of Congress of the 18th of March 1780, respecting our finances, that we may, on the best examination, judge how far that important act, if duly executed, will reduce our finances into such method, and give them such establishment as the public safety requires. It is necessary that the nature, design, and use of that act should be thoroughly discussed, because the efforts for its execution will probably take their tone from the degree of conviction which generally prevails of its utility.*

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I do not pretend to be adequate to such a discussion, and shall only beg leave to make a few remarks on it; and this I am induced to do at this time, because the act is but lately published, and our people have not had time to make up their minds on it, and I conceive many persons misapprehend the real design and true construction of it.

1. I take it that the design of the act is not to be a substitute for taxes; our public credit or finances want the same support and supplies from our real substance, our material wealth, as they did before the act. If the new bills are no better supported than the old ones were, they will depreciate as fast, become as useless and more ruinous than those, as these involve us in a vast debt of interest, which those did not. The past error of our finances is clearly seen, and the deluge of mischiefs resulting from it is severely felt, and the design of this act is not to continue but prevent those mischiefs in future, not to repeat our former error, but to mend it.

2. The act contains in it a declaration or fixture of the present value or exchange of the public bills, making them redeemable at 40 for 1, or 6d. in the pound, and this on the highest reason, grounded on such rigid facts, such real change of circumstances, as render the fulfilment of the promises contained in the old bills, impracticable, injurious to the public, absurd, and useless, as I think I have fully proved in my Fourth Essay; and all clamor and exclamation on this subject is as idle and void of reason and sentiment, as a clamor against any other promise, which, however properly made at first, is become, by a change of circumstances, either impossible or highly improper to be performed, of which we have daily instances in every part of human experience.

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We are to consider the depreciation of our currency as a public calamity, like a blast, a deluge, a drought, or ravages of an enemy, which affect every man as he happens to stand in their way, and to become their object; in all these cases the mischief must lie where it lights; it is doubtless so directed by Divine Providence, that each individual receives that degree of correction from it, which is suited to his own particular case.

In point of remedy, it is vain to inquire whether this calamity arose from the public necessity, or from the fault of any individuals or boards of our policy; for could we find and punish the faulty delinquents, their heads or gibbets might hang up in terrorem, as monuments of caution to future financiers, but can avail nothing to the easement of the calamity; our duty at present, and all we can do is, to correct the mischief in time, and prevent it in future.

3. It is objected to this act, that it doubles the quantity of circulating bills, because it issues 2 dollars out for 1 that is brought in, for 10,000,000 of the new bills are equal to 400,000,000 of the old ones, at the exchange of 40 for 1, prescribed in the act itself; that this will clash with a former resolution (of Sept. 1, 1779) “that the quantity of bills should not be increased beyond 200,000,000;” will tend to a depreciation; and render the fixing the medium more difficult, if not impossible. But I beg leave to observe here, that few laws would be salutary, or even tolerable, if they were executed up to the height of their letter; and I conceive that a prudent execution of this act will obviate all the ill effects arising from the above objections.

I do not conceive it to be the design of Congress that any part of the new bills shall issue at all, if it shall be found that it cannot be done at their full value, without any depreciation; or that they shall issue any faster, or to any larger amount than can be done, without any depreciation; for I can by no means admit the supposition, that the new bills are to be issued in a depreciated state, because that very depreciation defeats their use, renders them insufficient for the procurement of supplies, and involves us over again in the miseries of a fluctuating currency, whilst we are at the Edition: current; Page: [[113]] same time loaded with a vast debt of hard money to pay the interest of them. I never doubted the integrity of Congress, and therefore cannot attribute to them such absurdity of design, even tho’ the letter of their act might admit such a ruinous and absurd construction.

They reserve, in their act, 4 tenths of the new bills for their own disposal, which they will doubtless issue in a manner safe and useful to the States; whilst the other 6 tenths are left to the discretion of the States, who have every inducement to a prudent issue of them, as each state will stand bound to redeem both principal and interest of all they shall issue.

I am further told, that the Congress have it in contemplation to appoint a Financier-General, of known gravity, judgment, and economy, to superintend this great department, who can either let out or withhold the issues in such manner as to give the bills all the effect and use their nature will admit, without overloading the public credit, or increasing the quantity so far as to lessen their demand, and, by that means, lose the whole benefit by grasping at too much. This error is so fatal and recent, and the apprehensions of the people wound up to such a pitch of alarm, that I much doubt if half the proposed quantity of the new bills can be issued without a sensible depreciation; but experience will best show this, and prudence at the time must dictate the practicable degree which may be ventured on; and it is my opinion, that no possible height of public necessity can justify exceeding such degree, because that excess is a sure way to defeat the uses of the currency, and of course to increase the public necessities, let them be ever so high before.

The exchange is a sure barometer of the public credit, as it is of the trade, and will always serve as a safe monitor and guide to our counsels of revenue. It is the vainest of all vanities to imagine that a public bill is worth a dollar when it will not bring it, or that it is worth any more than it will bring. If it shall be found on trial that any larger sum than I have supposed, or that the whole 10,000,000 can be issued without depreciation, the public may safely receive the benefit of the whole; and the addition of the Edition: current; Page: [[114]] interest, which will be received by every individual that holds the bills, will compensate for the increase of his taxes to pay it.

This matter cannot be computed on with any exactness, without knowing the whole amount of the current cash of the Thirteen States, which I have not yet seen any where ascertained. I have heretofore on a few data made a sort of loose, rough computation of it, to be about 12,000,000 of hard dollars; but I have of late been collecting documents for a more exact calculation, and on a nearer view am induced to believe the amount will rather fall short of that sum, and perhaps very considerably; and I think farther, it is very manifest that we must have a promiscuous circulation of both hard money and paper, in order to keep the exchange of them equal: but this by the bye.

4. It may be further objected to this act, that we can have no security that some necessity or other will not be urged next year to make a further addition to the emissions of circulating bills, till they will depreciate.

But in answer to this, I am clearly of opinion, Congress will not be able to issue the whole 10,000,000 already voted without a depreciation; and also, that they will not dare to issue any of it in a depreciated state; this will so manifestly and immediately ruin the use of the whole, and defeat its whole purpose, and bring on afresh the mischiefs of a fluctuating currency, that I can have no idea that any men in their senses can think of adopting it.

But if we are to suppose our wisest men capable of such idle frenzy, it is needless to reason any further about it, we may as well give up all use of our intellects, and follow where wild distraction roves, and take the fate which a concourse of whim and accident shall provide for us: but I augur better things; I am full of expectation that before our affairs come to this pass, our wisest men, both in Congress and State-Assemblies, will be convinced of one great truth, dictated by nature and our present circumstances, viz. that we must pay our expenditures as we go: and this is the only practicable method before us; this will make any scheme good, which is not wretched indeed, and without Edition: current; Page: [[115]] this, every devisable scheme is but whim, vision, and frenzy.

5. The sum of 10,000,000 is not more than the States are able to make the most sufficient and undoubted security for, if they please. But let that security be ever so good; to give it a currency, and prevent a depreciation, they must raise a demand for it by general taxes. These are recommended by Congress in their act of the 18th instant, and others foregoing; and were they put under rigid collection by all the States, we might judge whether the demand thereby raised was sufficient to give life and use to the currency; if it should not be so, it is necessary that the taxes be still increased till that effect shall appear, at which time, and not before, the grand point will be gained, viz. that of fixing our currency. We shall then have the two great things necessary to fix any paper currency, viz. good funds, which may give the possessor a certain security; and a quick demand and circulation of the currency itself.

6. It appears then, that if the said act was put into proper and wise execution, duly limited and sufficiently vigorous, it will answer the great and important ends expected from it; and tho’ it may not be thought the best possible, yet as it appears to be sufficient for its purpose, were it duly put into operation, and properly supported, I think it clear that the States ought not to hesitate adopting it, nor starve it by too languid and dilatory movements; the best plan possible may be rendered useless and ineffectual this way; wisdom and decision in counsel are not more necessary in any important plans of this sort, than vigor in execution.

I do not consider the act so much a scheme of increasing the revenue as of fixing the currency; but if it is to include both, the first certainly depends on the last, and is limited by it; for Congress cannot think of issuing any part of the new bills in a depreciated state; they must fix their value, or it is idle, dangerous, and ineffectual to the last degree to issue them; if they can be issued in a fixed state, yet no more of them can be issued than can be kept Edition: current; Page: [[116]] in a fixed state; for to exceed this limit, will be to destroy their whole use at once, and involve us in more distress than before. I look on it a very bold step to put the revenue on such a risk; but I suppose the public necessities require it, and of this the Congress are the best judges, and doubtless acted on more reasons than we out of doors can see.

The fixing the currency, and incomes of revenue are of of the last consequence to us all in the present crisis; and therefore it appears to me absolutely necessary that every State should exert themselves in the most speedy and effectual manner to give sanction and force to this act, lest, by their defect, the important chance should turn against us, and we should be left without revenue or currency at this critical time, when our political existence, as well as the occupation and means of living of every individual, depend on both.*

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To have a currency of fixed value, and the same as is expressed in the face of the bills, is an object most important and desirable, but can be obtained in no other way than by keeping the quantity within due bounds, and ascertaining its value, by such connexion with our real substance as will make it a certain security to the possessor. The value of money being wholly grounded in the proportion of two objects, viz. the quantity of money, and the objects of money, it is demonstrable that if either varies, whilst the other continues the same, the proportion must vary likewise, and of course the value of the money must fluctuate, as appears most plain to any person who has the least knowledge of the nature of proportion.

All experience justifies and confirms this reasoning, and puts the truth of it beyond all doubt; yet so strongly does Edition: current; Page: [[118]] the infatuating bias, like some darling, favorite lust, work itself into our public counsels, that after the longest and gravest consideration of the subject, they will, in the face of the clearest demonstration, in spite of repeated experience and the fullest proof of fact, still work up their deliberations into the vain issue, the fruitless resolution of trying new methods, adopting new plans of increasing the currency, and thereby defeat their own purposes, render their counsels ridiculous, and leave us all without remedy. The mischief lies in the nature, not in the modification of this fatal charm; there is too much already, and it is not possible that any increase of quantity, however modified, should help the matter, nor is it possible to fix the value in this way; for the increase of the quantity will for ever render the punctual redemption of it more difficult, and therefore more uncertain, and of course of less credibility or credit.

The nature of money is such, that its quantity cannot be increased beyond a certain degree, without losing its use; this has already been far exceeded, and it is not therefore possible that our remedy should lie in further increases of it, however modified. I have known people try to fatten their hogs with pumkins, turnips, and bran, to save corn, but without success; I have known people who had not milk enough, add water to it, but the nutritious particles of milk were not increased thereby; I have known children change their pistereens into coppers, and gain a greater heap of money; in all these cases the substance was wanting; the show, tho’ increased, was delusive; and the counsels puerile and without effect, to say no worse of them.

Impending destruction is no longer a matter of empty declamation. All occupations of town and country are embarrassed and near to a full stop. Our public debts are every where increasing, and supplies failing. Famine, want, and total enervation of all strength and effort must be the speedy consequence. When the springs, the fountains, the resources are dried up, it is not possible but the streams must fail soon. We are in every respect well and safe, except in the article of finances. Were they restored, every Edition: current; Page: [[119]] thing else would immediately flourish and gain vigor sufficient for every purpose of safety and happiness.

There is in nature but one way to restore these, viz. by immediate recourse to our solid substance, by taxing equal to our expenditures. This I have often urged in vain; whenever it comes in view every countenance gathers paleness. True, but it is impossible, is the cry. Had it been a spectre, or goblin of terror, it could not have been started from and avoided with more precipitation. People will even take fatal leaps into certain destruction, to get away from it.

Pray, my countrymen, let us muster up a little courage and firmness of mind, and not, like a distempered imagination or guilty conscience, start with terror at a distant movement of we know not what. Let us compose ourselves, and take a little nearer view of this dreadful expedient; it is not so frightful in near view as in distant apprehension. There is such a thing as being penny wise and pound foolish. We may lose the ship for fear of hurting the sails.

  • Presence of mind and courage in distress,
  • Are more than armies to procure success.

A cool and careful examination of the subject will at least let us into the truth of it; and be that truth ever so hard and dreadful, our knowing the worst of it, is preferable to suspense.

Many things which strike us at first as intolerable or impossible, lose much of their difficulty and terror by growing familiar to us. Could we have thought it possible to support the dreadful war which we have hitherto sustained, had it been held up to our view five years ago? The remedy now proposed is but trifling in comparison of what we have suffered. And shall we sink disheartened in sight of a desirable shore, after we have surpassed the tempests and billows of the ocean thro’ the voyage? The remedy I propose, is allowed by all to be effectual and sufficient, if it can be practised; and we shall find it the only one that can save us from ruin; at least this is my opinion, after Edition: current; Page: [[120]] more than six months’ close attention to the subject, and viewing it in every light in which I can consider it.

I conceive, if it should appear that each industrious individual loses more for want of the tax, than his tax would amount to, that every doubt of the expediency of the tax would instantly be removed and vanish at once; and I think this may be made very clear and plain. I shall attempt to prove this.

I. The tax demanded will amount to about 4 hard dollars in a year to each person in the States, or 20 such dollars, or the value of them, to a middling family of 5 persons; and this will, by the due apportionment of the tax, be lessened to the poor and increased to the rich, in proportion to their abilities. This is the height of it; this is the worst that can happen; this is the dreadful price demanded for our salvation, to save us from sure destruction, and which the Thirteen States are deeply hesitating and contemplating whether they will pay or no; at least this tax is what the Congress are hesitating to recommend, and the States to levy and collect, tho’ I doubt if the people would hesitate a moment to pay it, if it was put under collection, especially if it was demanded in monthly rates, which would render the payment much more practicable than it would be, if it was all called for at one payment. Now we will consider what is lost for want of this tax.

1. Every industrious man loses his business, his occupation, or at least finds it greatly embarrassed, and subjected to great difficulty and discouragement: for, I submit it to every man to judge, whether, in the present fluctuoting state of the currency and mode of procuring the public supplies, whether, I say, it can be safe or prudent for any man to lay out any business of husbandry, mechanic arts, or merchandise, on any large scale, whilst he knows not what he must sell his proceeds for when he has got them, or whether he may have the selling of them at all or not? These embarrassments are very sensibly felt thro’ the States, but would all vanish, if our finances were restored. And I think it very plain, that a man’s occupation must be very poor indeed, Edition: current; Page: [[121]] if these embarrassments are not more damage to him, than his whole tax would amount to.

2. For want of the tax, the supplies of the country are daily lessening, our plenty wastes away fast, and scarcity and want are succeeding in the place of them. This makes every man’s estate in the country less valuable, as it is apparent that an estate in a country of poverty and want, is not so good, or worth so much money, as the same estate would be in a country full of riches and plentiful supplies. All means of living will of course become harder to be obtained, as it is more difficult procuring supplies in a country where they are scarce, than in one where they are plenty. What may be the amount of loss to each individual from these causes, is not easy to calculate; but as they affect the whole bulk of estates, and operate on the whole means of livelihood, they cannot be supposed small, and I think will readily be allowed to exceed any man’s share of the tax necessary to prevent them.

3. For want of the tax, the morality and industry of the people are greatly diminished. Frauds, cheats, and gross dishonesty are introduced, and a thousand idle ways of living are attempted in the room of that honest industry, economy, and diligence which heretofore blessed and enriched this country. And as an estate in a country of honest, industrious people, is better than in one filled with idle rogues; and as all property is hereby rendered more unsafe and less valuable; it is very easy to see, that the loss of each individual in this respect, will be very considerable, and must, on a very moderate computation, much exceed the tax required to remedy the whole mischief.

4. For want of the tax, our trade is decaying fast; and this not only ruins the merchant, and renders the procurement of such necessaries as are usually supplied by our trade, more dear and difficult, but it enervates the whole system both of husbandry and mechanic arts, as these can never flourish without a market, where the produce of the farmer and the fabrics of the mechanic may be sold, when ready for sale. This affects the whole country in a most material manner, and must at least involve each individual in Edition: current; Page: [[122]] a loss of more than his tax would amount to, sufficient to give a fixed value and use to our currency, and thereby restore our trade and husbandry to their former vigor.

5. For want of the tax our defence must cease, and we must lie open to the ravages and plunders of our enemies; the very risk and danger of which involves many distresses that must occasion loss to every individual, far greater than the whole amount of his tax would be towards such defence as would render the country quite safe and secure. Add to this, the danger of being finally overrun and conquered by our enemies, and falling under their unrestrained power; in which case, they would doubtless extort perpetual taxes from us, to as great amount as are now required for a short time to secure us against their power.

6. The want of this tax enervates our laws, renders their fines, penalties, and forfeitures uncertain and ineffectual; destroys the salaries, fees, and rewards of our civil and religious officers, and of course prevents men of abilities from serving in the character of judge, sheriff, gospelminister, schoolmaster, &c. and of course the whole system of our civil and religious polity, and education of youth is clearly on the decline to a very dangerous degree; but as all these institutions tend much to the happiness of society, any decline of them must greatly prejudice the value of every estate, and the prospects of happiness and utility arising from it, to an amount greatly beyond the tax required to secure all these wholesome institutions in their fullest use, respectability, and general influence.

I might add here more instances of loss incurred by individuals from the fluctuating state of our currency and disorders of our finances, which would be all remedied by the tax I recommend; but it appears to me, those already adduced are grounded on such obvious and notorious facts, are of such interesting concern, and of such forcible conclusion, that if they do not convince, it is needless to offer more on the subject; it is vain to offer arguments to people who will not give a shilling to save a pound; and yet this is much more than the tax I propose, requires, however it may be aggravated and heightened by stingy, timorous, Edition: current; Page: [[123]] or corrupted men, into an exorbitancy utterly insupportable.

II. As the money collected by taxes, or other money to the amount will be constantly issuing, the payment of heavy taxes will be rendered as easy as the nature of the case admits; while at the same time the great demand for money occasioned by the tax, will be sufficient to keep its value fixed, and its uses well secured and preserved. The facility of raising sums of money when the circulation is brisk, and the demand quick for goods on hand, is easily conceived, by any person in the least acquainted with trade. This mightily lessens the burden of the tax below what it would be, if collected in a dull time of business, and scarcity of cash, and consequently the tax itself becomes less sensibly felt under these favorable circumstances of easy procurement, than the same would be, if deferred to some future time, when there might be less demand for goods, and greater scarcity of cash; therefore it is the interest of every individual to pay his dues to the public whilst he can do it with the greatest ease, rather than defer it to some future time, when he may happen to be called on for it at a juncture when the payment will be more difficult and distressing than now.

III. The price of most kinds of country produce is much higher than it is usually in times of general quiet, and therefore the tax may be paid much easier now than then; as a bushel of wheat, a cow, a sheep, &c. will bring much more now than it will do when quiet is again restored, and of course ought to be sold now, that the payment may be made whilst it can be done with most ease and advantage; for what is not paid now must lie as a debt to be paid in future time, when it will probably take near a double quantity of wheat, beef, mutton, pork, &c. to pay it, as would now be sufficient.

IV. Further, a prudent man will never let a demand lie against him when he can conveniently satisfy it; and a public debt is the worst of all kind of demands, when a man is not ready for them; for I submit it to every man if he would not see any sort of creditor come to him when he was Edition: current; Page: [[124]] unprepared to pay, rather than a public collector. Present payment avoids all this trouble and mortification, as well as saves much by the high price which that produce will now bring, which must be sold to pay the tax.

V. The tax will procure a good market, and sure, sufficient payment to individuals who have such articles for sale as are needed by the public; whereas for want of the tax, thousands who have sold their goods to the public, have been paid in a useless currency, or have not been able to get any payment at all, to their great disappointment and damage. This is a consideration of great importance to most people in the States, as there are few who would not choose to supply the public with some kind of goods or services in their power, if they could be sure of punctual and sufficient payment. The having a quick and profitable market for what is made ready for sale, is no small advantage to every individual; for without this all his goods which he does not need for his own consumption, lie useless on his hands, or his time may be lost for want of an employer, who would pay him for his services.

The advantages resulting from this one circumstance would be equal to the tax to many thousands of individuals; as the goods or time they would lose for want of a market or employers, would be more than equal to the tax, as they have experienced to their sorrow, who have lost their goods for want of a market, or sold them where they could not get their payment either in due time, or in currency of certain value.

VI. The tax would remove all cause of complaint, and put an end to the great oppression which has taken place much too long; for if the burden is laid equally on all, no one can have any cause to complain of oppression when his share is demanded; but without this the supplies wanted for the public must be taken by force or fraud from the owners, without payment, to their great oppression and injury. Indeed if supplies are not procured and sent to the army, these oppressions must be multiplied to a very tragical degree; for to disband the army and send them home, when their present supplies are spent, will not probably be Edition: current; Page: [[125]] either safe for the country, or agreeable to them; they must therefore live in free quarters; they will probably be directed to march into such States and towns as have been most deficient in furnishing their quotas: but even in that case, thousands of individuals will suffer, who have not been guilty of any deficiency or delays; for in cases of such extremity, the innocent must be involved with the guilty, and of course oppressions must be infinite, and very terrible. The burden of the tax bears no proportion to the ruinous and most dreadful effects resulting in this one instance from the want of it.

VII. The tax in a few months will restore our finances, fix our currency, and put us in condition to unite our force with every possible advantage; and this will so clearly demonstrate our unbroken strength, union, and firmness, that the hearts of our enemies will die within them, and they will soon break up and leave us in despair. Their only hope of conquest has long been from the confusions of our finances; they have not attempted for two years past to oppose their capital force to ours, but have hung on us in hopes that we should soon sink under the pressure of our own expenses, and so fall an easy prey into their hands; and they will continue in this hope as long as they see us ringing the changes on visionary schemes, and trying in new shapes and attitudes an old delusion, that always has deceived us in every shape, and probably always will.*

VIII. This same thing will show to foreign powers our unbroken strength, great resources, wisdom of policy, and vigor in execution, give us great respectability in their eyes, and enable us to demand and expect any aids from them which Edition: current; Page: [[126]] we may need; for the state of human nature is such, that those can get least help who need it most, and those can procure most friends who need them least; and the best way for a man or a nation to get assistance from his neighbours is to be able to do without it.

On the whole, I do not see that any thing more is necessary, than wise, decisive counsels, put into action with spirit and resolution. We have enough to do with, if we had but spirit and wisdom to call it into use; and I think this spirit is much more wanting in our rulers than in the people. In old times of distress among the Israelites, it was a sign of approaching deliverance when the Spirit of the Lord came on their great men, i. e. in the Hebrew dialect, a great spirit, great courage, and resolution, adequate to the work; as the trees of the Lord mean great trees; the sons of God were their great men, and thunder is called the voice of the Lord, because it is greatest of voices in the natural world. The Romans, without inspiration, somehow catched the same idea. Audentes fortuna juvat. They esteemed Fortune a divinity, ready to help those who had spirit and courage to help themselves. Little is to be expected from languid counsels, half assured resolutions, plans that want extent adequate to their purpose, and vigor of execution equal to their extent. If I could see a little more of that Spirit of the Lord which animated the brave old worthies, I should soon expect to see the sword of the Lord follow, and our troubles and troublers all melting away before us.

But before I quit this subject, I beg leave to add one thought more, which appears to me of the most capital importance, viz. that no plan of taxation, or any thing else, can be of any good effect, if there is not some method adopted to bring all the States into an union and punctuality of execution. The least company of men, who have a common concern, if it is but in a ship or piece of banked meadow, find it absolutely and essentially necessary to have some way to compel their partners into a punctual discharge of their quotas. The very existence of our union requires this. If one State hangs back, another will, and the best concerted plan possible may be rendered ineffectual by delays and defects in the execution.

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It is essential to the very being of any independent community, that it has in it all the powers necessary to its own preservation. These powers doubtless exist in the Thirteen States, as perfectly as in any other community in the world. And tho’ I do not pretend to understand the constitution of our union well enough to decide where these powers lie, yet I should suppose they must be vested in the Congress, as I know of no powers which extend over the whole, but theirs. But if it is thought that these powers are not sufficiently explicit and declared to be in them, it is necessary that this declaration should be made without delay, and put into such force as is absolutely necessary to give effect to our public counsels, preserve the union, and concentre the force of the whole, and prevent that destruction which may ensue for want of such union of effort for the common safety.

If it was possible for the tardy States to go to destruction alone, without dragging the rest after them, it might be best to dismiss them from the union with contempt. But as this cannot be done, it is necessary to the preservation of the whole, that some means be found to compel such States to keep pace with their neighbours, and bear their due proportion of the burden and duty, as well as receive their share of protection and benefit.

In fine, we want nothing but united and spirited efforts for a short time, to restore our finances, establish our currency, retrieve our honor, secure our safety, give vigor to every kind of business and occupation, recover our virtue, and make ourselves the laudable and envied example of wisdom and happiness to all the world. Our posterity expect and have a right to demand this from us. The eager eyes of all Europe are on us, ready to give their plaudit to our virtue, decision, and success. Our enemies tremble, for fear we should grow wise and virtuous; and Heaven opens the scene favorably, and has given us the lucky cards, and we have nothing to do but to play them out well.

  • Et dubitamus adhuc virtutem extendere factis,
  • Aut metus, hac libera, prohibet consistere terra.
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[First published in Philadelphia, Dec. 13, 1780.]

THE Tender-Act of November 29, 1780, is published by order of the Assembly of Pennsylvania for public consideration, and therefore the duty and respect due to the Assembly and the Public obliges every one to consider it, and offer such remarks on it as deserve public notice. In compliance with this duty, I have considered the said act, and the following Strictures appear to me of importance sufficient to engage the public attention.

The nature of a Tender-Act is no more or less than establishing by law the standard value of money, and has the same use with respect to the currency, that the legal standard pound, bushel, yard, or gallon has to those goods, the quantities of which are usually ascertained by those weights and measures; therefore to call any thing a pound or shilling, which really is not so, and make it a legal standard, is an error of the same nature as diminishing the standard bushel, yard, gallon, &c. or making a law that a foot shall be the legal yard, an ounce the legal pound, a peck the legal bushel, Edition: current; Page: [[129]] or a quart the legal gallon, and compelling every body to receive all goods due to them by such deficient measures.

Further, to make any thing the legal standard of any of these, which is not of fixed but variable nature, is an error of the same kind and mischief as the other; e. g. to make a turnip the standard pound weight, which may dry up in the course of a year to a pity of not more than two or three ounces, or to make a flannel string the standard yard, which will shrink in using to half its length. The absurdity of this is too glaring to need any thing further said on it.

But to come to the matter now in question.

The first observation which occurs to me is, that the bills, which are made a tender, contain a public promise of money to be paid in six years. On which I beg leave to remark, Edition: current; Page: [[130]] that the best and most indubitable security of money to be paid in six years, or any future time, is not so good or valuable as ready cash. The truth of this proposition is so evident and obvious to every body, that it cannot need proof.

Therefore the law, which obliges a man to accept these bills instead of ready cash, obliges him to receive a less valuable thing in full payment of a more valuable one, and injures him to amount of the difference; and is so far a direct violation of the laws of commutative justice—laws grounded in the nature of human rights, supported by the most necessary natural principles, and enjoined by the most express authority of God Almighty, and which it is not possible that any legislature on earth should have right to infringe or abrogate.

Again, the security arising from the public promise is not generally deemed certain. The public faith has been so often violated, and the sufferings of individuals thence arising have been so multiplied and extensive, that the general confidence of our people in that security is much lessened; and as a chance or uncertainty can never be so valuable as a certainty, those bills must and will be considered as less valuable than they would be, was the security on which they depended, free of all doubt or uncertainty; and consequently, the discount of their value will always be estimated by, and of course be equal to, this difference. Therefore, the injustice of forcing them on the subject at full value of present cash, is greatly increased.

These positions and reasonings are grounded on such notoriety of fact, that any explanation or proof is needless; and I hope an objection against a law, drawn from the most manifest and acknowledged injustice of its operation and effect, will not be deemed trivial, or be easily set aside or got over.

Naked facts are powerful things, and arguments sometimes do best, and have the greatest effect, when addressed to the feelings of mankind; and that I may press the matter as close as I can, I beg leave to propose the following case, viz.

Suppose a man of grave phiz and character should, in distress, apply to his neighbour for the loan of 1000 Edition: current; Page: [[131]] silver dollars, with solemn promise on his honor and truth to repay them in a month, and in the mean time the tender-act under consideration should pass into a law, and the borrower, at the month’s end, should tender 1000 of the new paper dollars in payment.

I beg leave here to propose to every Member of the Assembly who voted for that law, and to every other man, who is a member of this State, what their sentiments of that action would be, and in what light they would view the borrower, who tendered the paper dollars (i. e. 2/5 of the debt) in payment of the silver ones he had received; i. e. would they consider him as an upright, honest man, or a shameless rascal?

In whichever of the two characters they may choose to consider such a man, it may be proper to note, that the act in question, if passed into a law, would protect him, and not only so, but would subject the lender to the loss of the whole money if he refused to receive it. This is a somewhat delicate matter, which it is painful to dwell long upon. I will therefore close what I have to say on it with a few very serious remarks, the truth, justice, and propriety of which I humbly submit to the reader.

1. The worst kind of evil, and that which corrupts and endangers any community most, is that iniquity which is framed by a law; for this places the mischief in the very spot, on the very seat, to which every one ought to look and apply for a remedy.

2. It cannot be consistent with the honor, the policy, the interest, or character of an Assembly of Pennsylvania, to make a law, which, by its natural operation, shall afford protection to manifest injustice, deliberate knavery, and known wrong.

3. No cause or end can be so good, i. e. so heavenly in its origin, so excellent in its nature, so perfect in its principles, and so useful in its operation, as to require or justify infernal means to promote it. By infernal means I mean such as are most opposed to Heaven and its laws; most repugnant to natural principles of equity, which are all derived from Heaven; and most destructive of the rights of human nature, which are essential to the happiness of society, the laws of Edition: current; Page: [[132]] which are engraved by Heaven on the heart of every man; some wicked men have formerly said, “let us do evil, that good may come, whose damnation is just.”

But perhaps this sort of argument may not have all the effect I could wish on the mind of every reader. I therefore proceed to another argument, which goes to the nature and principle of the act itself, viz. that the creait or value of money cannot, in the very nature of the thing, be supplied, preserved, or restored by penal laws, or any coercive methods. The subject is incompatible to force, it is out of its reach, and never can be made susceptible of it, or controllable by it. The thing which makes money an object of desire, which gives it strength of motive on the hearts of all men, is the general confidence, the opinion which it gains, as a sovereign means of obtaining every thing needful. This confidence, this opinion, exists in the mind only, and is not compellable or assailable by force, but must be grounded on that evidence and reason which the mind can see and believe; and is no more subject to the action of force, than any other passion, sentiment, or affection of the mind; any more than faith, love, or esteem.

It is not more absurd to attempt to impel faith into the heart of an unbeliever by fire and faggot, or to whip love into your mistress with a cowskin, than to force value or credit into your money by penal laws.

You may, indeed, by force compel a man to deliver his goods for money which he does not esteem, and the same force may compel him to deliver his goods without any money at all; but the credit or value of the money cannot be helped by all this, as appears by numberless examples. Plain facts are stubborn and undeniable proofs of this. Indeed, this has been tried among ourselves in such extent of places and variety of shapes, and in every instance been found ineffectual, that I am amazed to see any attempt to revive it, under any devisable form whatsoever. Numberless are the instances of flagrant oppression and wrong, and even ruin, which have been the sad effects of these dreadful experiments, with infinite detriment to the community Edition: current; Page: [[133]] in general, without effecting in any one instance the ends intended. The facts on which this argument depends, are fresh in every one’s memory.

I could wish, for the honor of my country, to draw a veil over what is past, and that wisdom might be derived from past errors, sufficient to induce every one to avoid them in future. In fine, from the contemplation of the nature of the thing, and of the facts and experiments which have been made in every variety of mode, and supported by every degree of power and exertion, it appears as plain and undeniable as intuitive proof, that the credit or value of money is not in its nature controllable by force, and therefore, any attempt to reach it in that way, must end in disappointment, and the greater the efforts, and the higher the authority which may be exerted in that way, the greater must be the chagrin, shame, and mortification, when the baseless fabric shall vanish into smoke.

The only possible method then of giving value or credit to money is, to give it such qualities, and clothe it with such circumstances, as shall make it a sure means of procuring every needful thing; for money that will not answer all things, is defective, and has not in it the full nature and qualities of money. In this way only it will grow fast enough into esteem, and become a sufficient object of desire, to answer every end and use of money. Therefore, when the question is proposed, how shall we give credit or value to our money? the answer, the only true answer, is, bring it into demand, make it necessary to every one, make it a high means of happiness, and a sure remedy of misery. To attempt this in any other way is to go out of nature, and of course into difficulty, only to obtain shameful disappointment in the end.

There is nothing better than to take things in their natural way. A great and difficult work may be accomplished by easy diligence, if a good method and a wise choice of means are adopted; but a small work may be made difficult, very soon, if taken at the wrong end, and pursued by unnatural means. There is a right and a wrong method of doing every thing. You may lead with a thread what you Edition: current; Page: [[134]] cannot drive with whips and scorpions. The Britons have found this to their cost, in the unnatural means they have pursued to preserve and recover their dominions in America. I wish we might be made wise by their errors.

Felix quem faciunt aliena pericula cautum.

I would be willing to learn wisdom from Great Britain. Fas est ab hoste doceri. Amidst all their madness, and in all their distresses for money, they never once thought of making their bank or exchequer bills a tender, or supporting their currency by penal laws. But these considerations may have little effect on some minds, who are not very delicate in their choice of means, but seem resolved to carry their point, volente nolente Deo.

I therefore hasten to another topic of argument, viz. It appears to me the act is founded in mistaken and very bad policy, and by its natural operation must produce many effects extremely prejudicial to our great and most important interests.

1. It seems plain to me, that the act has a fatal tendency to destroy the great motives of industry, and to dishearten and discourage men of every profession and occupation from purfuing their business on any large scale or to any great effect, and therefore will prevent the production of those fupplies derived from husbandry and manufactures, which are essential to our safety, support and comfort. Few men will bestow their labor, attention, and good money, with zeal, to procure goods and commodities for sale, which they know they must sell for money which they esteem bad, or at best doubtful. This proposition is so obvious and natural, that it strikes the mind with conviction at first sight without proof, and is so amply confirmed by our past experience, that it can admit no doubt as to its truth or consequence.

The extent and dreadful effects of this are unavoidable and immense. If the industry of the farmer and tradesman is discouraged, and they cease to lay themselves out for large crops and fabrics, the consequence must be an universal Edition: current; Page: [[135]] diminution and scarcity of the produce of the country and most important articles of living, as well as commerce. The general industry of the country is of such vast importance, is an object of such magnitude, that to check it, is to bring on ruin, poverty, famine, and distress, with idleness, vice, corruption of morals, and every species of evil; but enumeration or enlargement is unnecessary here.

As money is the sinews of every business, the introducing a doubtful medium, and forcing it into currency by penal laws, must weaken and lessen every branch of business, in proportion to the diminution of inducement found in the money.

2. The same thing will render the procurement of supplies for the army difficult, if not utterly impracticable. Most men will hold back their goods from the market, rather than sell them for money of a doubtful credit; and there will be no possible way of collecting them, but to send a superior force into the country, and there take them by violence from the owner, which will occasion such an expense as will double the cost of the supplies by the time they get to the army, be subject to a thousand frauds, &c. &c. &c. This is the most obvious and ntural operation of the act, if we consider its own nature only, and is confirmed by such ample experience, recent in the memory of every man, that it can leave no doubt but all this train of michiefs must follow the act from its first operation.

3. I apprehend the act will, by its natural operation, tend to corrupt the morality of the people, sap the support, if not the very foundation, of our independence, lessen the respect due to our Legislature, and destroy that reverence for our laws, which is absolutely necessary to their proper operation, and the peace and protection of society. Many people will be so terrified with the apprehension of seeing their real substance, the fruit of their labor and anxious attention, converted into a bundle of paper bills of uncertain value, that, to avoid this evil, they will have strong inducements to rack their invention for all devisable ways and methods of avoiding it; and this will give rise to such Edition: current; Page: [[136]] numberless frauds, ambiguities, lies, quibbles, and shams, as will introduce the habit and give a kind of facility to the practice of such guile and feats of art, as will endanger the uprightness, plain honesty, and noble sincerity, which ever mark the character of a happy and virtuous people.

Many, who wish well to our independence, and have many necessaries for our army which they would wish to supply, will be yet held back from offering their goods, from the sole consideration of the doubtful value of the bills in which those supplies must be paid for; and instances of this sort I conceive will be so numerous, as greatly to affect the supplies of our army, and of course the support of our independence. The injuries and sufferings of people, who are compelled to take said bills in satisfaction of contracts for real money, will induce them in their rage to use the legislature, who formed the act, with great liberty, and perhaps gross direspect; whilst the habit of reproaching the legislature, and eluding the injurious act, will become general, and pave the way to an habitual and universal abhorrence of our legislature and contempt of our laws, with a kind of facility and artful dexterity in eluding the force of the whole code.

I freely submit it to my reader, if these consequences are at all unnatural or ill-drawn, if the surmises are at all groundless, or the painting a whit too strong. No art of government is more necessary, than that of keeping up the dignity and respectability of the legislatures, and all courts and officers of government, and exciting and preserving in the hearts of the people a high reverence for the laws; and any thing which endangers these great supports of the state ought to be avoided as a deadly evil.

4. The act, I apprehend, will give a bad appearance to our credit, honor, and respectability, in the eyes of our neighbours on this continent, and the nations of Europe, and other more distant parts of the world. For when they come to be informed that our own people must be compelled, by the loss of half their estates and imprisonment of their persons, to trust the public faith, they will at once conclude there must be some great danger, some shocking mischief Edition: current; Page: [[137]] dormant there, which the people nearest to and best acquainted with it, abhor so much; and of course, as they are out of the reach of our confiscations and imprisonments, will have little inducement to trust or esteem us. And

5. Will give great exultation and encouragement to our enemies, and induce them to prolong the war, and thereby increase the horrid penalty of imprisonment, which is to last during the war. When they see that our money is become so detestable, that it requires such an act as this to compel our own people to take it, they must at least be convinced that its nature is greatly corrupted, and its efficacy and use nearly at an end. When we see the passionate admirers of a great beauty forced by lashes and tortures into her embraces, we at once conclude that she has lost her charms, and is become dangerous and loathsome.

It cannot be fairly objected to these Strictures, that they suppose the bills funded by this act are of less value than hard money. The act itself implies this. The Assembly never thought of wasting time in framing an act to compel people to take guineas, joes, and Spanish dollars, under penalty of confiscation and imprisonment. Besides, the fact stands in such glaring light in the eyes of all men, that it is mere trifling to dispute it.

I dare think that there is not a man to be found, either in the Assembly or out of it, that would esteem himself so rich and safe in the possession of 1000 of these dollars, as of 1000 Spanish ones; and the most effectual way to impress a sense of the deficiency of the act on the minds of all men, and even discover the idea which the Assembly themselves have of it, is to enforce it by penalties of extreme severity; for were there no deficiency in the act, it could not possibly require such penalties to give it all necessary effect, nor is it supposable that the Assembly would add the sanction of horrid penalties to any of their acts, unless they thought there was need of them.

The enormity of the penalty deserves remark. The penalty for refusing a dollar of these bills is greater than for stealing ten times the sum.

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Further, the act alters, and of course destroys, the nature and value of public and private contracts, and of consequence strikes at the root of all public and private credit. Who can lend money with any security, and of course who can borrow, let his necessity and distress be ever so great? who can purchase on credit, or make any contract for future payment? in very deed all confidence of our fellow-citizens in one another is hereby destroyed, as well as all faith of individuals in the public credit.

Upon the whole matter, the bills must rest on the credit of their funds, their quantity, and other circumstances. If these are sufficient to give them a currency at full value, they will pass readily enough without the help of penal laws. If these are not sufficient, they must and will depreciate, and thereby destroy the end of their own creation; and this will proceed from such strong natural principles, such physical causes, as cannot, in the nature of the thing, be checked or controlled by penal laws, or any other application of force.

These Strictures are humbly offered to public confideration. The facts alleged are all open to view, and well understood. If the remarks and reasonings are just, they will carry conviction; if they are not so, they are liable to any one’s correction.

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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.]

I PROPOSE, first, some remarks on the subject of paper money, and, secondly, some particular consideration of the Acts of our Assembly for issuing the new Continental bills, with some reasons why I think the true interest of Pennsylvania requires that those acts should be repealed, and the issuing of those bills should be stopped or suspended for the present, and I hope to do this without offence; for the great interests of a State, in which 400,000 citizens are concerned, cannot be too well understood, nor the utility of its laws be too carefully examined, or the errors of them be discovered and amended too soon.

Two things are essentially necessary to give paper bills a credit and currency equal to hard money. 1. Such certainty of honest and punctual redemption, as shall fully satisfy the mind of the possessor. 2. That the credit and demand for said bills should be so constantly kept up, from the time of their emission to that of their redemption, that the possessor may be able, at any time, to pass them at hard money value. The first of these is provided for by Edition: current; Page: [[140]] the Assembly, if their act shall produce the certainty of redemption required, which I am not here to dispute: but the second is equally necessary; for should the bills pass from their emission to their redemption, or any part of that intermediate time, at a depreciated value, say 2, 3, or 4 for 1, tho’ they should be redeemed at full value at the expiration of their currency in the most punctual manner, yet the mischiefs they would occasion in the mean time would be infinite.

One of which would be, that the depreciation itself would render the final redemption of the bills at full value both unjust and pernicious, as well as very hard and oppressive to the body of the people; for, in this case, the people must be taxed, say two, three, or four times the value or current exchange of the bills; not to the public benefit, but solely to increase the wealth of those rich people, who will hoard up the bills, and have them in possession at the time of their redemption. From which it appears (and indeed I think it may be demonstrated from the plainest principles) that public bills ought always to be redeemed at that value or current exchange, at which they usually pass at the time of redemption, let their nominal value be whatever it may. Indeed, the infinite and ruinous mischiefs of a fluctuating currency are so generally felt and well understood, that I conceive there is no need of proof, that it is equally necessary to keep the value or exchange of bills stable and unvarying thro’ the whole time of their currency, as to provide sure funds for their final redemption, and that the first of these does not depend solely on the last. The first of these depends on opinion, persuasion, and general practice; the last on the ability and integrity of the redeemer.

If you offer a bill to a stranger, he never thinks of asking when, by whom, or how certainly that bill is to be redeemed, but his only question is, whether he can pass it again? Not one in a thousand who takes a public bill, takes it with a design to lay it up five or six years, tho’ its redemption be ever so sure at that time, but his object is immediate use, to serve his present occasions by instantly passing it again, or at least having it in his power to do Edition: current; Page: [[141]] it whenever oceasion may offer. I take it that these principles and reasonings are perfectly plain and clear, and will afford, by the clearest inference, the following consequence, viz. That no public bills ought ever to be issued, which have not these two great and essential supports, 1. a certainty of final redemption; and, 2. such general confidence and demand, as will insure their currency at full value without depreciation, during the whole time of their circulation.

Indeed, it appears to me, that to issue public bills without these supports is the plainest folly, bordering on insanity, and must be very criminal, when done in the face of clear evidence and conviction. It further appears to me, that the new Continental bills have not these supports at present, and therefore ought not to be issued till these supports can be obtained, and of consequence, that the great interest of the State requires that the laws for issuing them should be repealed; or at least that the issuing them should be suspended till these supports can be obtained; for which I offer the following reasons, which seem to me to be of weight and force sufficient to engage the most serious attention of the public.

1. The quantity (viz. 10,000,000 of dollars) is at least four times as much in value as all the old Continental bills, and therefore must, from the nature of the thing, depreciate it, were its funds ever so indubitable, and the public confidence in it ever so great.—I conceive the present mean exchange of the Continental bills is about 100 for 1, at least they cannot be set at less than 80 for 1, on any sure facts, which makes the whole quantity (viz. 200,000,000) worth 2,500,000 of hard dollars, which is but one fourth of 10,000,000;—and further, that increasing the quantity of money will (cæteris paribus) decrease its value. This will always be a natural truth, as long as the value of money is nothing but the proportion between the quantity of circulating money and the occasions of money (as I think I have demonstrated in my Essays on Free Trade and Finance, and especially in the Second Essay) and which now Edition: current; Page: [[142]] is become such a received truth, that it cannot need further proof here.

2. The sum of 10,000,000 of dollars, added to the other bills which will continue circulating, such as State money, and certificates of various kinds, &c. is much more paper money than the Thirteen States ever did or can bear. The whole circulating cash of the Thirteen States, on the best calculation I have been able to make, never did exceed 12,000,000, I rather think it not more than 10,000,000 of hard dollars in value, and not more than half, or at most three fifths, of the circulating cash in this State was paper in 1774; and I am convinced, by very good documents, that that proportion was not exceeded in the other States, where paper money was circulated; and as most of the trade and business that requires stock or cash, is now in stagnation, there cannot be occasion for so much circulating cash as in 1774, when every business, trade, and occupation was in full vigor.

Indeed, it is easy to make a pretty just estimate of the quantity of circulating paper which the country can now bear, from fact, viz. from the value of the present circulating paper, of which the Continental bills are much the greatest part; by which it will appear, that the present circulating paper cannot exceed four millions of Spanish dollars in value,—and that it is as much as the Thirteen States can bear, or rather more, is plain from this,—viz. that the paper of all sorts continues to depreciate. Now, in these circumstances, to pour on 3 or 4 times as much new paper as we are found, by experiment, by plain fact, able to bear, is in my opinion a sure way to depreciate it. I think it is not more certain, if you pour three or four buckets of water into one that is already full, that some of it must run over; yea, I think that the whole quantity you pour in must all run over.

3. We have already too much money circulating among us, for it is certain that even hard money will not purchase more than two thirds as much labor, country produce, or other necessaries, which are not heightened in their price by the extraordinary expense of importation, as the same Edition: current; Page: [[143]] would have purchased in 1774. Hence it follows, that the quantity of money has increased beyond the occasions of money in that proportion. This is reasoning on sure principles, which any body may disprove that can; the price of market, rents, and even real estates, afford a most plain and striking proof of this; it is further to be noted here, that the French and British armies import much money, which they are daily spreading among us, and thereby rapidly increase our circulating cash. It follows then, that our best policy is to reduce the quantity of our circulating medium, especially that dangerous part of it which consists in paper, that we may avoid, as far as possible, the further horrors and mischiefs of a depreciating currency, rather than to increase the evil by pouring in immense additions.

4. The present Continental money passes at its exchange thro’ all the Thirteen States readily enough; any thing, even hard money, may be purchased with it; therefore it answers well the ends and uses of a circulating medium. But the new bills, however well established their funds may be, have not the confidence of the public in general, nor will they be readily received. They are a new thing, and their fate uncertain. This will naturally depreciate them in the first beginning of their circulation, by which the whole commerce of the Thirteen States, as well as the public finance and expenditures, will receive the most essential injury. Now to call in a currency that is well received, and which answers well the ends and uses of a circulating medium, and issue instead of it one of doubtful credit, which will probably be received with diffidence, if not disgust, appears to me the height of absurdity.

5. The new bills, however funded, must stand on the same basis as the old, viz. the public faith, which, however modified, is neither better nor worse in the one case than the other, and therefore the new bills will depend on no better supports than the old ones, and of consequence nothing can be gained by the exchange, the trouble, risk, and expense of which must therefore be wholly lost.

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6. If the old bills should depreciate, the public will gain the depreciation; but if the new bills should depreciate, the public must lose the depreciation, or must suffer a second bankruptcy to avoid the loss.

7. If the new bills should be emitted, they will not answer the purpose of a general currency, which is one principal end of their creation; but, like the State money, will be confined to the State that signs them. For it is very certain, that one State will no sooner take the new bills signed by another State, than they will take any other bills signed by the same State; for the Continental security, added to the new bills, is neither expressed nor intended to mend the credit or make good the deficiencies of any of the States, but such as are rendered incapable of payment by the power or possession of the enemy. The present Continental bills have a general currency, and therefore ought to be kept in circulation in preference to the new bills, if no other reason could be given for it.

8. Most of the other States who have emitted the new bills, have issued them at 40 for 1, i. c. at about half their nominal value, and it is in my opinion pretty much in vain for us to attempt to give our bills a better exchange or value than theirs have, in as much as their funds of redemption and means of intermediate circulation are as good as ours; besides, to attempt this would be to introduce such a variety, such a jargon of exchanges, as would defeat every purpose of a general currency of those bills.

9. If the new bills should be issued at half value, or should speedily depreciate to 2 for 1 (and I think on every natural principle they must depreciate to 3 or 4 for 1 by the time they are all out) I say, at 2 for 1 the States will not only—1. give 40s. for every 20s. which they issue; and, 2. give 10 per cent. interest in hard money for it all; but, 3. when they have issued it all, it will pay but half the expenditures of the year, if those expenditures are 10,000,000 of hard dollars, as they are generally computed; for it is plain that 10,000,000 at 2 for 1, will pay but 5,000,000 real money; and if the whole 10,000,000 should be called in by taxes within the year, yet at the end of the Edition: current; Page: [[145]] year, the States would find themselves in debt 5,000,000 of hard dollars, over and above the heavy balance now against them, and the annual increase of the public debt abroad.

But if (as will most likely be the case) most of the new bills should be outstanding at the end of the year, we must add to the aforesaid 5,000,000 of hard dollars debt, the amount of all the outstanding bills, with one year’s hard money interest on them all—a vast chaos this, equal to the dreary regions of ancient night! My reader may think my reasoning is sanguine, and expression strong, but both proceed from the real convictions of my own mind, from the force of truth.

If I have discovered and described properly these operations of the new bills on the Thirteen States, it follows that this State must take its share of these consequences if they issue their quota of them.

What I would humbly propose, instead of this measure, is, to repeal the acts for issuing the new bills, or suspend their execution till we are in condition to give them a currency truly and really equal to hard money, and keep them so; and in the mean time to continue the circulation of the present Continental or State bills, or both, till we can get hard money enough for a currency, or till time and wisdom shall discover some other resource, less fraught with dishonor, disappointment, and ruin.

In fine, taxation equal to the public expenditures is, in my opinion, the only method in nature by which our defence can be continued, our independence be preserved, a destructive increase of the public debt be avoided, our currency (hard or paper) be kept in a state of fixed value, the natural springs of industry be given to every profession of men, our supplies made plentiful, the public confidence be restored to the public counsels, the morality of our people be revived, and the blessings of heaven be secured to ourselves and our posterity. All this, I conceive, is proved fully in my five Essays, especially the Fifth, to which I refer every one who is not already weary of my thoughts, and would wish to be further acquainted with my sentiments on this subject.

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Upon the whole matter, I conceive that union in counsels, uniformity of method in our finances, and the benefits of a general currency, were the principal objects of the resolution of Congress of the 18th of March, 1780 (tho’ I confess I never could see the advantages of that resolution.) I further conceive these objects are already lost; for the different exchange at which the different States issue and pass the bills, and the want of confidence of the States in each other (for one State will not take the bills of the other States, as we find by experiment) together with the deficient and dilatory supports given to those resolutions, I say, all these together destroy the intended union of counsels and uniformity of finances, and render a general currency of the bills impracticable.

Indeed, I ever considered the enormous quantity of bills proposed for emission in the said resolution, to be a seed of mischief, which would grow up with force in the course of its operation, and defeat its effects; the ill consequences of which could no otherwise be avoided, than by the most strenuous and united efforts of the States in its support, and using the greatest prudence and caution as to the quantity issued; all which I noticed with great freedom in my strictures on said resolution, in my Fifth Essay, published ten months ago. It now appears that the efforts of the States in support of said resolution have been very dilatory, far from decisive, and widely differing in the manner of exertion; that the general confidence of the public in the success of the bills is greatly shaken; and that the general currency of them is rendered impracticable, and not to be expected, and of course that the great design, and benefits of the measure are already become desperate.

I cannot see that it would be wife in our Assembly further to pursue a scheme, the principal objects of which are already defeated, and which, of course, has already lost its capital uses; especially when there are so many and important objections lying in the way of its operation: to suppose that we can cut our way thro’ all these difficulties, and force the bills into circulation by penal laws is an idea which I cannot think admissible, for the reasons I alleged in my Edition: current; Page: [[147]] Strictures on the Tender-Act, whilst it was under consideration; at least this dependence is dangerous to a great degree, for should it fail, we shall be left dreadfully destitute, without any cash at command, and without time or means of recurring in season to our more sure resources.

If the emission of the new Continental bills should be laid aside, we may be able well to support our new emission of state bills; if the demand for them is sufficiently increased by taxes which is very practicable; and if the legislature could be prevailed on to take off the penalties of the tender-act, which were designed to enforce their circulation, but which, in my opinion, add horror to the currency itself, and raise doubts and fears which otherwise would not be thought of; and, in any view, stand as a monument of the weakness of our public credit, which requires such unnatural supports to keep it in existence, and will be a monument of our folly, shame, and inadequate policy, if it should fail of producing the effects intended.

I apprehend it would be much more sure, natural, and advisable, if we need money for any use, e. g. to pay and feed the army, &c. to lay a tax on our people for it, and solemnly appropriate it to that purpose only, and tell them so. I am of opinion such a tax would be speedily and cheerfully paid, and let the same be done for every other branch of expenditure. This will be settling and finishing the matter as we go along, and will keep our State and counsels free from the confusion of perplexed finances, the endless labor of settling public accounts, the pressure of a public debt, and the disheartening horrors of future endless taxes, to discharge the Lord knows what of interest and principal, which will remain to be paid in future time.

If other States are disposed to involve themselves and posterity in an endless labyrinth of confused accounts, fluctuating currency, and immensity of debt, it does not follow that it is either prudent or necessary that we should imitate their example. If we satisfy the quotas (demanded by Congress) as well as they, we do our duty as well; and if this be done in a way of more ease and safety to our Edition: current; Page: [[148]] own people, the other States cannot be prejudiced by it; and if they should apprehend that our method has more advantages in it than theirs, instead of blaming us, they may, if they please, follow our example. If this should not suit them, they will be at liberty to load themselves with paper, whilst we shall draw their hard money to ourselves, which will be the natural and unavoidable consequence of their continuing, and our restraining, the emissions of paper money.

The same thing will fill our State with the best inhabitants; for it is plain that every sensible man would choose to settle himself in a State free of debt, rather than in one loaded with a debt which would require the galling taxes of an age to discharge it.

But, all this aside, I would rather discharge the expenditures as we go, tho’ it should prove heavy, than to leave a legacy of debt on posterity, which will mix bitterness with the sweets of that liberty which we are endeavouring to procure for them, and induce them to censure the humanity of our counsels, and lessen their gratitude to us for a most valuable blessing secured to them, because they will find themselves charged with the expense of it.

But still I expect to hear the old cry against my principles, that they are good in theory, but not admissible, because impracticable; that taxing equal to the expenditures is impossible, because the people cannot bear such weight of taxes; but there is no disputing against necessity, I therefore beg the reader’s patient attention to the following short propositions.

1. Taxing equal to the expenditures is the only possible method of keeping our currency to a fixed value; for if there is more money in any country issued into currency, than is taken out during the year, there must be more money in circulation at the end of the year than there was in the beginning of it, and an increase of quantity will depreciate the value of any currency (hard or paper:) this depends on principles as natural and unalterable as the laws of gravitation, or powers of the magnet.

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2. A fluctuating currency is by all men confessed to be a calamity, much more dreadful and ruinous than any degree of taxation necessary to prevent it.

3. The mischief of a fluctuating currency is dreadfully increased by all regulations, tender-acts, and every other application of force made use of to prevent it; the noise, force, and devastation of an irresistible current are dreadfully increased by obstacles thrown in its way, beyond what would happen, if it was suffered to take its natural course without interruption; for a practical proof of these two last propositions, I appeal to the experience of every man of any business, with this plain question, “Sir, would you not rather pay your share of the whole expenditures of the year in monthly or quarterly taxes, than suffer, thro’ the year, the pains, injuries, and inconveniences of a fluctuating currency, with regulations, committees, tender-acts, and penalties in force?” I dare believe that scarce a man of business and character can be found in this State, who would not readily answer, and from full conviction, that the tax would be much the least burdensome of the two.—I will then state my propositions with freedom, and submit them to the candid examination and censure of the public. I propose,

1. To repeal the acts for issuing the new Continental bills, of March 18th, 1780; and

2. All the tender-acts; and

3. To let the laws have their free course to oblige every man to fulfil his contracts as plain justice requires; in order to this, a scale of depreciation* for some time past may be easily made for the government of the courts; or the court and jury may be empowered to give judgment for what appears to be in justice due, on the full hearing the case; i. e. I humbly propose to be honest once more, to revive our old notions and practice of justice and equity; i. e. to suffer justice and judgment to run down our streets, and overflow our land. My reason for this proposal is, because I Edition: current; Page: [[150]] really believe it is both a natural and revealed truth, that “righteousness exalteth a nation, but sin is a reproach to any people.

4. To issue a tax for whatever money we want for public use, which will lay the public burden on all equally, in proportion to every one’s ability, and cannot wrong or ruin any body.

5. To continue the new State money, or old Continental bills, or both, in circulation. I do not think that Congress will object to this on a review of the case; for the old Continental bills are the only paper money among us, which has any chance of a general currency thro’ the Thirteen States, and I look on a general currency to be an object of such indispensable necessity, such vast magnitude, that Congress will rather choose to relinquish an old resolution already in ruins, than attempt to support the vast expenses of the Thirteen States, without any general currency at all.

6. I propose to call in the old State money (i. e. all the old State money made since the last bills under the crown) at its present exchange or current value,* which may be easily done by a tax made for hard money, or that money at the present exchange. We shall then have no bills to redeem, but the new State bills, and our share of the old continental ones.—These things I conceive to be more practicable and less burdensome than the omission of them would be, and will be a good introduction to our reinstating our public finances, and restoring the industry and morality of our people, and of course recovering our trade, manufactures, and husbandry.

The whole is freely submitted to the consideration of the public.—It is undoubtedly mine as an individual to examine, Edition: current; Page: [[151]] remark, and propose; it is the public that must adopt or reject, and may God give the wisdom necessary to the due exercise of this great privilege.

I beg leave to conclude, by observing that this State, and our posterity, born and unborn, are yet on this side the bottomless gulf of infinite debt,* shame, and slavery, but they stand trembling on the brink of it, and it depends much on our present counsels, whether they shall be pushed in or not.

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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.]

THE exhausted state of the public treasury, and the universal disorder of our finances, the pressing demand for supplies for every department of the public service, the convulsions which begin to appear, and the general confusion that threatens us, are become very serious and alarming, are become matters of very anxious concern, and even painful despondency, in the minds of many very wise and good men; and the public necessities are thence arisen to such a pitch of urgency, as must convince every thinking man that a speedy remedy or ruin must be the consequence. In this dreadful crisis, I will venture to lay before the public some thoughts on the present state of our affairs, and the ways and means of deliverance, which appear to me most wise, natural, and practicable; and this I propose to do with the same openness and freedom of mind and expression, which I have heretofore used, and hope for the same candor and indulgence from the public which I have heretofore experienced,

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1. Our country is not exhausted; it is full of supplies of every kind, which are needed for public service. We have men enough who would wish to serve in the army, if they could be properly supported and paid. We have provisions and all other supplies enough in the hands of our own people, who wish to sell them to any body who would pay for them.

2. We have unanimity and general zeal for the great cause of liberty, for which we are contending. Neither our public counsels nor movements are obstructed or weakened by strong, opposite factions, wasting our wisdom or force in counter-working each other. The most dangerous and alarming commotions among us, show such firmness, zeal, and unshaken attachment to the great American cause, as plainly demonstrate that they do not at all arise from disaffection, but from other real, distressing causes.

3. We want nothing but wisdom, to draw into use the force and supplies of which the country has sufficient plenty. Like the foolish prodigal, we are feeding and starving on busks, while there is bread enough and to spare, within our reach; and if we fall at last under the power of our enemies, we shall fall a sacrifice to our own folly, not to their wisdom or power; to the weakness of our counsels, not to the want of sufficient strength; if we fall at last, no nation or people ever fell more despised, or less pitied. Our absurdities of counsel will be topics of ridicule and by-words of scorn, whilst our posterity will be noticed groaning under the iron rod of oppression, and lashed into that effort for the benefit of their masters, which would now be sufficient to secure their and our liberty; but which we have not now wisdom and virtue enough to call into use.

How will the by-standers laugh, and our poor posterity groan, at the absurdity of our plans of appreciating our currency month by month, whilst every cause of depreciation continues and increases;—of lessening the number of buyers, in order to increase the sellers;—of limiting, forcing, and reducing the market, in order to increase the quantity of goods brought for sale;—of forcing credit, value, and desirableness into our currency by tender-acts and penal laws;—and of Edition: current; Page: [[154]] procuring the vast supplies for the public service, by taking away every inducement of industry, and throwing every branch of our trade, mechanic arts, and husbandry into stagnation;—and, which caps all the rest, the sacred scheme of supporting our government, and securing all the blessings of liberty by a shameless departure from every principle of honesty and justice, which is essential to the very existence of civil society.

These are but few of the absurdities in politics which we have seen adopted, and forced into practice by every application of compulsive methods, and with a perseverance incredible. Nothing but the absolute impossibility of the practice could compel the chimerical zealots to discontinue their mad career; but, however laughable to our enemies, and distressing to our posterity, and incredible to both, these things may appear, they may be of use to us, as the dreadful and destructive consequences, the shame, disgrace, and ruin, which we have seen resulting from them, and which now threaten us in a manner that makes every considerate face gather paleness; these, I say, all tend to work an universal conviction in the minds of all men, of their total inutility and the absolute necessity of an immediate reformation.

And as a necessary means of it, to reject for ever from our public counsels, those weak, unprincipled men of wild projection and madness of design, who have infatuated the land with their extravagant chimeras, and drawn many of the honest, unthinking, but too easy people into their methods of shame and ruin. A man will not kill his own child, tho’ ever so monstrous; nor is it to be supposed, that these authors of our present distress will ever heartily concur in the rejection and public censure of their own darling schemes, or that they are capable of that wisdom necessary to bring about a total reformation.*

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Here I must stop a little, and observe that the thing which makes one nation excel another in glory, political prudence, and happiness, is most commonly this, viz. That men of genius, abilities, integrity, and industry, are placed at the head of their public departments. The public will ever receive its tone, in respect of its dignity, fame, good order, and happiness, from the men who are intrusted with the management of the public affairs. This observation is so manifestly true, that every man, in the small circle of his own domestics or neighbours, can judge well how any business will be done, if he knows who is to do it. We cannot hope for reformation and good management of our public affairs, unless we see judicious, upright, and steady men in the several departments of the State; men adequate to the offices they fill, and industrious and persevering in attending thereto. But to return,

I will suppose for once that every public department was filled with the best and most suitable men, and that every individual was willing to adopt and pursue the best methods of safety and deliverance which our case admits; what then can and ought to be done? I answer,

1. Every man is to be called on for the debt which he owes the public. Every man stands indebted to the public for his share or proportion of all the money or supplies necessary to the public safety, and this debt must be paid, or the public safety must be insecure, must be in danger. The public safety cannot be put off, as some people serve their Maker, with empty prayers and good wishes. This payment can ruin Edition: current; Page: [[156]] nobody. It is manifest, that if any individual, even the least able to pay, should, by some accident, lose as much money or other estate as his share of this debt amounts to, it would not ruin him, it would not greatly distress him; for the truth of this I appeal to every man’s knowledge of his own and his neighbour’s circumstances; but on the other hand, how many thousands of individuals are ruined for want of this payment? Dreadful and swift witnesses of this are, all those who have suffered by the violations of our public faith, by the depreciation of our currency; all those who are not paid for the produce of their lands, or personal services, or other fruits of their labor, with which the public has been furnished.

The people of the Thirteen States are almost in the same condition which they would have been in, if they had sold their principal produce to bankrupts or broken merchants, who could not pay them. They, by this means, have not money to pay their debts, to trade with, to buy of the merchant, to lay in their stock for the ensuing year, to increase their scale of business, &c. &c. One disappointment creates another; an universal stagnation of business is the consequence; and all industry is checked even in its first principle, as well as in practice; and of course the produce of the lands, and the fabrics of the tradesman are daily lessened, and of course the great stock for home consumption, and the great staples of trade, are daily dwindling away. These are facts notorious to every body, and arise directly from this, viz. that there is not public money enough to pay the public creditors.

Whereas, if every man was called on for his share of the public debt, there would be money enough to pay every body, and all this dreadful deluge of calamity would be remedied at once, and every individual would be a gainer by the tax he would pay, because he loses more every year by the confusions and disappointments arising from this want of public monies, than his tax would amount to. This is all mighty well in theory, but impossible enough in practice. Do you say this in earnest? I do most seriously contend, Edition: current; Page: [[157]] that it is very possible in practice; it is possible, it is practicable, it is necessary.

2. To make out a true estimate of the public debts and demands, and issue a monthly tax for the amount, in which every one shall be called on for his share, and no more than his share. The money which is collected in the first month’s tax will go out again among the people, and help them to pay the next month’s tax; that will go out again, to be again called in by the third tax, and so on; and the quickness of circulation hereby excited will supply the want of medium; for it is plain to every man, that a guinea, which passes from hand to hand thirty times in one month, pays as much, and of course goes as far, as thirty guineas which are paid but once in a month.

It is further manifest, that such an universal demand for money will give it value, will make it an object of universal desire; this will give spring to industry, motion to every method of obtaining money, and security to every man who has obtained it. It is necessary for us to know the worst of the matter, let that worst be as bad as it will. Let us know how much it will cost to save our country, to restore our morality, our industry, our safety, and happiness. The profits of the year at most will do it, because no more is or can be spent in the year than is raised or produced in the year; for we loan abroad enough to pay for all we import from abroad for the public use.

It is impossible indeed to increase our husbandry or manufactures, without a free, open, and sufficient market. Shut or diminish the market, and the supplies of it will soon lessen; open and increase the demand of the market, and all supplies of it will soon increase. All this is too manifest to need proof; therefore it is necessary to remove wholly all obstructions of our market, all fetters, and restraints, and discouragements of business, such as, embargoes, tender-acts, limitations, regulations, &c. &c. Let every body be at liberty to get money as fast as they can, and be put under every natural advantage for doing it.

I am of opinion that our people would receive an enfranchisement of this sort with as much joy, as the inhabitants Edition: current; Page: [[158]] of Greece received the declaration of their liberties from the mouth of the Roman Ambassador. If premiums had been offered for stupid plans and wild projections, I think worse could not have been offered than such as we have seen, viz. laying embargoes on the exports, to increase the produce of the country for the army; forcing people to sell their goods below the market price, in order to induce them to bring more to market; offering money with horrid penalties, in order to make folks love and esteem it; embarrassing all business, to get the more of it done; &c. &c.

Such wild, stupid, horrible, and unnatural projects, with the effects of them, discourage our people, and render the wheels of government heavy, and destroy all confidence of the people in the public counsels, much more than the real weight and burdens of the war. These bear no sort of proportion to the distresses which are produced by the madness of our counsels, and unnatural way of doing every thing. Laws ought to be conformed to the natural course of things; but we have been absurdly endeavouring to control the natural course of things, and bend it to our laws.

I think it impossible that further arguments should be necessary to prove the expediency, yea, the strong propriety, and urgent reason of dismissing at once all these most unnatural and destructive measures, these absurd scandals of human reason, and of American policy; that so our minds may be open to impressions from the true state of our case; open to the real difficulties we are under, and to the proper measures which will, by their natural operation, afford us relief. We ought to study hard for this. Perhaps we may by strong exertion, by close attention, and the blessing of God, be able to find out, that means must be adequate to their ends; that the way to restore our credit is to pay our debts; that the way to pay our debts is to get money to pay them with; that any burden laid on the whole community is safer for the whole, than when the same burden is laid on a part only; that the only way to keep the members strong and in health is, to keep the belly full of substantial food, not of husks, &c.

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But the absurdity of our measures is not all the objection I have to them. They are inadequate to their own purposes. What can it signify to plague the continent, and exhaust all the patience of our people with difficult, intricate plans of raising money, when all the plans put together, and fully executed, would not produce half, perhaps not a quarter, of the sum necessary to our prefervation? This is like bailing a leaky ship with a spoon, when buckets are necessary to keep her free. I think it would be far more natural and satisfactory to our people, to make out estimates and demands equal to our necessities, which will give this strong inducement to the efforts of each individual, viz. that it will be adequate to the purpose; that the means, however difficult, will be sufficient to produce the great ends designed. When the great demand is made known, the first question will be, Is this enough? Will this be sufficient to the purpose? An assured, affirmative answer will inspire great courage and effort, when the object is the great wish, the passionate desire of almost every individual, as is most manifestly the case with our people. It is a false delicacy, a shameful timidity, a dangerous injury to a nation, to keep them ignorant of their true circumstances and real danger, and not give them an opportunity to put the means of their safety in practice.

I am clearly of opinion, that scarce a man of any weight could be found in the Thirteen States, who would not readily and with joy pay a much larger sum than his tax would amount to, if he had reasonable hope that the distresses, oppressions, and dangers of the country could be thereby removed, a free course of justice be restored, every man’s person and property be protected, and the natural inducements of industry be favored and encouraged, and our insulting enemies be effectually opposed.

The yearly incomes of the country are much more than sufficient to do all this, if properly called into use. We have two armies in the country to seed, and the produce of the country is amply sufficient for both. The supplies of the one we are paid for, it is only the other which must be supported from our own resources; and after supplying both Edition: current; Page: [[160]] armies (if our husbandry and trade could be suffered to take their natural course) we should have large produce to spare for exportation.

In addition to all this, I am clearly of opinion that our resources are so great, that with proper management (even tho’ the war should continue seven years longer) the treasury of the Thirteen States might be filled with silver and gold coin, and be made a BANK as safe and useful as that of Amsterdam or Venice; and all this within a very short time, as may be clearly demonstrated to any body who is acquainted with the nature and constitution of this kind of subject.

The Dutch, as soon as they sound out the secret of inspiring their people with the true spirit of industry and enterprise, soon recovered their national credit, and grew amazingly rich, long before their wars with Spain ceased. We have vastly greater means in our power than they had, and want nothing but their wisdom to improve them to as great advantage. I conceive it to be very certain and manifest, that our national character, honor, and safety are yet in our own power, and depend on nothing for their full and perfect establishment, but our own wisdom and effort, and the blessing of Divine Providence.

I will conclude this Essay with one proposition, which, however much like a paradox it may appear at first sight, I think is very demonstrable, and I conceive will require little more than mere inspection for a short time, to convince every man of discernment and serious attention of its truth, viz. it would be easier and cheaper for every man of business, whether farmer, tradesman, or merchant, to pay his share of the whole annual expenditures of the public within the year, than not to pay it; i. e. he would live more easy thro’ the year, and be richer at the end of it, by paying such tax, than by not paying it. This was the great Posilethwait’s grand doctrine in England thirty years ago, and every body now sees the great advantages which would have resulted from his advice, had it then been adopted and pursued.—

“Oh! that we could know the things of our peace, in this the day of them.” God forbid they should be hid from Edition: current; Page: [[161]] our eyes. Men often look abroad for things that are at home, and seek at a distance for things that are near. I apprehend that union of sentiment and effort, in the practice of means, which it does not require any great sagacity to discover, would be quite sufficient for our safety. A plain simplicity is more to our purpose, than any depth of delusive policy.*

An honest integrity and natural prudence always create dignity, confidence, and respect. On these I would wish to build our national character, on these I would ground our defence, and in the practice of these I would hope for the divine blessing on ourselves and on our posterity.

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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.]

AS the appointment of a Financier-General, or Superintendant of the finances or public revenues, has been some time in contemplation, it may not be unacceptable to the public to see a dissertation on the nature of that high office, and the duties, powers, and privileges annexed to it, with some notes on its importance, dignity, and uses.

This is a new subject in America;* it may therefore be expected that the first essays on it will be imperfect. Nothing but experience in so immense a subject can give a full and comprehensive knowledge of all its parts, and of the duties, powers, and privileges necessary to the proper management and due execution of it. I have thought much on the subject, and find it greatly exceeds my comprehension. I can only give the public such thoughts as occur to Edition: current; Page: [[163]] me, which, without further preface or apology, I shall do with freedom, and hope they may be received with candor.

The duty of a Financier-General, I humbly conceive, is,

I. To inspect and take account of the whole finances or public revenues of the States, and the whole funds or stock out of which they are to grow; i. e. every sort of public property, all sources of all kinds out of which public monies are to be derived to supply the public treasury, and superintend all these, i. e. take due care that they are well kept, free from waste, destruction, and embezzlement, and that they be managed and improved to the best advantage.

II. To inspect and point out, arrange and put into action, the ways and means by which the necessary supplies of the public treasury may be derived from all these sources or funds, that the same be done with most ease to the subject, and safety to the States, with all that effect, decision, and expedition necessary to all public movements, and at the least expense which can be adequate to these great ends; i. e. to make estimates of the yearly expenditures, and point out the ways and means of supplies, and to arrange both in so clear and particular a manner for the inspection of Congress, that they may have at once a view of the whole and all the parts, to the end that, having such a state of all the facts and materials before them, they may be able to form the most wise and proper resolutions thereon, which the safety and well-being of the States require.

It is further necessary that this be done in such season, as to give sufficient time for the deliberations of Congress, and carrying their resolutions into effect, in the most natural and easy way, that thereby the dangers, mischiefs, Edition: current; Page: [[164]] and confusion of precipitation, hurry, and extreme urgency of these very weighty matters, may be avoided.

III. To inspect and control all officers who have the keeping, disposal, or management of each and all of said funds, to the end they may be properly directed, encouraged, checked, and supported in the discharge of their several offices, in such manner that their management, accounts, and payments may be completed with least delay and most advantage to the States.

IV. To call on the several States for such quotas as may be assessed by Congress, and to keep them advised of every thing that the demands of Congress and the public exigencies may require of them, respecting the revenue.

V. To inspect all the expenditures of the States, of every kind, to the end they may be made with the best economy, and to the utmost benefit of the public.

VI. To inspect and control all officers, concerned in the payment or expenditure of the public monies or revenues, and to demand a return of all such expenditures from such officers, with the balance of all their accounts, that so he may be enabled to keep an exact balance of all the public revenues and expenditures, ready for the inspection or information of Congress, whenever they shall call for the same.

VII. To inspect all debts due to and from the States, all bills of credit, and all treaties and contracts relating to the revenue or public monies, to the end there may be collection and payment made, with that punctuality and decision necessary to the support of the public faith, that so the States may receive no detriment from any failure or delay in this delicate and important particular.

VIII. To keep an account of the whole revenue, and all its parts, and of the whole expenditures, and all their parts, in so clear and digested a manner, as to be able, on reasonable notice, to report to Congress the state and amount of each, with the deficiency or surplusage of the revenue for purposes of government.

IX. To procure such certain documents of the whole funds or resources of the public revenue, and all their parts, and Edition: current; Page: [[165]] make himself so acquainted with the same, as to be able to point out the best ways and means of increasing the revenue, for any purposes of public safety and advantage, when Congress shall require such service from him.

X. To make discovery and report to Congress of any department of the expenditures, which are more expensive than necessary, and of any that are starved thro’ want of such supplies and allowances as are necessary.

XI. To be in all things subject to the control of Congress, and to be accountable to them only.

This view of the extensive duty of a Financier clearly discovers the nature, importance, and uses of his office. The great design of it is, to range the several sources of the public revenue in order, that the whole system of it may be clearly understood, that any part that is wanted may be at hand, that the whole may be raised with the least burden possible to the people, and be made to go as far, and produce as much benefit, as possible.

The invention of ways and means of improving the revenue, or raising public money, is not a more necessary part of the business of finance, than economy and prudence in the expenditures. Perhaps the latter is the more important and difficult of the two. For I conceive there may be found ten men who know how to get money, to one who knows how to keep it, or pay it away with proper economy and prudence; and I apprehend that our present distresses, and the exhausted state of our revenues, arise more from defects in the last of these, than the first. The natural operation of this office discovers these errors, and leads to a remedy. For,

1. It is manifest that the man, whose duty it is to find all the money which is to pay every department, will be most likely to study and introduce economy in the expenditures, and to spy out and check any excessive expense or waste.

2. It is further very natural to suppose, that when the Congress are informed with certainty of the extent of the revenue, they will calculate their expenditures within the limits of it; so that this office becomes a restraint even Edition: current; Page: [[166]] on Congress itself, if we can suppose them capable of any want of due consideration or prudence in this respect: And,

3. Every officer of expenditure will find himself under some check also, when he reflects that he must bear the penetrating eye of the man who finds all the money which he spends or pays out of his office. Further,

The powers, rights, and privileges of this great office are also obvious from the above survey of its nature and uses.

1. It appears that this office is of great extent and importance, and therefore ought to receive from every department of the States all such suitable helps, countenance, and support, as are necessary to procure and preserve its uses, proper operation, authority, and dignity.

2. That this officer ought to be kept constantly advised by Congress, of all such resolutions of that body as respect the public revenues and expenditures.

3. That he should have right to demand all accounts, and inspection of all books, which respect the public revenues and expenditures. And,

4. That he should be vested, by commission from Congress, with all the authority necessary to the full and perfect discharge of all the duties of his office, and be indulged with all the privileges necessary to the success, use, and dignity of it.

As this ground is all new and untrodden, it may be dangerous to define too particularly the duties, rights, authority, and privileges of this office. A little practice on the great and general principles on which it is founded will gradually open the particulars further necessary, which may be added by future provisions, if such shall be found expedient.

As I am ignorant of the present arrangement of the revenues and expenditures, I cannot tell how far any of the above particulars may fall within the departments already established, and have here only to add, that as far as any of them are provided for, a return only will be necessary from the subordinate officers, of such particulars as may be requisite to complete the accounts, and furnish the materials of this great office.

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From which it appears, that this office does not interfere with any other offices of the revenue or expenditures; such as the office of Treasurer or Treasury Board, Auditor of Accounts, &c. &c. This office begins where they end. This office takes the state and balance of the accounts of all the other officers, as they make up and finish them. This office arranges and brings them all into one view, and states in order every branch both of revenue and expenditure, from the aggregate of which the amount of the whole is made.

This brings into distinct and plain view, the whole stock, cash, credits, and incomes of the revenue of every kind, and also all the debts and expenses which are to be provided for and paid.

With these documents, a man endowed with the proper skill, great comprehension of mind, and natural aptitude to the subject, necessary for this great work, will be able to see the excesses and deficiencies of each branch of revenue and expenditure, and to judge in what manner every error may be corrected and reformed; and what makes this reformation easier is, that the error may be soon discovered, and the particular branch or place in which it lies be pointed out, and the natural and proper means of amendment put into direct and speedy operation, which nips the evil in the bud, before it has time to grow into such fatal magnitude, as not only to corrupt the department in which it lies, but also to spread into other contiguous departments, so as to become ruinous in its continuance, and very difficult in the cure.

Further, this great officer, with such a comprehensive view of the whole stock and resources of the revenue, will be furnished with the best advantages to consider the nature and strength of each of them, and to form such arrangements and put them all into such operation and effect, as to produce the greatest supply with the least burden to the people.

This is of mighty importance. This may be done, and often is, in such an injudicious and unnatural way, as to double the burden of the people, without increasing the supplies; and Edition: current; Page: [[168]] the worst way that perhaps ever was or could be thought of, is that which has been adopted for five years past, viz. paying the expenditures by the depreciation of the currency. This has done it indeed in some measure, but with such an inundation of calamities as are enough to draw tears.

A good Financier is much the rarest character to be found of any in the great departments of state. France has had but three in 400 years, viz. the Duke of Sully, under Henry IV. Colbert, under Louis XIV. and Mr. Neckar. England has not had one since Queen Elizabeth’s time: perhaps Lord North is equal to any that have gone before him, but his whole talents at finance are all exhausted in running his nation in debt, and contriving ways and means of paying the interest by the endless oppression of his people.

The great Postlethwait indeed, about thirty years ago, had the true genius of financiering, as appears by his various treatises on that subject; but the stupid ministry of his time had so little conception of the matter, that they did not know a Financier when they saw one, or, like the cock in the fable, did not know the value of the jewel which shined in their sight.

We rarely read in history of any wars, or other movements of expense, undertaken by any nation, but we find their finances soon fail, and then the movements (be they ever so important) must be discontinued, or starved into very trivial effect. This generally happens because they have not an able financier, who can calculate and balance the expenses and resources, and keep the latter in such effectual operation, as will be sufficient for the exigencies of the former. This calamity does not always arise from the expenses being greater than the resources; it more commonly takes its origin from some or all of the following capital errors of finance:

1. In the assessment and collection; as when the tax is not laid in season, or is so laid that it does not operate by way of equality on every part of the community; when the tax is consumed in the collection of taxes; by an over number of officers or other needless expense; by the embezzlement of the officers; &c. &c. Of this kind of error are, all free quarters of Edition: current; Page: [[169]] troops, all forcible impressing of supplies, or services for the public, &c. &c. because these bring the public burden in an over proportion on a few, by which not only the few are oppressed, but the whole community suffers. Injustice always carries damage with it; those who do not suffer, see they are liable to like injury, and of course are in fear—their peace and ease are not secure.

2. By waste or want of economy in the expenditure; as where the money is paid for purposes diverse from those for which it was granted, and appropriated; when the public movements are so ill contrived and managed, as to cost more money than is necessary; when useless projects are undertaken; when the public property is suffered to waste, decay, or perish for want of due care and proper disposal of it; want of discernment and discretion to pay the most pressing demands first, and let those debts lie unpaid, that can remain with the least damage, whenever it so happens that there is not money on hand enough to satisfy all the demands. A great deal depends on this kind of discretion, when the demands may happen to exceed the supplies, &c. &c.

3. By suffering the public credit to decay; this is an amazing waste of the public wealth; for when a man’s credit runs low, he must be in difficulty to find people that will trust him at all, cannot expect a good choice, or to be well served, and after all, over and above the interest and other douceurs, he must expect to pay heavily for the risk of trusting him. When a prodigal’s estate comes to be devoured by premiums, interest, and discount, when he begins to receive 50l. or 80l. and give security for 100l. his fortune must grow desperate soon. It is the same case with the public; and in this way no nation on earth can hold it out long. Every degree of this misery brings an increase with it, and if it cannot be stopped, a bankruptcy must ensue.

I mention these particulars only to show, that a Financier is the most natural and sure guard against these mischiefs, as well as the most able and likely person to remedy them. The man who finds all the money that is to be Edition: current; Page: [[170]] expended, is the most likely man on earth to spy out any errors in the revenue or expenditures, and to keep the public faith sacred and inviolate; as his own personal happiness, fortune, and character, will be immediately affected by these errors; and as he is supposed to be a man of the best abilities and strong attention to business, and that he devotes his whole time and powers to this branch or department only, he must be presumed to understand it the best, to inspect every part of it with the most pervading eye, to spy out the errors soonest, and to have the best ability and disposition to apply the most natural, speedy, and effectual remedy. That which is every body’s business is commonly nobody’s.

In all aggregate bodies, where many men make up a board, they can throw off the blame of any mismanagement from one to another, &c. which cannot be the case when the trust is committed to a single person. Besides, from the nature and duty, the design and uses of this office, it appears most plain and evident, that it must be the work of one mind.

Its object is so vast and complex, and the action consists in comparing, fitting, and balancing so many different things to and with each other, that it cannot be otherwise done than by the attention of a single mind. In a state of quietude, when small expenditures are necessary, little experience, skill, or economy may do; but when the expenditures grow vast, and require a strong draft on every resource of the revenue, then skill, attention, order, and method become essentially necessary. A small shed may be built without skilful workmen, but in a building which requires a thousand pieces of timber to be framed together, a head workman, of skill and attention, becomes absolutely necessary to regulate and control the whole work; in the smallest frames indeed, such a workman is very desirable and useful, tho’ not so essentially and absolutely necessary.

It follows then, that every community, every nation, every state, ought to have a Financier to control the revenues and expenditures, and preserve the public faith inviolate. Edition: current; Page: [[171]] We have tried it on five years without one, I am fully of opinion that we cannot be worsted the five next years with one; and therefore, as the quacks say of their nostrums, it will do no hurt, there is a probability of success, the expense is small, it is at least worth a trial.

As this is the first essay of the kind that has appeared here, it cannot reasonably be supposed that it should be perfect; and I hope those who find faults in this, will mend them in more perfect exhibitions of their own, that our country may reap all advantage from the best and most correct wisdom of all its inhabitants.

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REMARKS ON THE Resolution of Council, Of the 2d 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.]

I HAVE read President Reed’s defence of the resolution of Council of the 2d instant, for raising the exchange of the Continental currency from 75 to 175 for 1 of specie, or State money; but am not convinced that that resolution was grounded on the interests of this State, much less, that it was indispensably necessary in our present circumstances.

I agree perfectly in his opinion, that it is not beneath the dignity of a government to explain any public measures which may be misunderstood thro’ ignorance; but should they be misunderstood any other way, I do not pretend to say how far the dignity of government might suffer by an explanation.

I am also clearly of his opinion, that there has long been a number of persons in this city, who have fermented uneasiness, sparing neither art, nor falsehood, nor violence, to effect their purpose. We have seen uneasinesses, tumults, and ferments among our citizens rise even to the shedding of blood,* which doubtless originated with very bad men, Edition: current; Page: [[173]] and I could have wished that inquiries and prosecutions might have gone on, till the true, guilty authors could have been discovered, held up to public view, and punished; but government has found this inconvenient, so I have no more to say about it.

I will only observe, that I do not think the character of our citizens is that of uneasiness, tumult, and faction: I rather think they have exhibited an example of great meekness, of tame patience, almost bordering on stupidity. Nor am I at all convinced, that the objections that have been made to the abovesaid resolution of Council, arise at all from faction, or any disposition to impose on the unwary. When a man finds that eleven shillings out of every pound of his cash, is annihilated by a public resolution, we may allow him to be uneasy, without calling him factious.

I proceed, with all respect due to the honorable Council, to make some remarks on their defence. I have no pleasure in cavilling at the measures of government, but only wish to cast light on a subject, in which our whole State is interested. And, as I have never been concerned in factions, ferments, tumults, or riots, but ever have been a peaceable citizen, and hearty well-wisher to the true interests of our State, I expect a candid attention of my fellow-citizens to the arguments I offer.*

Edition: current; Page: [[174]]

1. The first fact alleged by the Council is, “that by the law of the State, and their own oaths, they are required to Edition: current; Page: [[175]] publish the rate of exchange the first week in every month.” This proves, I conceive, that the Council are required to Edition: current; Page: [[176]] publish the true exchange the first week in every month; but the whole city knows, that 175 for 1 was not the true exchange on the 2d instant; and the Council cannot be supposed to be ignorant of what is known to every other person in the city, and which the laws suppose them to be acquainted with, or it would be absurd to lodge the power of judgment with them.

So that their variation from the true exchange cannot be excused by any plea of ignorance. Therefore, when they say, “that they have not the same opportunity of knowing the current rate of exchange with accurate precision,” as the merchants have, I think it follows, that they ought to have inquired of the merchants, and gained the most accurate information possible, in a matter of that consequence and delicacy, in which the laws of the State, their own oaths, and the interests of the whole State, were concerned; but not that they should adopt the lowest known rate, at which they could discover that any commercial transactions had been adjusted.

The lowest rate is never the current or true rate of exchange, any more than the highest. It essentially and most manifestly differs from the true, as far as the extreme differs from the mean; a difference which the Council, on their own principles, had no right to make, as it did not, in my opinion, comport with, or satisfy, either the words or meaning of the law under which they acted. But while the obligations of the law, and their oaths, are urged, and the integrity and consciences of the Council are deeply affected; would any one suppose that the Council would publish what all the world knows to be false, and that under the sanction of an oath? Could the Council, without violating every principle of truth and veracity, declare the exchange to be 175, when there was not one person in the city but must know the contrary; Indeed I think it is bad Edition: current; Page: [[177]] enough when a Council, by any solemn act, violate their faith; but when they are hardy enough to violate their oath andveracity” too, the matter must look very serious to all good men.

Further, while we are told so much about laws of the State and oaths of office, I am led to inquire where these laws and oaths have been for several months past, during which time the exchange was constantly and gradually rising; and the Council, in the first week in each month as constantly declaring and publishing the exchange to be 75 for 1, for three successive months past, when there was not a single person in the city but must have known the contrary? Consistency in the acts and declarations of public bodies, is of great use, and much to be desired; their dignity stands mightily tarnished, and nigh unto ridicule without it.

2. Another fact adduced by the Council, is, “that the rate of exchange has been, by common consent and usage of trade, gradually rising for some time past; so that no person, in his private dealing, pays or receives at the rate of 75 for 1;” and the whole city may add, neither was it on the 2d inst. (the date of their resolution) at 175 for 1; the current exchange was known to every one to be at least 220 for 1, at that time.

The Council go on to argue, “that the people have raised it (the exchange) by common consent, and Council have only followed them, by making a declaration of what they have done.” If this allegation is true, it will justify the Council’s conclusion; but if it is not, it may be deemed a provoking, insulting attempt to impose a deception on “the unwary” public, and beneath the dignity of Council to adduce it. I will examine it with confidence, because every merchant in the city knows whether it is true or not.

The resolution of Council declares (if not expressly, at least in effect, and all the effect that it could in reason be supposed to have) that the exchange of old Continental to State money is 175 for 1. Now the people, by common consent and usage of trade, have never done this; have not raised that exchange to 175 for 1; it had never Edition: current; Page: [[178]] exceeded 75 at that time; therefore the resolution annihilated the difference between 175 and 75, i. e. 4-7ths, i. e. somewhat more than eleven shillings in the pound, of all the Continental money, which every man was possessed of at that time. The truth of these facts and observations are obvious to every merchant, and indeed to every market-woman; and I leave them to stand on their own ground, having no disposition to indulge a vein of sarcasm or ridicule on this serious subject.

I would only observe, that this fatal resolution has taken from thousands their daily bread, and ruined the fortunes of many who had capital sums of that money on hand; that all the Continental money in the treasury of the State, or due in taxes, or any other way, is reduced more than half, to the great loss and embarrassment of the public; and every man who has not paid his taxes, may now pay them with less than half the real value which those paid, whose rates were collected one week before. “And is this reasonable? Is this just?”

Further, the Council adduce this fact, viz. “that the rate of exchange has been gradually rising for some time past:” and they might have added, that the people have been gradually conforming themselves to that rise. But the case is widely different, when they make such a shocking start at once, as from 75 to 175. A man may descend from the garret to the lower floor by a flight of stairs without any damage; but were he to descend at one leap, he would probably break his neck. The feelings of too many make any further explanation of this matter quite unnecessary.

3. But the third fact adduced by the Council, and which, I suppose, is designed for a clincher, and which is to afford an argument of indispensable necessity, is this, viz. “that the State of New-Jersey had, on the 27th ult. raised their exchange to 150 for 1; and that the people of that State were pouring in their Continental money on us,” &c.

I cannot but stop here, to observe how quick the old tone is changed. It has been a long time urged by people of great judgment, that the only natural and sure way to Edition: current; Page: [[179]] prevent our being deluged by an inundation of Continental money, is, to keep the exchange of it somewhat higher here, than it was in the neighbouring States. Yet those very people who now, for this reason, force up the exchange, have, for years past, been in the bitterest manner raising an outcry against such as depreciated the currency.

It is true, indeed, that the Jersey people could bring their Continental money over Delaware, and purchase State money at 75 for 1; and it is as true, that our people could carry the Jersey money over the Delaware, and sell it at 150 for 1; and the advantage, on the whole, would be on our side; because all the Continental money which was in the Jersies at the date of their resolution, cost their people 75 for 1, and they get no more for it here. Whereas our people, who carry their State money to them, purchased it for 75, and got 150 for it.

But after all, it could be but the bubble of a day; it might furnish employment for stock-jobbers, schemers, and idle people a short time, but could not continue long; it is not possible that advantage could be taken long of different exchanges on the two sides of Delaware, whilst the communication is so very great; and after all, the difference could be but trifling.

For neither the resolution of the Jersies, nor of our State, can make the State money of either a whit more valuable, i. e. make it purchase any more hard money or any other valuable goods, than before; but the violent shock must depreciate both, as we find by experience, which is the surest evidence in matters of this nature.

But, salus populi, suprema lex. What is now to be done? Is it best to repeal the resolution? I think not. The mischief is done. A repeal will not remedy it. The Continental money has received its mortal wound. I do not think it advisable or possible to heal it. The State money follows fast after it. The exchange for hard money on the 2d instant was 3 for 1; it is now said to be 4 for 1 at least.

I think we have now no choice left, but to adopt my old doctrine, viz. “To recur to our solid substance, or real Edition: current; Page: [[180]] wealth, bidding a final farewel to all bubbles, vain expedients, and shadows.”

The present evil originates in the law, which the Council have undertaken to execute. If a law is so absurdly made as to be incapable of execution, nothing but absurdity and perplexity can arise out of it. It will lie with the Assembly in their approaching session, to repeal the law or not.

On the whole, if the Council have not increased the esteem of the public by their resolution, they are at least entitled to some compassion. They have undertaken a task that is impossible; and I imagine their difficulties would puzzle much abler heads than theirs. If a legislature should make a law that a bar of iron should be cut asunder with an ax of wood, the officer entrusted with the execution of it, might think it his duty to try; but he need not be surprised, after all his labor and chopping, to find the iron bar intire, and his ax sadly bruised.

The exchange, or operation of money, is a very nice, touchy, delicate subject; and no man can, by right or prudence, intermeddle with it, who does not understand its nature and principles. No dignity of station, or reverence of character, can secure a man against ridicule and contempt, when he comes to be knocked about by the magical effects of that all-powerful subject, when put into operation under the direction of unskilful hands.

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STRICTURES ON A Publication in the Freeman’s Journal of May 16, 1781, signed TIMOLEON.*
[First published in Philadelphia, May 23, 1781.]

IT is of no consequence to the public, whether Timoleon or myself have the blackest heart, the foulest mouth, or the most spiteful pen. I yield to him the palm in every article of personal abuse, sly innuendo, or gross scandal; I mean to consine myself to such particulars as the public have an interest in.

In my Remarks on the Resolution for raising the Exchange, I observed that the Council, in their defence, had urged that both the laws of the State, and their oaths of office, required what they had done.

I replied, that the exchange which they had published for several successive months, was not the true exchange; and therefore could not satisfy either the law or their oaths of office. Mr. T. seems to deny this, but says, the virtuous part of the community represented the exchange as various from 150 to 200 or 225. This I deny, and call on mr. T. to produce one virtuous person of the community, of Edition: current; Page: [[182]] knowledge sit to be consulted, who ever told the Council the exchange on the date of their resolution was 175; or one respectable merchant (as he goes on to assert) who ever said or agreed that the exchange in March or April last, was 75 for 1. The contrary of both is well known to every body in this city. Plain fact is here notoriously against mr. T.; for which I appeal to the whole city, who are the most competent judges.

What mr. T. asserts, and I deny, is this, viz. that the exchange of hard money was here in February, March, and April last, at 75 for 1, and in May 2d, instant, at 175 for 1. I do not begrudge mr. T. the whole credit of his fetch, viz. “that the act of Assembly does not require the Council to publish the most current rate, but simply the rate of exchange;” but whatever credit this precious subtilty may give to his ingenuity, it can afford no help to his argument; because the exchange does mean the current or usual exchange, from the force of the particle the, for which I refer to the most common English Grammar of the schools. The words are not an exchange, or any exchange, but the exchange, which cannot with any propriety mean any but that particular one which was most current or usual at the time.

But mr. T. cannot possibly understand this mystery, how a buyer can be a loser by the Council’s declaring the exchange 175. I can easily explain this matter of fact; before the date of that declaration, with 220 dollars the buyer could purchase candles or fish to the value of one hard Edition: current; Page: [[183]] dollar; but after that declaration, he must pay 500 of the same dollars for the same goods; his loss therefore is the difference between 220 and 500, i. e. 280, or something more than eleven shillings in the pound.

This is a computation grown very familiar in the city; and I cannot but wonder it should remain so long a mystery to mr. T.; for this same reason, or to use the numerical figures of the resolution (to make the matter plainer to mr. T. who discovers much mystery, and some mystery of mysteries in the matter) because that 175 dollars bring no more after the resolution, than 75 would bring before, every possessor of Cnntinental money, and of course the public treasury, loses 4-7ths of all they have on hand, and all debts due and payable in that currency.

This he confidently asserts to be a falsehood. I think he might be ashamed to deny a truth of public notoriety; but if he is really so dull as not to be able to see this, it is manifest the Council see it very plain, as is very evident by their attempt (tho’ a vain one) to obviate the mischiefs of it, in the payment of taxes, fines, &c.* and which, he says, is the real and true cause of much of the clamor against the Council’s resolution.

But in this he is very much mistaken, because the remedy adopted by the Council is void of effect, as it does not reach or remedy the mischief; for tho’ the tories and whigs too cannot pay their State money for taxes at more than 75, yet they can and daily do change their State money for Continental, and pay their taxes with much less than half the real value which those paid, who paid their taxes before the resolution was published, and this is publicly known to every body. Nor can I see any thing but personal honesty which prevents all our collectors from changing all the State money which they received before the resolution, for old Continental; Edition: current; Page: [[184]] and paying that into the treasury. This is the blessed way in which (it is the peculiar felicity of mr. T. to discover) our treasury has been enriched since the resolution.

If it still does not appear to mr. T. that the old Continental money, either in his own desk or in the treasury, is reduced to less than half the value it had before the resolution, the best way I know of to satisfy himself is, to take some of it to buy any necessaries, and he will, I doubt not, have a practical proof too strong to admit a doubt; and if in this or any other way he should happen to be convinced, I shall expect that he will publicly acknowledge it, for his own sake.

But to follow mr. T. a little further. I have said in my Remarks, that “the resolution of Council declares (if not expressly, at least in effect, and all the effect that it could in reason be supposed to have) that the exchange of old Continental to State money, is 175 for 1.” This mr. T. denies with great triumph. I must beg the reader’s attention here a moment; the words of the law are, that the Council are required to publish “the then rate of exchange between specie and Continental money, which exchange, so published, shall be the exchange of the Continental money and the State money,” &c. in which it is manifest, that the most express design of publishing the exchange of specie, was thereby to fix the exchange of the State money on a par with it; this was the effect which the legislature intended, and the very effect which the Council intended, as appears by their provision against the effects of it, in the case of taxes, fines, &c.

Yet mr. T. with great assurance asks, “What has this to do with the Council’s publication, which has not State money in contemplation?” His law logic helps him out but poorly here, viz. that the operation of the law on this publication, and not this publication itself, produced the effect; he might as well deny that a miller grinds wheat, because the millstones grind it; or that a man travels a journey on horseback, because the horse only travels; for it is very plain, that the law, without this publication, would no Edition: current; Page: [[185]] more have raised the exchange of State money, than the mill would grind the wheat without the miller to set it agoing, or the horse perform the journey without the rider on his back. I therefore conclude, that every one will be convinced that my proposition is true; and if it is true, mr. T. acknowledges that “my observation will apply.

Mr. T. among other reasons why the Council did not raise the exchange last month, gives this one, viz. the speculation at Boston and Rhode-Island improved the credit of the old Continental money here, and therefore was not to be interrupted by any disadvantageous alteration of the exchange.

This speculation was, to purchase Continental here at 220 for 1, and sell it at Boston for 75; but in the very next paragraph, he reprobates the same kind of speculation to the Jersies very severely, I suppose, because it was not so profitable. “Is this,” says he, “a traffic which public counsels are to promote and encourage?” I have no where said these speculations were good, I mentioned them as bad things; and all I said, and all my argument required, was, that they were but bubbles of a day, &c. and could not justify so dangerous and ruinous a measure, as raising the exchange to prevent their mischief, because this would make the remedy worse than the disease.

I did oppose the tender-act, which is the act in question (see my Strictures on Tender-acts, p. 128) whilst it was under consideration, with all the power I was able, and in the most public way; and therefore, in mr. T.’s opinion, my indecency,* Edition: current; Page: [[186]] as he calls it, may have some palliation But I can see no indecency in pointing out the evils or impracticabilities of a law, which the whole community must suffer; if this is done in such a way as tends to a remedy. The numberless instances of private distress, as well as the starving condition of all the public departments, and especially the unprovided state of the army, were my great inducements to write my Remarks, and thereby expose the errors which at least aggravated our calamities. I have no ill will to the Council, I have none to the Assembly; but I wish the wisdom of both may increase, and all their errors may be mended.

I cannot forbear animadverting a little on the rancorous, malignant conclusion of mr. T. in his invective against some of our citizens. I think a little decency to the place which gives him bread, might have induced him to spare his black epithets. It is a foul bird that besmears his own nest. But if he intends (as perhaps he does) to apply any of his detestable characters to me personally, I have only to aver, they are sheer abuse, without the least foundation of truth.

I did, indeed, on repeated advices of the great distress of Boston, for flour and iron, in 1777, load a vessel of my own with a cargo of both, and sailed for Boston, but was (on April 6) unfortunately taken on the passage, by the Orpheus, English frigate, and carried into Rhode-Island, where, after a month’s imprisonment, I was released on exchange, having lost my whole vessel and cargo, to the amount of about 2000l. hard money; for which I never had, nor do expect ever to have, the least compensation from them.

I also did remain in the city when the British troops captured it, having, among other reasons, a child in the smallpox at the time, who could not be removed; but it is not true that I enjoyed the least friendly or considential intercourse with them or their adherents.

I spent three months of the time in visiting the American prisoners in the gaols here, and procuring and carrying to their relief, such sood and clothing as I could collect, at a time when their distresses were beyond all description, and when it was deemed a crime to show compassion to Edition: current; Page: [[187]] them; and on the 6th of February, 1778 (long before there was any probability of an evacuation of the city) I was committed to gaol, and suffered not a collusive, but a most severe, confinement of 132 days, without being able, by every possible application,* to obtain any knowledge of the cause of my confinement; but the presumption generally admitted was, that my constant and careful attendance on the American prisoners was thought to imply too strong an attachment to Americans, to be compatible with either the duty or protection of a British subject.

As to what mr. T. very malignantly suggests about reviling government, evading resolutions of committees, and croaking discontent, I beg leave to observe, that I never have opposed either projects of committees, or measures of government, except such as have since, on the fullest experiment, and the plainest demonstration of fact, been reprobated Edition: current; Page: [[188]] by our gravest counsels, and condemned by the general consent of Americans as bad policy; such as limitations of prices, sorcing sales of private property, tender-acts, emitting deluges of paper currency, fixing the value of paper currency by law, and other absurdities which have involved America in greater calamities than the British arms.

And I freely submit it to every found American, whether I may not, with good right, and without vanity, boast of it as an instance and proof of sound judgment and most genuine patriotism, that I have early discovered and opposed those ill-judged and pernicious expedients, which, by the general voice of America, are now execrated as the undoubted sources and causes of our present corrupted morality, enervated state of defence, ruin of public faith, prostitution of national character, loss of the confidence of our friends, contempt and disgrace abroad, and confusion at home.

I have, indeed, with great reluctance, opposed popular prejudices, when they were incapable of being controlled. But I freely submit it to my fellow-citizens, whether time and fact have not ever justified my conclusions, with this only difference, that the consequences have been verified in fact in a much stronger degree, and more aggravated mischief, than I have delineated. If one material instance of my opposition to projects of committees, or measures of government, different from this, can be produced, I am content to stand corrected in the face of the public; and I am consident my fellow-citizens will not suffer me to be oppressed, because I have told them the truth before every one could see it.

I never once expressed or selt any dissatisfaction to the great cause of American liberty, but ever wished and promoted its success, as far as was in my power. The truth of every part of this declaration I do aver on my honor, and have the fullest proof of the facts, and doubt not my fellow-citizens will consider me as a much-injured man, and give full credit to what I say.

I do at least call on mr. T. to produce the least spark of proof of the contrary. However injurious I consider his malignity, I am yet less affected by his publication, than I Edition: current; Page: [[189]] should have been by his secret whispers, which I could have no opportunity to contradict.

I humbly beg leave to suggest further here, that out of these very facts, so spitefully misrepresented by mr. T. when they are candidly considered, arises a stronger proof of my attachment to the American cause, than most whigs are able to exhibit, and a much stronger proof than any which I even heard mr. T. ever has exhibited of his whiggism.

My writings on finance are open to every body, and have met the approbation of many of the greatest men in America; and I believe mr. T. begins to feel the force of them: for I find he begins to ‘hope we shall have spirit enough to enforce a hard money tax,’ which has long made a part of my scheme of finance, and which mr. T. has constantly reprobated, till now. But this does not flatter my vanity much; for I believe he might as well ‘jump out of the garret into the street,’ as write on the subject of finance at all.

I have only to beg the reader to keep his eye steadily on the facts, not on the colorings, of mr. T. or myself, and from those facts to form his judgment. Facts are hardy, stubborn things, which mr. T. or I may color indeed, but neither of us can break or bend them; such as follow, viz.

1. Was the current exchange of specie in February, March, and April last, 75 for 1; or was it 175 for 1 on the 2d instant, as declared by Council?

2. Was the exchange required by law to be published, an or any exchange, and not the current exchange, as mr. T. quibbles?

3. Did the Council’s declaring the exchange of specie at 175, produce the same effect as declaring the exchange of State money at 175 would have done?

4. Did the Council’s declaring the exchange of 75 in February, March, and April, and 175 in May, which was not the then current rate of exchange, satisfy either the words of the law, or their oaths of office?

Edition: current; Page: [[190]]

5. Did any respectable merchants, on consultation, inform the Council that the current exchange in February, March, and April last, was 75, or 175 on the 2d instant?

6. Did the declaration of the Council on the 2d instant so operate on the old Continental money, as to reduce the value of it to less than half, both in private hands and in the public treasury?

7. Did the raising the exchange in the Jersies afford reasons by any means sufficient to justify our following so fatal an example?

These are some of the principal facts contested between mr. T. and myself. They are all matters of public notoriety. The public are not all beholden either to mr. T. or myself, for the knowledge of any of them, except the 5th, of which we must depend on mr. T. for the necessary proof.

If the above facts and reasonings are true, I think it will follow, that the poison which mr. T. is so much concerned to find an antidote for, will prove to be these poison truths, which he fears will have an operation to his disadvantage. I am sorry, too, that they ever were truths. I am quite of opinion they are a sort of poison truths, which have done, and I fear will do, much hurt; and therefore I hope I may be excused for putting my mark of disapprobation on them.

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STRICTURES ON Two Publications in the Freeman’s Journal of May 30, 1781, signed PHOCION, AND IMPARTIAL.*
[First published in Philadelphia, May 23, 1781.]

THESE authors, together with Timoleon, are the sons of darkness. The printers are not at liberty to give up their names. I take Phocion and Timoleon to be the same person. But as I suppose they are ashamed to be seen, I do not mean to disoblige them by hauling them into light, but hope, whilst it is impossible for me to know who they are, it will be deemed very absurd to suppose any thing I write, designed for a personal application to either of them. Phocion says, that “the Citizen has insinuated that no merchant could have advised the continuance of the exchange at 75 in April last.” This is not true, Phocion; you do depart from the fact; and you know you Edition: current; Page: [[192]] do. Had you kept to the fact, your sentence would have stood thus, viz. The Citizen denies that any respectable merchants ever infarmed the Council that the true or current exchange of specie was 75 in April last.

On this I have challenged Timoleon, and now challenge Phocion. It is mean for you, Phocion, to sneak out from the point in question, by such an artful but pitiful evasion. A man of character would be ashamed of it; but it is easier to blush in the dark than before company.

You go on to mention mr. Robert Morris, as having given his opinion and advice to publish “the exchange in April at 75.” I have reason to believe that this is not true; that mr. Robert Morris never was consulted in April last, nor did give any opinion or advice about publishing the exchange so late as April last; and that his opinion at that time was decidedly for publishing the exchange as high as the truth, if it was determined to publish it at all.

Mr. Phocion has called up mr. Morris’s name, which obliges me to do the same. Mr. Morris is easily consulted, and will doubtless inform, if desired, what he did say on the subject to which I refer.

At an earlier period, say the beginning of February or March, when the exchange stood with little variation, and the subsequent rise of it was not foreseen; when the effects of the tender law could not be known; many merchants, and mr. Morris among them, might think it dangerous to shock the then state of our trade and currency by any unnatural and sudden start of the exchange, and might give it as their opinion and advice to publish it at 75. But if this is admitted ever so true, it does not follow that any of them ever meant to intimate thereby, that the true exchange Edition: current; Page: [[193]] even in February or March, much less in April last, was 75.

Therefore, the whole matter does not contain any the least contradiction to any thing which I have asserted, is therefore a manifest departure from the fact in question, and of course is just so much foreign matter lugged in for the mere purpose of artful shuffle and deception.

Mr. Phocion, you must stick better to the point; it is shameful to start, shuffle, and evade the true matter which labours at bar; you must keep to the fact; if you do not do this for yourself, I will do it for you; for I can and will hold you so close, that it shall not be in your power to squirm out of the grasp which pinches you. Farewell.

Now mr. Impartial calls for my attention a moment. It would be hard to take no notice of this man, who seems to be boiling over with gallish matter, and to have taken great pains to scrape together a considerable number of very hard, black words, suitable to express it. It is easy to see what sort of a blowing genius this is, by only casting an eye over his “crude revilements, villanies, hollow principles, pestilent spirit, jaundiced eyes, feculencies of wealth, execrable characters, stream of discord, Sodom, false patriot, because jealous, sneer of the States, disappointment and malice, which are immortal with the wicked after their death,” to which may be added his poor old hackneyed word, “junto,” which he has honored with large employment in this service.

But I must beg to be excused from following him thro’ such a foul thicket of hard names, coarse scurrility, and low dirt. I can easily believe he is not acquainted with President Reed, tho’ I cannot so easily admit that he is acquainted with his government, yet it is very clear he means to defend it; but as he seems to be very scant of matter, and barren of argument, it may be deemed a good-natured action to help him out a little. We generally judge of our governors as we do of our carpenters, by the goodness of their work when it is done.

I will therefore attempt to lay down some general rules, marks, or signs, by which a good or bad government may Edition: current; Page: [[194]] be distinguished; by the help of which mr. Impartial may, if he pleases, elucidate and embellish the government of his hero, and support it with some kind of argument, which will probably have more weight with the public, than any loud-sounding, hollow encomiums whatever.

1. When the laws protect the persons and property of the subject, the government is good: but it must be weak or wicked, when the laws are so framed, as in their operation to injure and oppress the subject in his person or estate.

2. When the laws are held in general reverence by the people, the government is good: but it must be bad, when the laws are generally considered as iniquitous, and execrated as such.

3. When the laws restrain wicked men, and support, protect, and encourage honesty, upright dealings, and industry, the government is good: but when the laws let all the rogues in the community loose on the honest and industrious citizen, the government must be very weak or wicked.

4. When men of grave wisdom, proper abilities, and known integrity, are put into office, the government is good: but when we see men of wild projection, doubtful morals, and inadequate abilities, crowding themselves by address and corruption into office, the confidence of the people in the government must be lost, and the administration itself must be very weak.

5. When the laws are made a rule of duty, and bulwark of safety and protection to the subject, the government is good: but when we see people imprisoned, persecuted, and ruined, without trial, conviction, or a day in court, the administration will be deemed bad. The worst man that ever lived has a right to a day in court, to a cool hearing, and an opportunity to say, by himself or counsel, all which he fairly can for himself.

6. When the laws are gravely administered by the proper officers, the government is good: but when mobs, riots, and insurrections infest the community, and disturb the public peace; when the force of the community is put under any other direction than that of the law; the government becomes dangerous, and all security is lost.

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7. When the forces and resources of a State are so modelled, put into order, and under such control, that both may be called into action and use, when, and to such degree as the public safety requires, the government is good: but when the public debts are unliquidated or unpaid, the army ill-supplied or ill-paid, the force of the State dwindling away, and the means of preservation lost, the administration must be amazingly bad, and the State in a condition of most alarming danger.

8. When the trade, agriculture, and mechanic arts, those great sources of, not the wealth only, but even morality, of a country, are properly encouraged, the government is good: but when we see our merchants drove, by the oppression of the laws, or absurdity of administration, out of the State, and the farmers and tradesmen following them with their produce and fabrics, the government must be bad indeed.

9. When the dignity of public boards, and the personal respectability of public men, are well kept up in the minds of the people, the government is good: but when the public boards are execrated as wanting common honesty or prudence, and public men cursed, hated, and despised, as void of honor, truth, skill, and uprightness, the government must be bad.

10. When we see the officers of government carefully attending to the forms, decisions, and spirit of the laws, which secure the liberty of the subject, the government is good: but when we see officers in the great departments eagerly and impatiently grasping at enormous, dangerous, and arbitrary powers, attempting to deprive the subject of the rights of a jury, the habeas corpus, and other essential legal forms of process and trial, we have reason to apprehend the government is bad. These are the very tyrannies of the British court, and are ranked among the capital articles of complaint, on which we ground our war against them, and separation from them.

11. A good government is willing to come to the light, and to explain the public movements to the understandings of the subject: bad governments are more impatient of examination, Edition: current; Page: [[196]] are apt to complain of the liberty of the press, and when remarks are made on their measures with ever so much propriety, truth, and modesty, they rarely attend with candor, but endeavour to divert the attention of the public by artful evasions of the matter in question, and instead of answers, entertain their fellow-citizens either with fulsome rapture of panegyric, or declamations of personal abuse, or foul scurrility, neither of which has the most distant relation to the grievances complained of, and which require their explanation.

It may be objected that the above rules, as far as they relate to the laws, will not apply, because it luckily happens that our constitution does not vest the President with the power of legislation; it is equally true, that our constitution does not empower the President to raise mobs, and appoint committees, and therefore the objection may go to that part too. Upon this I have only to observe, that the whole management of the public affairs, which is supposed to be under the great influence of any prime mover, is commonly called the administration or government of such a minister.

But as I am not going to make use of any of these rules for myself, but wrote them solely for the benefit of mr. Impartial, he or any body else that reads them, may leave out all which he thinks not for his purpose, and make use of, and apply, such of them only as he thinks apropos.

On the whole I have to observe to Timoleon, Phocion, Impartial, and every other writer, that if any of them are disposed to object to the truth of any fact or principle which I have advanced or may advance, and will state their objections fairly and candidly, I shall have pleasure in giving them all the information in my power; but if they are disposed to run off in a tangent, thro’ the endless wilds of abuse, personal reflection, and scurrility, in which the public can have no concern, I must beg leave to inform them once for all, that I think it inconsistent with the respect I owe the public, and the dignity of character I mean to assume to myself, to follow them in such a dirty career. I have neither talents nor taste for that kind of writing.

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I mean to address the understanding of my readers, not their passions, their biasses, much less their corrupt taste. I mean to write on very serious, important subjects, and wish to convince and inform serious minds. I have no more ambition to be thought a witling, a punster, or sharp dealer in squibs or innuendoes, than I have to be reputed an able bruiser, a sly stabber, or an accomplished assassin.

Facts and principles are my only objects, and the public good the great end I have in view, and it is painful to me to be diverted from my course by objects of low wit, seurrility, or scandal, which can only raise a laugh, or a grin, without the least advantage to the public.

Since writing the above, I find mr. Phocion begins to acknowledge and mend his errors. I doubt not he was compelled to this by force of very strong conviction. It is human to err, it is honorable to own and correct an error, it is diabolical to persist in an error after conviction. I am rejoiced to see so honorable a motion in mr. Phocion, and I hope he will go on in the good way, till all his errors and mistakes are corrected.*

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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.]

I. THE supreme authority of any State must have power enough to effect the ends of its appointment, otherwise these ends cannot be answered, and effectually secured; at best they are precarious.—But at the same time,

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II. The supreme authority ought to be so limited and checked, if possible, as to prevent the abuse of power, or the exercise of powers that are not necessary to the ends of its appointment, Edition: current; Page: [[200]] but hurtful and oppressive to the subject;—but to limit a supreme authority so far as to diminish its dignity, or lessen its power of doing good, would be to destroy or at least to corrupt it, and render it ineffectual to its ends.

III. A number of sovereign States uniting into one Commonwealth, and appointing a supreme power to manage the affairs of the union, do necessarily and unavoidably part with and transfer over to such supreme power, so much of their own sovereignty, as is necessary to render the ends of the union effectual, otherwise their confederation will be an union without bands of union, like a cask without hoops, that may and probably will fall to pieces, as soon as it is put to any exercise which requires strength.

In like manner, every member of civil society parts with many of his natural rights, that he may enjoy the rest in greater security under the protection of society.

The union of the Thirteen States of America is of mighty consequence to the security, sovereignty, and even liberty of each of them, and of all the individuals who compose them; united under a natural, well adjusted, and effectual constitution, they are a strong, rich, growing power, with great resources and means of defence, which no foreign power will easily attempt to invade or insult; they may easily command respect.

As their exports are mostly either raw materials or provisions, and their imports mostly finished goods, their trade becomes a capital object with every manufacturing nation of Europe, and all the southern colonies of America; their friendship and trade will of course be courted, and each power in amity with them will contribute to their security.

Their union is of great moment in another respect; they thereby form a superintending power among themselves, that can moderate and terminate disputes that may arise between different States, restrain intestine violence, and prevent any recourse to the dreadful decision of the sword.

I do not mean here to go into a detail of all the advantages of our union; they offer themselves on every view, Edition: current; Page: [[201]] and are important enough to engage every honest, prudent mind, to secure and establish that union by every possible method, that we may enjoy the full benefit of it, and be rendered happy and safe under the protection it affords.

This union, however important, cannot be supported without a constitution founded on principles of natural truth, fitness, and utility. If there is one article wrong in such constitution, it will discover itself in practice, by its baleful operation, and destroy or at least injure the union.

Many nations have been ruined by the errors of their political constitutions. Such errors first introduce wrongs and injuries, which soon breed discontents, which gradually work up into mortal hatred and resentments; hence inveterate parties are formed, which of course make the whole community a house divided against itself, which soon falls either a prey to some enemies without, who watch to devour them, or else crumble into their original constituent parts, and lose all respectability, strength, and security.

It is as physically impossible to secure to civil society, good cement of union, duration, and security, without a constitution founded on principles of natural fitness and right, as to raise timbers into a strong, compact building, which have not been framed upon true geometric principles; for if you cut one beam a foot too long or too short, not all the authority and all the force of all the carpenters can ever get it into its place, and make it fit with proper symmetry there.

As the fate then of all governments depends much on their political constitutions, they become an object of mighty moment to the happiness and well-being of society; and as the framing of such a constitution requires great knowledge of the rights of men and societies, as well as of the interests, circumstances, and even prejudices of the several parts of the community or commonwealth, for which it is intended; it becomes a very complex subject, and of course requires great steadiness and comprehension of thought, as well as great knowledge of men and things, to do it properly. I shall, however, attempt Edition: current; Page: [[202]] it with my best abilities, and hope from the candor of the public to escape censure, if I cannot merit praise.

I begin with my first and great principle, viz. That the constitution must vest powers in every department sufficient to secure and make effectual the ends of it. The supreme authority must have the power of making war and peace—of appointing armies and navies—of appointing officers both civil and military—of making contracts—of emitting, coining, and borrowing money—of regulating trade—of making treaties with foreign powers—of establishing post offices—and in short of doing every thing which the well-being of the Commonwealth may require, and which is not compatible to any particular State, all of which require money, and cannot possibly be made effectual without it.

They must therefore of necessity be vested with a power of taxation. I know this is a most important and weighty trust, a dreadful engine of oppression, tyranny, and injury, when ill used; yet, from the necessity of the case, it must be admitted.

For to give a supreme authority a power of making contracts, without any power of payment—of appointing officers civil and military, without money to pay them—a power to build ships, without any money to do it with—a power of emitting money, without any power to redeem it—or of borrowing money, without any power to make payment, &c. &c. such solecisms in government, are so nugatory and absurd, that I really think to offer further arguments on the subject, would be to insult the understanding of my readers.

To make all these payments dependent on the votes of thirteen popular assemblies, who will undertake to judge of the propriety of every contract and every occasion of money, and grant or withhold supplies according to their opinion, whilst at the same time, the operations of the whole may be stopped by the vote of a single one of them, is absurd; for this renders all supplies so precarious, and the public credit so extremely uncertain, as must in its nature render all efforts in war, and all regular administration in peace, Edition: current; Page: [[203]] utterly impracticable, as well as most pointedly ridiculous. Is there a man to be found, who would lend money, or render personal services, or make contracts on such precarious security? of this we have a proof of fact, the strongest of all proofs, a fatal experience, the surest tho’ severest of all demonstrations, which renders all other proof or argument on this subject quite unnecessary.

The present broken state of our finances—public debts and bankruptcies—enormous and ridiculous depreciation of public securities—with the total annihilation of our public credit—prove beyond all contradiction the vanity of all recourse to the several Assemblies of the States. The recent instance of the duty of 5 per cent. on imported goods, struck dead, and the bankruptcies which ensued on the single vote of Rhode-Island, affords another proof, of what it is certain may be done again in like circumstances.

I have another reason why a power of taxation or of raising money, ought to be vested in the supreme authority of our commonwealth, viz. the monies necessary for the public ought to be raised by a duty imposed on imported goods, not a bare 5 per cent. or any other per cent. on all imported goods indiscriminately, but a duty much heavier on all articles of luxury or mere ornament, and which are consumed principally by the rich or prodigal part of the community, such as silks of all sorts, muslins, cambricks, lawns, superfine cloths, spirits, wines, &c. &c.

Such an impost would ease the husbandman, the mechanic, and the poor; would have all the practical effects of a sumptuary law; would mend the economy, and increase the industry, of the community; would be collected without the shocking circumstances of collectors and their warrants; and make the quantity of tax paid, always depend on the choice of the person who pays it.

This tax can be laid by the supreme authority much more conveniently than by the particular Assemblies, and would in no case be subject to their repeals or modifications; and of course the public credit would never be dependent on, or liable to bankruptcy by the humors of any particular Assembly.—In an Essay on Finance, which I design soon Edition: current; Page: [[204]] to offer to the public, this subject will be treated more fully. (See my Sixth Essay on Free Trade and Finance, p. 229.)

The delegates which are to form that august body, which are to hold and exercise the supreme authority, ought to be appointed by the States in any manner they please; in which they should not be limited by any restrictions; their own dignity and the weight they will hold in the great public councils, will always depend on the abilities of the persons they appoint to represent them there; and if they are wise enough to choose men of sufficient abilities, and respectable characters, men of sound sense, extensive knowledge, gravity, and integrity, they will reap the honor and advantage of such wisdom.

But if they are fools enough to appoint men of trifling or vile characters, of mean abilities, faulty morals, or despicable ignorance, they must reap the fruits of such folly, and content themselves to have no weight, dignity, or esteem in the public councils; and what is more to be lamented by the Commonwealth, to do no good there.

I have no objection to the States electing and recalling their delegates as often as they please, but think it hard and very injurious both to them and the Commonwealth, that they should be obliged to discontinue them after three years’ service, if they find them on that trial to be men of sufficient integrity and abilities; a man of that experience is certainly much more qualified to serve in the place, than a new member of equal good character can be; experience makes perfect in every kind of business—old, experienced statesmen, of tried and approved integrity and abilities, are a great blessing to a State—they acquire great authority and esteem as well as wisdom, and very much contribute to keep the system of government in good and salutary order; and this furnishes the strongest reason why they should be continued in the service, on Plato’s great maxim, that “the man best qualified to serve, ought to be appointed”.

I am sorry to see a contrary maxim adopted in our American counsels; to make the highest reason that can be given for continuing a man in the public administration, assigned as a constitutional and absolute reason for turning him out, Edition: current; Page: [[205]] seems to me to be a solecism of a piece with many other reforms, by which we set out to surprise the world with our wisdom.

If we should adopt this maxim in the common affairs of life, it would be found inconvenient, e. g. if we should make it a part of our constitution, that a man who has served a three years’ apprenticeship to the trade of a tailor or shoemaker, should be obliged to discontinue that business for the three successive years, I am of opinion the country would soon be cleared of good shoemakers and tailors.—Men are no more born statesmen than shoemakers or tailors—Experience is equally necessary to perfection in both.

It seems to me that a man’s inducements to qualify himself for a public employment, and make himself master of it, must be much discouraged by this consideration, that let him take whatever pains to qualify himself in the best manner, he must be shortly turned out, and of course it would be of more consequence to him, to turn his attention to some other business, which he might adopt when his present appointment should expire; and by this means the Commonwealth is in danger of losing the zeal, industry, and shining abilities, as well as services, of their most accomplished and valuable men.

I hear that the state of Georgia has improved on this blessed principle, and limited the continuance of their governors to one year; the consequence is, they have already the ghosts of departed governors stalking about in every part of their State, and growing more plenty every year; and as the price of every thing is reduced by its plenty, I can suppose governors will soon be very low there.

This doctrine of rotation was first proposed by some sprightly geniuses of brilliant politics, with this cogent reason; that by introducing a rotation in the public offices, we should have a great number of men trained up to public service; but it appears to me that it will be more likely to produce many jacks at all trades, but good at none.

I think that frequent elections are a sufficient security against the continuance of men in public office whose conduct is not approved, and there can be no reason for excluding Edition: current; Page: [[206]] those whose conduct is approved, and who are allowed to be better qualified than any men who can be found to supply their places.

Another great object of government, is the apportionment of burdens and benefits; for if a greater quota of burden, or a less quota of benefit than is just and right, be allotted to any State, this ill apportionment will be an everlasting source of uneasiness and discontent. In the first case, the over-burdened State will complain; in the last case, all the States, whose quota of benefit is under-rated, will be uneasy; and this is a case of such delicacy, that it cannot be safely trusted to the arbitrary opinion or judgment of any body of men however august.

Some natural principle of confessed equity, and which can be reduced to a certainty, ought, if possible, to be found and adopted; for it is of the highest moment to the Commonwealth, to obviate, and, if possible, wholly to take away, such a fruitful and common source of infinite disputes, as that of apportionment of quotas has ever proved in all States of the earth.

The value of lands may be a good rule; but the ascertainment of that value is impracticable; no assessment can be made which will not be liable to exception and debate—to adopt a good rule in any thing which is impracticable, is absurd; for it is physically impossible that any thing should be good for practice, which cannot be practised at all;—but if the value of lands was capable of certain assessment, yet to adopt that value as a rule of apportionment of quotas, and at the same time to except from valuation large tracts of sundry States of immense value, which have all been defended by the joint arms of the whole Empire, and for the defence of which no additional quota of supply is to be demanded of those States, to whom such lands are secured by such joint efforts of the States, is in its nature unreasonable, and will open a door for great complaint.

It is plain without argument, that such States ought either to make grants to the Commonwealth of such tracts of defended territory, or sell as much of them as will pay their proper quota of defence, and pay such sums into the public Edition: current; Page: [[207]] treasury; and this ought to be done, let what rule of quota soever be adopted with respect to the cultivated part of the United States; for no proposition of natural right and justice can be plainer than this, that every part of valuable property which is defended, ought to contribute its quota of supply for that defence.

If then the value of cultivated lands is found to be an impracticable rule of apportionment of quotas, we have to seek for some other, equally just and less exceptionable.

It appears to me, that the number of living souls or human persons of whatever age, sex, or condition, will afford us a rule or measure of apportionment which will for ever increase and decrease with the real wealth of the States, and will of course be a perpetual rule, not capable of corruption by any circumstances of future time; which is of vast consideration in forming a constitution which is designed for perpetual duration, and which will in its nature be as just as to the inhabited parts of each State, as that of the value of lands, or any other that has or can be mentioned.

Land takes its value not merely from the goodness of its soil, but from innumerable other relative advantages, among which the population of the country may be considered as principal; as lands in a full-settled country will always (cæteris paribus) bring more than lands in thin settlements—On this principle, when the inhabitants of Russia, Poland, &c. sell real estates, they do not value them as we do, by the number of acres, but by the number of people who live on them.

Where any piece of land has many advantages, many people will crowd there to obtain them; which will create many competitors for the purchase of it; which will of course raise the price. Where there are fewer advantages, there will be fewer competitors, and of course a less price; and these two things will for ever be proportionate to each other, and of course the one will always be a sure index of the other.

The only considerable objection I have ever heard to this, is, that the quality of inhabitants differs in the different Edition: current; Page: [[208]] States, and it is not reasonable that the black slaves in the southern States should be estimated on a par with the white freemen in the northern States. To discuss this question fairly, I think it will be just to estimate the neat value of the labor of both; and if it shall appear that the labor of the black person produces as much neat wealth to the southern State, as the labor of the white person does to the northern State, I think it will follow plainly, that they are equally useful inhabitants in point of wealth; and therefore in the case before us, should be estimated alike.

And if the amazing profits which the southern planters boast of receiving from the labor of their slaves on their plantations, are real, the southern people have greatly the advantage in this kind of estimation, and as this objection comes principally from the southward, I should suppose that the gentlemen from that part would blush to urge it any further.

That the supreme authority should be vested with powers to terminate and finally decide controversies arising between different States, I take it, will be universally admitted, but I humbly apprehend that an appeal from the first instance of trial ought to be admitted in causes of great moment, on the same reasons that such appeals are admitted in all the States of Europe. It is well known to all men versed in courts, that the first hearing of a cause, rather gives an opening to that evidence and reason which ought to decide it, than such a full examination and thorough discussion, as should always precede a final judgment, in causes of national consequence.—A detail of reasons might be added, which I deem it unnecessary to enlarge on here.

The supreme authority ought to have a power of peace and war, and forming treaties and alliances with all foreign powers; which implies a necessity of their also having sufficient powers to enforce the obedience of all subjects of the United States to such treaties and alliances; with full powers to unite the force of the States; and direct its operations in war; and to punish all transgressors in all these respects; otherwise, by the imprudence of a few, the whole Commonwealth may be embroiled with foreign Edition: current; Page: [[209]] powers, and the operations of war may be rendered useless, or fail much of their due effect.

All these I conceive will be easily granted, especially the latter, as the power of Congress to appoint and direct the army and navy in war, with all departments thereto belonging, and punishing delinquents in them all, is already admitted into practice in the course of the present unhappy war, in which we have been long engaged.

II. But now the great and most difficult part of this weighty subject remains to be considered, viz. how these supreme powers are to be constituted in such manner that they may be able to exercise with full force and effect, the vast authorities committed to them, for the good and well-being of the United States, and yet be so checked and restrained from exercising them to the injury and ruin of the States, that we may with safety trust them with a commission of such vast magnitude;—and may Almighty wisdom direct my pen in this arduous discussion.

1. The men who compose this important council, must be delegated from all the States; and, of course, the hope of approbation and continuance of honors, will naturally stimulate them to act right, and to please; the dread of censure and disgrace will naturally operate as a check to restrain them from improper behaviour: but however natural and forcible these motives may be, we find by sad experience, they are not always strong enough to produce the effects we expect and wish from them.

It is to be wished that none might be appointed that were not fit and adequate to this weighty business; but a little knowledge of human nature, and a little acquaintance with the political history of mankind, will soon teach us that this is not to be expected.

The representatives appointed by popular elections are commonly not only the legal, but real, substantial representatives of their electors, i. e. there will commonly be about the saine proportion of grave, sound, well-qualified men,—trifling, desultory men,—wild or knavish schemers,—and dull, ignorant fools, in the delegated assembly, as in the body of electors.

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I know of no way to help this; such delegates must be admitted, as the States are pleased to send; and all that can be done, is, when they get together, to make the best of them.

We will suppose then they are all met in Congress, clothed with that vast authority which it is necessary to the well-being, and even existence, of the union, that they should be vested with; how shall we empower them to do all necessary and effectual good, and restrain them from doing hurt? To do this properly, I think we must recur to those natural motives of action, those feelings and apprehensions, which usually occur to the mind at the very time of action; for distant consequences, however weighty, are often too much disregarded.

Truth loves light, and is vindicated by it. Wrong shrouds itself in darkness, and is supported by delusion. An honest, well-qualified man loves light, can bear close examination and critical inquiry, and is best pleased when he is most thoroughly understood: a man of corrupt design, or a fool of no design, hates close examination and critical inquiry; the knavery of the one, and the ignorance of the other, are discovered by it, and they both usually grow uneasy, before the investigation is half done. I do not believe there is a more natural truth in the world, than that divine one of our Saviour,he that doth truth, cometh to the light.” I would therefore recommend that mode of deliberation, which will naturally bring on the most thorough and critical discussion of the subject, previous to passing any act; and for that purpose humbly propose,

2. That the Congress shall consist of two chambers, an upper and lower house, or senate and commons, with the concurrence of both necessary to every act; and that every State send one or more delegates to each house: this will subject every act to two discussions before two distinct chambers of men equally qualified for the debate, equally masters of the subject, and of equal authority in the decision.

These two houses will be governed by the same natural motives and interests, viz. the good of the Commonwealth, and the approbation of the people. Whilst, at the same Edition: current; Page: [[211]] time, the emulation naturally arising between them, will induce a very critical and sharp-sighted inspection into the motions of each other. Their different opinions will bring on conferences between the two houses, in which the whole subject will be exhausted in arguments pro and con, and shame will be the portion of obstinate, convicted error.

Under these circumstances, a man of ignorance or evil design will be afraid to impose on the credulity, inattention, or confidence of his house, by introducing any corrupt or indigested proposition, which he knows he must be called on to defend against the severe scrutiny and poignant objections of the other house. I do not believe the many hurtful and foolish legislative acts which first or last have injured all the States on earth, have originated so much in corruption as indolence, ignorance, and a want of a full comprehension of the subject, which a full, prying, and emulous discussion would tend in a great measure to remove: this naturally rouses the lazy and idle, who hate the pain of close thinking; animates the ambitious to excel in policy and argument; and excites the whole to support the dignity of their house, and vindicate their own propositions.

I am not of opinion that bodies of elective men, which usually compose Parliaments, Diets, Assemblies, Congresses, &c. are commonly dishonest; but I believe it rarely happens that there are not designing men among them; and I think it would be much more difficult for them to unite their partisans in two houses, and corrupt or deceive them both, than to carry on their designs where there is but one unalarmed, unapprehensive house to be managed; and as there is no hope of making these bad men good, the best policy is to embarrass them, and make their work as difficult as possible.

In these assemblies are frequently to be found sanguine men, upright enough indeed, but of strong, wild projection, whose brains are always teeming with Utopian, chimerical plans, and political whims, very destructive to society. I hardly know a greater evil than to have the supreme counsels of a Nation played off on such men’s wires; such baseless Edition: current; Page: [[212]] visions at best end in darkness, and the dance, tho’ easy and merry enough at first, rarely fails to plunge the credulous, simple followers into sloughs and bogs at last.

Nothing can tend more effectually to obviate these evils, and to mortify and cure such maggotty brains, than to see the absurdity of their projects exposed by the several arguments and keen satire which a full, emulous, and spirited discussion of the subject will naturally produce: we have had enough of these geniuses in the short course of our politics, both in our national and provincial councils, and have selt enough of their evil effects, to induce us to wish for any good method to keep ourselves clear of them in future.

The consultations and decisions of national councils are so very important, that the fate of millions depends on them; therefore no man ought to speak in such assemblies, without considering that the fate of millions hangs on his tongue,—and of course a man can have no right in such august councils to utter indigested sentiments, or indulge himself in sudden, unexamined slights of thought; his most tried and improved abilities are due to the State, who have trusted him with their most important interests.

A man must therefore be most inexcusable, who is either absent during such debates, or steeps, or whispers, or catches flies during the argument, and just rouses when the vote is called, to give his yea or nay, to the weal or woe of a nation.—Therefore it is manisestly proper, that every natural motive that can operate on his understanding, or his passions, to engage his attention and utmost efforts, should be put in practice, and that his present feelings should be raised by every motive of honor and shame, to stimulate him to every practicable degree of diligence and exertion, to be as far as possible useful in the great discussion.

I appeal to the feelings of every reader, if he would not (were he in either house) be much more strongly and naturally induced to exert his utmost abilities and attention to any question which was to pass thro’ the ordeal of a spirited discussion of another house, than he would do, if the absolute decision depended on his own house, without any further inquiry or challenge on the subject.

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As Congress will ever be composed of men delegated by the several States, it may well be supposed that they have the confidence of their several States, and understand well the policy and present condition of them; it may also be supposed that they come with strong local attachments, and habits of thinking limited to the interests of their particular States: it may therefore be supposed they will need much information, in order to their gaining that enlargement of ideas, and great comprehension of thought, which will be necessary to enable them to think properly on that large scale, which takes into view the interests of all the States.

The greatest care and wisdom is therefore requisite to give them the best and surest information, and of that kind that may be the most safely relied on, to prevent their being deluded or prejudiced by partial representations, made by interested men who have particular views.

This information may perhaps be best made by the great ministers of state, who ought to be men of the greatest abilities and integrity; their business is confined to their several departments, and their attention engaged strongly and constantly to all the several parts of the same; the whole arrangement, method, and order of which, are formed, superintended, and managed in their offices, and all informations relative to their departments centre there.

These ministers will of course have the best information, and most perfect knowledge, of the state of the Nation, as far as it relates to their several departments, and will of course be able to give the best information to Congress, in what manner any bill proposed will affect the public interest in their several departments, which will nearly comprehend the whole.

The Financier manages the whole subject of revenues and expenditures—the Secretary of State takes knowledge of the general policy and internal government—the minister of war presides in the whole business of war and defence—and the minister of foreign affairs regards the whole state of the nation, as it stands related to, or connected with, all foreign powers.

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I mention a Secretary of State, because all other nations have one, and I suppose we shall need one as much as they, and the multiplicity of affairs which naturally fall into his office will grow so fast, that I imagine we shall soon be under necessity of appointing one.

To these I would add Judges of law, and chancery; but I fear they will not be very soon appointed—the one supposes the existence of law, and the other of equity—and when we shall be altogether convinced of the absolute necessity of the real and effectual existence of both these, we shall probably appoint proper heads to preside in those departments.—I would therefore propose,

3. That when any bill shall pass the second reading in the house in which it originates, and before it shall be finally enacted, copies of it shall be sent to each of the said ministers of state, in being at the time, who shall give said house in writing, the fullest information in their power, and their most explicit sentiments of the operation of the said bill on the public interest, as far as relates to their respective departments, which shall be received and read in said house, and entered on their minutes, before they finally pass the bill; and when they send the bill for concurrence to the other house, they shall send therewith the said informations of the said ministers of state, which shall likewise he read in that house before their concurrence is finally passed.

I do not mean to give these great ministers of state a negative on Congress, but I mean to oblige Congress to receive their advices before they pass their bills, and that every act shall be void that is not passed with these forms; and I further propose, that either house of Congress may, if they please, admit the said ministers to be present and assist in the debates of the house, but without any right of vote in the decision.

It appears to me, that if every act shall pass so many different corps of discussion before it is completed, where each of them stake their characters on the advice or vote they give, there will be all the light thrown on the case, which the nature and circumstances of it can admit, and Edition: current; Page: [[215]] any corrupt man will find it extremely difficult to foist in any erroneous clause whatever; and every ignorant or lazy man will find the strongest inducements to make himself master of the subject, that he may appear with some tolerable degree of character in it; and the whole will find themselves in a manner compelled, diligently and sincerely to seek for the real state of the facts, and the natural fitness and truth arising from them, i. e. the whole natural principles on which the subject depends, and which alone can endure every test, to the end that they may have not only the inward satisfaction of acting properly and usefully for the States, but also the credit and character which is or ought ever to be annexed to such a conduct.

This will give the great laws of Congress the highest probability, presumption, and means of right, fitness, and truth, that any laws whatever can have at their first enaction, and will of course afford the highest reason for the confidence and acquiescence of the States, and all their subjects, in them; and being grounded in truth and natural fitness, their operation will be easy, salutary, and satisfactory.

If experience shall discover errors in any law (for practice will certainly discover such errors, if there be any) the legislature will always be able to correct them, by such repeals, amendments, or new laws as shall be found necessary; but as it is much easier to prevent mischiefs than to remedy them, all possible caution, prudence, and attention should be used, to make the laws right at first.

4. There is another body of men among us, whose business of life, and whose full and extensive intelligence, foreign and domestic, naturally make them more perfectly acquainted with the sources of our wealth, and whose particular interests are more intimately and necessarily connected with the general prosperity of the country, than any other order of men in the States.—I mean the Merchants; and I could wish that Congress might have the benefit of that extensive and important information, which this body of men are very capable of laying before them.

Trade is of such essential importance to our interests, and so intimately connected with all our staples, great and Edition: current; Page: [[216]] small, that no sources of our wealth can flourish, and operate to the general benefit of the community, without it. Our husbandry, that grand staple of our country, can never exceed our home consumption without this—it is plain at first sight, that the farmer will not toil and sweat thro’ the year to raise great plenty of the produce of the soil, if there is no market for his produce, when he has it ready for sale, i. e. if there are no merchants to buy it.

In like manner, the manufacturer will not lay out his business on any large scale, if there is no merchant to buy his fabrics when he has finished them; a vent is of the most essential importance to every manufacturing country—the merchants, therefore, become the natural negotiators of the wealth of the country, who take off the abundance, and supply the wants, of the inhabitants;—and as this negotiation is the business of their lives, and the source of their own wealth, they of course become better acquainted with both our abundance and wants, and are more interested in finding and improving the best vent for the one, and supply of the other, than any other men among us, and they have a natural interest in making both the purchase and supply as convenient to their customers as possible, that they may secure their custom, and thereby increase their own business.

It follows then, that the merchants are not only qualified to give the fullest and most important information to our supreme legislature, concerning the state of our trade—the abundance and wants,—the wealth and poverty, of our people, i. e. their most important interests, but are also the most likely to do it fairly and truly, and to forward with their influence, every measure which will operate to the convenience and benefit of our commerce, and oppose with their whole weight and superior knowledge of the subject, any wild schemes, which an ignorant or arbitrary legislature may attempt to introduce, to the hurt and embarrassment of our intercourse both with one another, and with foreigners.

The States of Venice and Holland have ever been governed by merchants, or at least their policy has ever been Edition: current; Page: [[217]] under the great influence of that sort of men. No States have been better served, as appears by their great success, the ease and happiness of their citizens, as well as the strength and riches of their Commonwealths: the one is the oldest, and the other the richest, State in the world of equal number of people—the one has maintained sundry wars with the Grand Turk—and the other has withstood the power of Spain and France; and the capitals of both have long been the principal marts of the several parts of Europe in which they are situated; and the banks of both are the best supported, and in the best credit, of any banks in Europe, tho’ their countries or territories are very small, and their inhabitants but a handful, when compared with the great States in their neighbourhood.

Merchants must, from the nature of their business, certainly understand the interests and resources of their country, the best of any men in it; and I know not of any one reason why they should be deemed less upright or patriotic, than any other rank of citizens whatever.

I therefore humbly propose, if the merchants in the several States are disposed to send delegates from their body, to meet and attend the sitting of Congress, that they shall be permitted to form a chamber of commerce, and their advice to Congress be demanded and admitted concerning all bills before Congress, as far as the same may affect the trade of the States.

I have no idea that the continent is made for Congress: I take them to be no more than the upper servants of the great political body, who are to find out things by study and inquiry as other people do; and therefore I think it necessary to place them under the best possible advantages for information, and to require them to improve all those advantages, to qualify themselves in the best manner possible, for the wise and useful discharge of the vast trust and mighty authority reposed in them; and as I conceive the advice of the merchants to be one of the greatest sources of mercantile information, which is any where placed within their reach, it ought by no means to be neglected, Edition: current; Page: [[218]] but so husbanded and improved, that the greatest possible advantages may be derived from it.

Besides this, I have another reason why the merchants ought to be consulted; I take it to be very plain that the husbandry and manufactures of the country must be ruined, if the present weight of taxes is continued on them much longer, and of course a very great part of our revenue must arise from imposts on merchandise, which will fall directly within the merchants’ sphere of business, and of course their concurrence and advice will be of the utmost consequence, not only to direct the properest mode of levying those duties, but also to get them carried into quiet and peaceable execution.

No men are more conversant with the citizens, or more intimately connected with their interests, than the merchants, and therefore their weight and influence will have a mighty effect on the minds of the people. I do not recollect an instance, in which the Court of London ever rejected the remonstrances and advices of the merchants, and did not suffer severely for their pride. We have some striking instances of this in the disregarded advices and remonstrances of very many English merchants against the American war, and their fears and apprehensions we see verified, almost like prophecies, by the event.

I know not why I should continue this argument any longer, or indeed why I have urged it so long, in as much as I cannot conceive that Congress or any body else will deem it below the dignity of the supreme power to consult so important an order of men, in matters of the first consequence, which fall immediately under their notice, and in which their experience, and of course their knowledge and advice are preferable to those of any other order of men.

Besides the benefits which Congress may receive from this institution, a chamber of commerce, composed of members from all trading towns in the States, if properly instituted and conducted, will produce very many, I might almost say, innumerable advantages of singular utility to all the States—it will give dignity, uniformity, and safety to Edition: current; Page: [[219]] our trade—establish the credit of the bank—secure the confidence of foreign merchants—prove in very many instances a fruitful source of improvement of our staples and mutual intercourse—correct many abuses—pacify discontents—unite us in our interests, and thereby cement the general union of the whole Commonwealth—will relieve Congress from the pain and trouble of deciding many intricate questions of trade which they do not understand, by referring them over to this chamber, where they will be discussed by an order of men, the most competent to the business of any that can be found, and most likely to give a decision that shall be just, useful, and satisfactory.

It may be objected to all this, that the less complex and the more simple every constitution is, the nearer it comes to perfection: this argument would be very good, and afford a very forcible conclusion, if the government of men was like that of the Almighty, always founded on wisdom, knowledge, and truth; but in the present imperfect state of human nature, where the best of men know but in part, and must recur to advice and information for the rest, it certainly becomes necessary to form a constitution on such principles, as will secure that information and advice in the best and surest manner possible.

It may be further objected that the forms herein proposed will embarrass the business of Congress, and make it at best slow and dilatory. As far as this form will prevent the hurrying a bill thro’ the house without due examination, the objection itself becomes an advantage—at most these checks on the supreme authority can have no further effect than to delay or destroy a good bill, but cannot pass a bad one; and I think it much better in the main, to lose a good bill than to suffer a bad one to pass into a law.—Besides it is not to be supposed that clear, plain cases will meet with embarrassment, and it is most safe that untried, doubtful, difficult matters should pass thro’ the gravest and fullest discussion, before the sanction of law is given to them.

But what is to be done if the two houses grow jealous and ill-natured, and after all their information and advice, grow out of humor and insincere, and no concurrence can be obtained?—I Edition: current; Page: [[220]] answer, fit still and do nothing till they get into better humor: I think this much better than to pass laws in such a temper and spirit, as the objection supposes.

It is however an ill compliment to so many grave personages, to suppose them capable of throwing aside their reason, and giving themselves up like children to the control of their passions; or, if this should happen for a moment, that it should continue any length of time, is hardly to be presumed of a body of men placed in such high stations of dignity and importance, with the eyes of all the world upon them—but if they should, after all, be capable of this, I think it madness to set them to making laws, during such fits—it is best, when they are in no condition to do good, to keep them from doing hurt,—and if they do not grow wiser in reasonable time, I know of nothing better, than to be ashamed of our old appointments, and make new ones.

But what if the country is invaded, or some other exigency happens, so pressing that the safety of the State requires an immediate resolution?—I answer, what would you do if such a case should happen, where there was but one house, unchecked, but equally divided, so that a legal vote could not be obtained. The matter is certainly equally difficult and embarrassed in both cases: but in the case proposed, I know of no better way than that which the Romans adopted on the like occasion, viz. that both houses meet in one chamber, and choose a dictator, who should have and exercise the whole power of both houses, till such time as they should be able to concur in displacing him, and that the whole power of the two houses should be suspended in the mean time.

5. I further propose, that no grant of money whatever shall be made, without an appropriation, and that rigid penalties (no matter how great, in my opinion the halter would be mild enough) shall be inflicted on any person, however august his station, who should give order, or vote for the payment, or actually pay one shilling of such money to any other purpose than that of its appropriation, and that no order whatever of any superior in office shall justify Edition: current; Page: [[221]] such payment, but every order shall express what funds it is drawn upon, and what appropriation it is to be charged to, or the order shall not be paid.

This kind of embezzlement is of so fatal a nature, that no measures or bounds are to be observed in curing it; when ministers will set forth the most specious and necessary occasions for money, and induce the people to pay it in full tale; and when they have gotten possession of it, to neglect the great objects for which it was given, and pay it, sometimes squander it away, for different purposes, oftentimes for useless, yea, hurtful ones, yea, often even to bribe and corrupt the very officers of government, to betray their trust, and contaminate the State, even in its public offices—to force people to buy their own destruction, and pay for it with their hard labor, the very sweat of their brow, is a crime of so high a nature, that I know not any gibbet too cruel for such offenders.

6. I would further propose, that the aforesaid great ministers of state shall compose a Council of State, to whose number Congress may add three others, viz. one from New-England, one from the middle States, and one from the southern States, one of which to be appointed President by Congress; to all of whom shall be committed the supreme executive authority of the States (all and singular of them ever accountable to Congress) who shall superinted all the executive departments, and appoint all executive officers, who shall ever be accountable to, and removable for just cause by, them or Congress, i. e. either of them.

7. I propose further, that the powers of Congress, and all the other departments acting under them, shall all be restricted to such matters only of general necessity and utility to all the States, as cannot come within the jurisdiction of any particular State, or to which the authority of any particular State is not competent: so that each particular State shall enjoy all sovereignty and supreme authority to all intents and purposes, excepting only those high authorities and powers by them delegated to Congress, for the purposes of the general union.

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There remains one very important article still to be discussed, viz. what methods the constitution shall point out, to enforce the acts and requisitions of Congress thro’ the several States; and how the States which refuse or delay obedience to such acts or requisitions, shall be treated: this, I know, is a particular of the greatest delicacy, as well as of the utmost importance; and therefore, I think, ought to be decidedly settled by the constitution, in our coolest hours, whilst no passions or prejudices exist, which may be excited by the great interests or strong circumstances of any particular case which may happen.

I know that supreme authorities are liable to err, as well as subordinate ones. I know that courts may be in the wrong, as well as the people; such is the imperfect state of human nature in all ranks and degrees of men; but we must take human nature as it is; it cannot be mended; and we are compelled both by wisdom and necessity, to adopt such methods as promise the greatest attainable good, tho’ perhaps not the greatest possible, and such as are liable to the sewest inconveniences, tho’ not altogether free of them.

This is a question of such magnitude, that I think it necessary to premise the great natural principles on which its decision ought to depend—In the present state of human nature, all human life is a life of chances; it is impossible to make any interest so certain, but there will be a chance against it; and we are in all cases obliged to adopt a chance against us, in order to bring ourselves within the benefit of a greater chance in our favor; and that calculation of chances which is grounded on the great natural principles of truth and fitness, is of all others the most likely to come out right.

1. No laws of any State whatever, which do not carry in them a force which extends to their effectual and final execution, can afford a certain or sufficient security to the subject: this is too plain to need any proof.

2. Laws or ordinances of any kind (especially of august bodies of high dignity and consequence) which fail of execution, are much worse than none; they weaken the government; Edition: current; Page: [[223]] expose it to contempt; destroy the confidence of all men, natives and foreigners, in it; and expose both aggregate bodies and individuals, who have placed confidence in it, to many ruinous disappointments, which they would have escaped, had no law or ordinance been made: therefore,

3. To appoint a Congress with powers to do all acts necessary for the support and uses of the union; and at the same time to leave all the States at liberty to obey them or not with impunity, is, in every view, the grossest absurdity, worse than a state of nature without any supreme authority at all, and at best a ridiculous effort of childish nonsense: and of course,

4. Every State in the Union is under the highest obligations to obey the supreme authority of the whole, and in the highest degree amenable to it, and subject to the highest censure for disobedience—Yet all this notwithstanding, I think the soul that sins should die, i. e. the censure of the great supreme power, ought to be so directed, if possible, as to light on those persons, who have betrayed their country, and exposed it to dissolution, by opposing and rejecting that supreme authority, which is the band of our union, and from whence proceeds the principal strength and energy of our government.

I therefore propose, that every person whatever, whether in public or private character, who shall, by public vote or other overt act, disobey the supreme authority, shall be amenable to Congress, shall be summoned and compelled to appear before Congress, and, on due conviction, suffer such fine, imprisonment, or other punishment, as the supreme authority shall judge requisite.

It may be objected here, that this will make a Member of Assembly accountable to Congress for his vote in Assembly; I answer, it does so in this only case, viz. when that vote is to disobey the supreme authority: no Member of Assembly can have right to give such a vote, and therefore ought to be punished for so doing—When the supreme authority is disobeyed, the government must lose its energy Edition: current; Page: [[224]] and effect, and of course the Empire must be shaken to its very foundation:

A government which is but half executed, or whose operations may all be stopped by a single vote, is the most dangerous of all institutions.—See the present Poland, and ancient Greece buried in ruins, in consequence of this fatal error in their policy. A government which has not energy and effect, can never afford protection or security to its subjects, i. e. must ever be ineffectual to its own ends.

I cannot therefore admit, that the great ends of our Union should lie at the mercy of a single State, or that the energy of our government should be checked by a single disobedience, or that such disobedience should ever be sheltered from censure and punishment; the consequence is too capital, too fatal to be admitted. Even tho’ I know very well that a supreme authority, with all its dignity and importance, is subject to passions like other lesser powers, that they may be and often are heated, violent, oppressive, and very tyrannical; yet I know also, that perfection is not to be hoped for in this life, and we must take all institutions with their natural defects, or reject them altogether: I will guard against these abuses of power as far as possible, but I cannot give up all government, or destroy its necessary energy, for fear of these abuses.

But to fence them out as far as possible, and to give the States as great a check on the supreme authority, as can consist with its necessary energy and effect,

I propose that any State may petition Congress to repeal any law or decision which they have made, and if more than half the States do this, the law or decision shall be repealed, let its nature or importance be however great, excepting only such acts as create funds for the public credit, which shall never be repealed till their end is effected, or other funds equally effectual are substituted in their places; but Congress shall not be obliged to repeal any of these acts, so petitioned against, till they have time to lay the reasons of such acts before such petitioning States, and to receive their answer; because such petitions may arise from sudden heats, popular prejudices, or the publication Edition: current; Page: [[225]] of matters false in fact, and may require time and means of cool reflection and the fullest information, before the final decision is made: but if after all, more than half the States persist in their demand of a repeal, it shall take place.

The reason is, the uneasiness of a majority of States affords a strong presumption that the act is wrong, for uneasiness arises much more frequently from wrong than right; but if the act was good and right, it would still be better to repeal and lose it, than to force the execution of it against the opinion of a major part of the States; and lastly, if every act of Congress is subject to this repeal, Congress itself will have stronger inducement not only to examine well the several acts under their consideration, but also to communicate the reasons of them to the States, than they would have, if their simple vote gave the final stamp of irrevocable authority to their acts.

Further I propose, that if the execution of any act or order of the supreme authority shall be opposed by force in any of the States (which God forbid!) it shall be lawful for Congress to send into such State a sufficient force to suppress it.

On the whole, I take it that the very existence and use of our union essentially depends on the full energy and final effect of the laws made to support it; and therefore I sacrifice all other considerations to this energy and effect, and if our union is not worth this purchase, we must give it up—the nature of the thing does not admit any other alternative.

I do contend that our union is worth this purchase—with it, every individual rests secure under its protection against foreign or domestic insult and oppression—without it, we can have no security against the oppression, insult, and invasion of foreign powers; for no single State is of importance enough to be an object of treaty with them, nor, if it was, could it bear the expense of such treaties, or support any character or respect in a dissevered state, but must lose all respectability among the nations abroad.

We have a very extensive trade, which cannot be carried on with security and advantage, without treaties of commerce and alliance with foreign nations.

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We have an extensive western territory which cannot otherwise be defended against the invasion of foreign nations, bordering on our frontiers, who will cover it with their own inhabitants, and we shall lose it for ever, and our extent of empire be thereby restrained; and what is worse, their numerous posterity will in future time drive ours into the sea, as the Goths and Vandals formerly conquered the Romans in like circumstances, unless we have the force of the Union to repel such invasions. We have, without the union, no security against the inroads and wars of one State upon another, by which our wealth and strength, as well as ease and comfort, will be devoured by enemies growing out of our own bowels.

I conclude then, that our union is not only of the most essential consequence to the well-being of the States in general, but to that of every individual citizen of them, and of course ought to be supported, and made as useful and safe as possible, by a constitution which admits that full energy and final effect of government which alone can secure its great ends and uses.

In a differtation of this sort, I would not wish to descend to minutiæ, yet there are some small matters which have important consequences, and therefore ought to be noticed. It is necessary that Congress should have all usual and necessary powers of self-preservation and order, e. g. to imprison for contempt, insult, or interruption, &c. and to expel their own members for due causes, among which I would rank that of non-attendance on the house, or partial attendance without such excuse as shall satisfy the house.

Where there is such a vast authority and trust devolved on Congress, and the grand and most important interests of the Empire rest on their decisions, it appears to me highly unreasonable that we should suffer their august consultations to be suspended, or their dignity, authority, and influence lessened by the idleness, neglect, and non-attendance of its members; for we know that the acts of a thin house do not usually carry with them the same degree of weight and respect as those of a full house.

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Besides I think, when a man is deputed a delegate in Congress, and has undertaken the business, the whole Empire becomes of course possessed of a right to his best and constant services, which if any member refuses or neglects, the Empire is injured and ought to resent the injury, at least so far as to expel and send him home, that so his place may be better supplied.

I have one argument in favor of my whole plan, viz. it is so formed that no men of dull intellects, or small knowledge, or of habits too idle for constant attendance, or close and steady attention, can do the business with any tolerable degree of respectability, nor can they find either honor, profit, or satisfaction in being there, and of course, I could wish that the choice of the electors might never fall on such a man, or if it should, that he might have sense enough (of pain at least, if not of shame) to decline his acceptance.

For after all that can be done, I do not think that a good administration depends wholly on a good constitution and good laws, for insufficient or bad men will always make bad work, and a bad administration, let the constitution and laws be ever so good; the management of able, faithful, and upright men alone can cause an administration to brighten, and the dignity and wisdom of an Empire to rise into respect; make truth the line and measure of public decision; give weight and authority to the government, and security and peace to the subject.

We now hope that we are on the close of a war of mighty effort and great distress, against the greatest power on earth, whetted into the most keen resentment and savage fierceness, which can be excited by wounded pride, and which usually rises higher between brother and brother offended, than between strangers in contest. Twelve of the Thirteen United States have felt the actual and cruel invasions of the enemy, and eleven of our capitals have been under their power, first or last, during the dreadful conflict; but a good Providence, our own virtue and firmness, and the help of our friends, have enabled us to rise superior Edition: current; Page: [[228]] to all the power of our adversaries, and made them seek to be at peace with us.

During the extreme pressures of the war, indeed, many errors in our administration have been committed, when we could not have experience and time for reflection, to make us wife; but these will easily be excused, forgiven, and forgotten, if we can now, while at leisure, find virtue, wisdom, and foresight enough to correct them, and form such establishments, as shall secure the great ends of our union, and give dignity, force, utility, and permanency to our Empire.

It is a pity we should lose the honor and blessings which have cost us so dear, for want of wisdom and firmness in measures, which are essential to our preservation. It is now at our option, either to fall back into our original atoms, or form such an union, as shall command the respect of the world, and give honor and security to all our people.

This vast subject lies with mighty weight on my mind, and I have bestowed on it my utmost attention, and here offer the public the best thoughts and sentiments I am master of.* I have confined myself in this dissertation intirely Edition: current; Page: [[229]] to the nature, reason, and truth of my subject, without once adverting to the reception it might meet with from men of different prejudices or interests. To find the truth, not to carry a point, has been my object.

I have not the vanity to imagine that my sentiments may be adopted; I shall have all the reward I wish or expect, if my dissertation shall throw any light on the great subject, shall excite an emulation of inquiry, and animate some abler genius to form a plan of greater perfection, less objectionable, and more useful.

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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.

Humbly offered to the Public.
[First published in Philadelphia, March 24, 1783.]

HAVING lately published ‘A Dissertation on that Political Union and Constitution, which is necessary for the Preservation and Happiness of the Thirteen United States of North-America,’ I now go on to consider some of the great departments of business, which must fail under the management of the great Council of the Union, and their officers.

The first thing which naturally offers itself to consideration, is the expense of government; this is a sine qua non of the whole, and all its parts. No kind of administration can be carried on without expense, and the scale or degree of plan and execution must ever be limited by it. Two grand considerations offer themselves here. 1. The estimate of the expenses which government requires: and, 2. Such Edition: current; Page: [[231]] ways and means of raising sufficient money to defray them, as will be most easy, and least hurtful and oppressive, to the subject.

The first is not my present principal object: I shall therefore only observe upon it, that the wants of government, like the wants of nature, are few and easily supplied; it is luxury which incurs the most expense, and drinks up the largest fountains of supply, and what is most to be lamented, the same luxury which drinks up the greatest supplies, does at the same time corrupt the body, enervate its strength, and waste those powers which are designed for use, ornament, or delight. The ways and means of supply are the object of my principal attention at present. I will premise a few propositions which appear to me to deserve great consideration here.

I. When a sum of money is wanted, one way of raising it may be much easier than another. This is equally true in States as in individuals. A man must always depend for supply on those articles which he can best spare, or which he can furnish with least inconvenience: he should first sell such articles as he has purposely provided for market; if these are not enough, then such articles of his estate as he can best spare, always sacrificing luxuries first, and necessaries last of all.

II. Any interest or thing whatever, on which the burden of tax is laid, is diminished either in quantity or neat value, e. g. if money is taxed, part of the sum goes to pay the tax; if lands, part of the produce or price goes to pay it; if goods, part of the price which the goods will sell for, goes to pay it, &c.

III. The consumption of any thing, on which the burden of tax is laid, will always be thereby lessened, because such tax will raise the price of the article taxed, and fewer people will be able or willing to pay such advance of price, than would purchase, if the price was not raised: and consequently,

IV. The burden of tax ought to lie heaviest on such articles, the use and consumption of which are least necessary to the community; and lightest on those articles, the use and consumption Edition: current; Page: [[232]] of which are most necessary to the community. I think this so plain, that it cannot need any thing said on it either by way of illustration or proof.

V. The staples of any country are both the source and measure of its wealth, and therefore ought to be encouraged and increased as far as possible. No country can enjoy or consume more than they can raise, make, or purchase. No country can purchase more than they can pay for; and no country can make payment beyond the amount of the surplus which remains of their staples, after their consumption is subtracted. If they go beyond this, they must run in debt, i. e. eat the calf in the cow’s belly, or consume this year the proceeds of the next, which is a direct step to ruin, and must (if continued) end in destruction.

VI. The great staples of the Thirteen United States, are our husbandry, fisheries, and manufactures. Trade comes in as the hand-maid of them all—the servant that tends upon them—the nurse that takes away their redundancies, and supplies their wants. These we may consider as the great sources of our wealth; and our trade, as the great conduit thro’ which it flows. All these we ought in sound policy to guard, encourage, and increase as far as possible, and to load them with burdens and embarrassments as little as possible.

VII. When any country finds that any articles are growing into use, and their consumption increasing so far as to become hurtful to the prosperity of the people, or to corrupt their morals or economy, it is the interest and good policy of such country to check and diminish the use and consumption of such articles, down to such degree as shall consist with the greatest happiness and purity of their people.

VIII. This is done the most effectually and unexceptionably, by taxing such articles, and thereby raising the price of them so high, as shall be necessary to reduce their consumption, as far as is needful for the general good. The force of this observation has been felt by all nations; and sumptuary laws have been tried in all shapes, to prevent or reduce such hurtful consumptions; but none ever did or can do it so effectually as raising the price of them: this touches Edition: current; Page: [[233]] feelings of every purchaser, and connects the use of such articles with the pain of the purchaser, who cannot afford them, so closely and constantly, as cannot fail to operate by way of diminution or disuse of such consumption; and as to such rich or prodigal people, as can or will go to the price of such articles, they are the very persons who, I think, are the most able and suitable to pay taxes to the State.

I think it would not be difficult to enumerate a great number of such articles of luxury, pride, or mere ornament, which are growing into such excessive use among us, as to become dangerous to the wealth, economy, morals, and health of our people, viz. distilled spirits of all sorts, especially whisky and country rum, all imported wines, silks of all sorts, cambrics, lawns, laces, &c. &c. superfine cloths and velvets, jewels of all kinds, &c. to which might be added a very large catalogue of articles, tho’ not so capitally dangerous as these, yet such as would admit a check in their consumption, without any damage to the States, such as sugar, tea, coffee, cocoa, fine linens, all cloths and stuffs generally used by the richer kind of people, &c. all which may be judiciously taxed at ten, twenty, fifty, or one hundred per cent. on their first importation; and to these might be added, a small duty of perhaps five per cent. on all other imported goods whatever.

Two things are here to be considered and proved. 1. That this mode of taxation would be more beneficial to the community than any other: and, 2. that this mode is practicable. If these two things are fairly and clearly proved, I think there can be no room left for doubt, whether this kind of taxation ought to be immediately adopted, and put in practice.

I will offer my reasons in favor of these propositions as fully, clearly, and truly as I can, and hope they may be judged worthy of a candid attention. I will endeavour in the first place, to point out the benefits arising from this mode of taxation.

I. This mode of taxation may safely be raised to such a degree, as to produce all the money we need for the public service, Edition: current; Page: [[234]] or sufficiently near it; perhaps a small tax in the ordinary way would be more beneficial to the States than none, because this tax keeps the customary avenues from the wealth of individuals to the public treasury always open, which may be used on emergencies, and the habit and practice being settled, would avoid the difficulties naturally arising from novelty or innovations.

But to return to my argument. It is greatly in favor of this kind of tax, that it will bring money enough for the public service; it is matter of great animation in the pursuit of any object, to know that, when accomplished, it will be adequate to its purposes. People all want to see the end of things, and to know when they are to have done: this will naturally produce much stronger efforts, vigor, and cheerfulness, than if the thing, when accomplished, would be but half adequate to its purposes.

II. This mode of taxation applies for money where it is to be had in greatest plenty, and can be paid with most ease and least pain. If we apply to the farmer, tradesman, or laborer for cash, they have mighty little of it, and it is hard for them to raise the necessary sum; but it is matter of common course with the merchant, thro’ whose hands the great current of circulating cash passes; he will consider the tax as part of the first cost of his goods, and set his price and sell accordingly: it matters little to him, whether he pays half the cost of his goods abroad, and the other half at home, or whether he pays it all abroad; his object is to get the whole out of his fales, with as much profit to himself as he can.

III. This mode lays the burden of tax on that kind of consumption which is excessive and hurtful, and lessens that consumption, and of course mends the economy, and increases the industry and health, of the people. For it is plain, that no more money will be paid for the goods taxed, than would have been paid for the same kind of goods, had they not been taxed: the difference is, the same money paid for the taxed goods will not buy so many of them as before the tax, because the tax will raise the price of them.

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And when the consumption or use of such goods is excessive and hurtful, this lessening of it is a benefit, tho’ the same money is paid for them as before, for the same reason that it is better for a man that happens to be at a tavern with excessive drinkers, to pay his whole share of the reckoning, but drink less than his share of the liquors, and go home sober, than to pay the same reckoning, drink his full share of the liquors, and go home drunk. It is always better for a man to buy poison and not use it, than to buy the same poison and use it; in the one case he loses nothing but his money, in the other case he loses his money and health too. For the same reason it is better for a reaper to drink half a pint of rum in a day, than to reap for the same wages, and drink a quart of rum. This reasoning will hold in its proper degree, with respect to every kind of consumption which is excessive and hurtful.

IV. This mode of taxation saves the whole sum of the tax to the States, while at the same time it mends the habits and health of the people: for it is plain, that if the consumption of such imported goods is lessened by the tax, a less quantity will be imported, and of course a less sum of money need be sent abroad to pay the first cost of these goods; and this excess of money, which is thus saved from going abroad (from whence it would never return) is paid by the tax into the public treasury, from whence it issues on the public service, and is directly thrown into circulation again thro’ the States, and of course becomes a clear saving, or balance of increase of the circulating medium, and consequently of realized wealth in the country; whilst at the same time, the people are better served and accommodated by the reduced consumption, than they could have been by the excessive one.

V. It appears from what has been just now observed, that this mode of taxation naturally increases the circulating cash of the States, and every one knows what a spring, what vigor this gives to every kind of business in the country, whether of husbandry, mechanic arts, or trade. There is no comparison between the advantages of carrying on any sort of business in a country where cash circulates freely, and Edition: current; Page: [[236]] in a country where cash is scarce. In the one case, every kind of business will flourish, and industry has every sort of encouragement and motive for exertion; in the other all business must be sadly embarrassed, and of course make but a feeble and slow progress.

We can scarce form a conception, what a different face these two circumstances will give a country in a short time; in the one case, buildings rise, husbandry improves, arts and manufactures flourish, the country is alive, and every part of it abounding with industry, profits, and delight; the other can produce little more than languishment, decay, dullness, and fruitless anxiety, disappointment, and wretchedness.

VI. The tax I propose, will operate in a way of general equality, justice, and due proportion. A tax on general consumptions cannot fail to bring the burden in due proportion on individuals, because every one will pay in proportion to his consumption; and the presumption is, that the man who spends most, is best able to spend.

If this proposition admits of exceptions, they are generally in favor of the economist, the careful, penurious man, and against the prodigal who dissipates his estate, and will operate as a check upon him, if he is not past all considerations of interest. If this is the case with him, the sooner his estate is run thro’ the better it is, both for himself and the public, for when this happens, he must either die or work for his living, and of course do some good in the world, or at least cease doing hurt; he will then no longer be able to set an example of idleness, extravagance, and dissoluteness, and draw other gay spirits into his pernicious practices; and if his constitution shall happen to out-last his estate, he may by temperance enjoy some good degree of health, and his adversities may perhaps bring on serious reflections, sincere repentance, and amendment of life, and if his fortune is desperate in this world, he may at least find strong inducements to prepare for the next; so that he is in no sense injured by the tax, but may by prudence derive great benefits from it.

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Besides, I am of opinion that government ought to leave every man master of his own estate, and permit him to judge for himself how fast and in what way he will spend it; he knows well what tax he pays on every expenditure, and every part of it is subject to his own free choice, and if his career of dissipation cannot be restrained, it is as well for him, and much better for the public, that he should give part of his wealth to the public treasury, than waste the whole of it in his luxury and pleasures; so that I do not see that he has in this case the least ground of complaint of injury or oppression.

Besides, I think there is a kind of justice in framing the public institutions in such a manner, that a man cannot spend a dollar in luxury and dissipation, which is hurtful to the public, but he must at the same time pay another dollar into the public treasury, to make thereby some compensation for the injury which the public receives from his luxury.

And as to the niggard, the penurious man, who does not spend his money in proportion to his wealth, and of course does not pay his share of tax; it is observable that even his very penury inures to the benefit of the community, for what he does not spend, he saves, and thereby enriches himself, and of course adds to the wealth of the community, for the wealth of the community is always the aggregate of the wealth of every individual who composes it; this ought therefore to be a favored case, as the community eventually gains more by a shilling saved, than it could by a shilling consumed and lost, tho’ the consumer should pay six-pence into the public treasury.

In fine, the tax on this principle is carved out of the expenditures of the nation, not indeed all expenditures indiscriminately, but is so calculated as to fall heaviest on those expenditures which are the most general indices of wealth, and are usually made by the rich who are the best able to bear them; and the few exceptions which may be supposed to take place, will generally operate in favor of virtue and economy, and against vice and dissipation; and where it falls heaviest, and becomes most burdensome, it is designed, and does actually tend, to correct that very vicious taste and corrupt Edition: current; Page: [[238]] habit, which is the true cause of the burden, and which it is always in the power of the sufferer to ease himself of, whenever he pleases.

Point out any other mode of taxing, if you can, that finds its way so surely to the wealth of individuals, and apportions itself thereto so equitably, that no subject can be burdened beyond his due proportion, without having a full remedy always in his own power; yea, a sure, easy, and excellent remedy, because a man may always avail himself of it, without the expense and trouble of a law-suit, or being subjected to any body’s decisions, opinions, or caprices, but his own.

VII. This mode of taxing will make the quantity and time of the tax depend on the free choice of the man who pays it. If a man has a mind to drink a bowl of punch or bottle of wine with his friend, or buy a silk gown for his daughter, he knows very well how much tax is incorporated with the purchase, and adopts and pays it with cheerfulness and good-humor; a humor very different from the irritated sensibility of a man, who sees an awful collector enter upon him with his warrant of plenary powers to distrain his goods, or arrest his person, for a tax which perhaps he abhors, either from religious scruples, or an opinion that he is rated beyond his due proportion, or because he is not at that time in condition to pay it.

The good-humor of the subject is of great consequence in any government. When people have their own way and choice in a matter, they will bear great burdens with little complaint; but when matters are forced on them contrary to their humor, they will make great complaints on small occasions, and the public peace is often destroyed, much more by the manner of doing, than by the thing done.

VIII. This mode of taxing will give our treasury some compensation for the monies which our people pay towards the tax of other countries which they travel thro’, or reside in, when abroad. An American cannot travel thro’ any country of Europe, and drink a bowl of punch or eat a dinner, but he contributes to the tax of the country; and if our taxes, like theirs, were laid on such luxurious consumptions as Edition: current; Page: [[239]] travellers usually indulge themselves in, their people who travel thro’ our country, or reside in it, would contribute towards our taxes, in like manner as our people who travel or reside in their countries, contribute to theirs.

And as we expect that the intercourse between us and all the countries of Europe will be very great, it is highly reasonable that our treasury should receive the same benefit from their travellers among us, that their treasuries receive from our people who travel or reside among them, and a little attention to the subject will be sufficient to convince any man that this article is more than a trifle.

IX. This mode of taxing, which brings the burden of the tax principally on articles of luxury, or at most on articles of not the first necessity, gives easement and relief to our husbandry and manufactures, which are in danger of ruin from the present weight of taxes which lies on them. If we tax land, we lessen its value, and of course diminish the whole farming interest. If we tax polls, we in effect tax labor, which discourages it, and of consequence we cast a damp and deadening languor on the very first springs, the original principle and source of our national wealth, and wound the great staples of the country in their embryo.

Now I think that any mode of taxing, which gives remedy and relief against so great, so fatal an evil, would deserve consideration, even tho’ it had not these advantages in its favor, which I have before enumerated. I have heard a stupid and cruel argument urged, that taxing labor has this advantage, that it promotes industry, because it increases necessity. This argument proves in a very cogent manner, that it is best to make every body poor, because it will make them work the harder.

But I should think it would be more humane and liberal in a government to manage the public administration so, that industry might have all possible encouragement, that it might be rather animated by an increase of happiness and hope of reward, than goaded on by dire necessity and the dreadful spurs of pinching want.

I freely give it as my clear and decided opinion, that it is the interest, duty, and best policy of every government, Edition: current; Page: [[240]] to give all possible ease, exoneration, and encouragement to that industry, those occupations, and kinds of business, which most enrich, strengthen, and happify a nation, and to lay the burdens of government as sar as possible on those fashions, habits, and practices, which tend to weaken, impoverish, and corrupt the people; and therefore that any mode of taxing which tends to encourage the first of these, and discourage the last, is worthy of the most serious attention.

But perhaps the advantage of this kind of taxation will appear in a more striking light, by considering its practical and general effects on a nation which adopts it; in which view of the matter I think it will be very manifest,

I. That any man of business, whether he be merchant, farmer, or tradesman, may live easier and better, i. e. be happier thro’ the year, and richer at the end of it, in a country where this tax is paid, than he could live in the same country, if the tax was not paid; for as the tax is laid on useless consumptions, it would of course diminish those consumptions, and of course save the first cost of the part diminished, and all the additional expense which the use of that part would require.

If a man lives in a country abounding in luxury, he must go in some degree into it, or appear singular and mean, and that part which he would be in a manner compelled to adopt, would probably cost him more than his tax.

But it is here to be considered, that the first cost of an article of luxury is not near all the cost of it. One article often makes another necessary, and that a third, and so on almost ad infinitum; if you buy a silk cloak, there must also be trimmings, and that will not do without a hat or bonnet, and these require a suitable accommodation in every other part of the dress, in order to keep up any sort of decency and uniformity of appearance; and there also must be spent a great deal of time to put these fine things on, and to wear them, to show them, to receive and pay visits in them, &c.

And when this kind of luxury prevails in a country beyond the degree which its wealth can bear, the consequence Edition: current; Page: [[241]] is pride, poverty, debt, duns, law-suits, &c. &c. The farmer finds the proceeds of the year vanished into trifles: the merchant and tradesman may sell their goods indeed, but cannot get payment for them. Every family finds its expense greatly increased, and the time of the family much consumed in attending to that very expense. Many families soon become embarrassed, and put to very mortifying shifts to keep up that appearance, which such a corrupt taste almost compels them to support.

But were these families with the same income, to live in a country of more economy and less luxury, they would easily pay the taxes on the luxuries they did use, keep on a good footing with their neighbours, appear with as much distinction, live happy and unembarrassed thro’ the year, and have money in their pockets at the end of it. In such a country, payments would be punctual, and industry steady, and of course all business both of merchandise, husbandry, and mechanic arts, might be carried on with ease and success.

These are no high colorings, but an appeal to plain facts, and to the sense of every prudent man on these facts; and I here with confidence ask every wise man, if he would not choose to live in a country where articles of hurtful luxury and needless consumption were, by taxes or any other cause, raised so high in their price, as to prevent the excessive use of them, rather than in a country where such articles were of easy acquirement, and the use of them so excessive among the inhabitants, as to consume their wealth, destroy their industry, and corrupt the morals and health of the people.

II. I think it is very plain, that articles of hurtful, or at best of needless, consumption are making such rapid progress among us, and growing into such excessive use, as to throw the economy, industry, simplicity, and even health of our people into danger; and of consequence, raising the price of such articles so high as will be necessary to produce a proper check to the excessive use of them, will require a tax so great, as, when added to a small and very moderate impost on articles of general and necessary consumption, will bring money enough into the public treasury, for all the purposes of the public service. We Edition: current; Page: [[242]] will suppose then that all this is done, and when this is done, we will stop a moment, and look round us, and view the advantages resulting from this measure, over and above the capital one of checking and restraining that excessive luxury that threatens, if not an absolute destruction, yet at least a tarnishment of every principle out of which our prosperity, wealth, and happiness must necessarily and for ever flow. I say, we will stop a minute and view the advantageous effects of this measure.

The first grand effect which presents itself to my view is, that our army will be paid; and that our brethren, our fellow-citizens, who, by their valor, their patience, their perseverance in the field, have secured to us our vast, extensive country, and all its blessings, will be enabled to return to their friends and connexions, not only crowned with the laurels of the field, but rewarded by the justice and gratitude of their country, and be thereby enabled to support their dignity of character, or at least be put on a footing with their fellow-citizens (whom they have saved) in the procurement of the means of living.

The next advantage of this measure which occurs to me is, the easement and exoneration of the laborers of the community, the husbandman and tradesman, out of whose labor all our wealth and supplies are derived; by them we are fed, by them we are clothed, by the various modifications of their labor our staples are produced, our commerce receives its principle, and our utmost abundance is supplied; we are therefore bound by every principle of justice, gratitude, and good policy, to give them encouragement and uninterrupted security in their peaceful occupations, and not, by an unnatural and ill-fated arrangement of our finances, compel them to leave their labors, which are the grand object of their attention and our supplies, to go and hunt up money to satisfy a collector of taxes.

But justice and gratitude operate only on minds which these virtues can reach. There may be some few among us, of no little weight, who are content, if they can obtain the services, to let the servant shift for himself, and who, when they are sure of the benefit, remember no longer Edition: current; Page: [[243]] the benefactor, and, as in this great argument of universal concern, I wish to find the way to every man’s sense, and address myself not only to those who have virtue, but even to those who have none, I will therefore mention another advantage of this measure, which I think will (virtue or no virtue) reach the feelings of every man who retains the least sense of interest, viz.

That in this way all our public creditors would be paid and satisfied, either by a total discharge of their principal, or an undoubted, well-funded security of it, with a sure and punctual payment of their interest, which would be the best of the two; because a total discharge of the principal at once, if sufficient money could be obtained, would make such a sudden, so vast an addition to our circulating cash, as would depreciate it, and reduce the value of the debt paid, much below its worth at the time of contract, and introduce a fluctuation of our markets, and other fatal evils of a depreciated currency, which have been known by experience and severely felt, enough to make them dreaded.

It would therefore be much better for the creditor to receive a certain, well-funded security of his debt than full payment: for in that case, if he needed the cash for his debt, he might sell his security at little or no discount, which is the constant practice of the public creditors in England, where every kind of public security has its rate of exchange settled every day, and may be negotiated in a very short time. Supposing this should be the case, stop and see what an amazing effect this would have on every kind of business in the country.

The public bankruptcies have been so amazingly great, that vast numbers of our people have been reduced by them to the condition of men who have sold their effects to broken merchants, who cannot pay them, their business is lessened, or perhaps reduced to nothing for want of their stock so detained from them. Supposing then that their stock was restored to them all, they would instantly all push into business, and the proceeds of their business would flow thro’ the country in every direction of industry, and every species of supply.

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In fine, the whole country would be alive, and as it is obvious to every one, that it is much better living in a country of brisk business than in one of stagnated business, every individual would reap benefits from this general animation of industry, beyond account more than enough to compensate the tax which he has paid to produce it.

All these advantages hitherto enumerated will put the labor and industry of our people of all occupations on such a footing of profit and security, as would soon give a new face to the country, and open such extensive prospects of plenty, peace, and establishment, throw into action so many sources of wealth, give such stability to public credit, and make the burdens of government so easy and almost imperceptible to the people, as would make our country not only a most advantageous place to live in, but even make it abound with the richest enjoyments and heart-felt delights.

These are objects of great magnitude and desirableness; they animate and dilate the heart of every American. What can do the heart more good than to see our country a scene of justice, plenty, and happiness? Are these rich blessings within our reach? Can we believe they are so absolutely within our power, that they require no more than very practicable efforts to bring us into the full possession of them? These blessings are doubtless attainable, if we will go to the price of them; and that you may judge whether they are worth the purchase, whether they are too dear or not, I will give you the price-current of them all, the price which, if honestly paid, will certainly purchase them.

In order to have them, then, we must pay about a dollar and a half a gallon for rum, brandy, and other distilled spirits; a dollar a gallon above the ordinary price for wines; a dollar for bohea tea, and about that sum above the ordinary price for hyson tea; a double price on silks of all sorts, laces of all sorts, thin linens and cottons of all sorts, such as muslins, lawns, and cambrics, and on jewellery of all sorts, &c. about a dollar and a third a yard above the ordinary price for superfine cloths of all forts, &c. &c. a third of a dollar a bushel for salt (for I do not mean to lay quite all the tax on the rich, and wholly excuse the poor) about a Edition: current; Page: [[245]] dollar a hundred for sugar, one tenth of a dollar a pound on coffee, and the same on cocoa, above the ordinary prices, &c. &c. with an addition of five per cent. on all articles of importation not enumerated, except cotton, dying woods, and other raw materials for our own manufactures; for whilst importations are discouraged, our own manufactures will naturally be increased, and ought to be encouraged, or at least to be disburdened.

On this state of the matter I beg leave to observe, that the war itself for seven years past has laid a tax on us nearly equal to the highest of these, and on some articles of necessary consumption, from two hundred to a thousand per cent. higher, such as salt, pepper, allspice, allum, powder, lead, &c. &c. and yet I never heard any body complain of being ruined by the war, because rum was twenty shillings per gallon, tea twelve shillings per pound, or mantuas three dollars a yard, or pepper ten shillings a pound, or superfine cloths eight dollars a yard, &c. Nor does it appear to me, that the country has paid a shilling more for rum, silks, superfine cloths, &c. for the last seven years, than was paid for the same articles the seven preceding years, i. e. the whole tax was paid by lessening the consumption of these articles.

Nor do I think that the health, habits, or happiness of the country have suffered in the least on the whole, from its being obliged to use less of these articles than was before usual; but be this as it may, it is very certain that the country has suffered but little from the increased price of these articles which I propose to tax, except at some particular times when those prices were raised much higher than the point to which I propose to raise them, i. e. at particular times rum has been as high as three dollars a gallon; tea, three dollars a pound; sugars, three shillings and six-pence, and coffee, three shillings and six-pence a pound; mantuas four dollars a yard, &c.

But it is observable, that the principal increased prices which have really hurt and distressed the country during the war, have been of other articles which I propose to tax very lightly, or not at all; such as salt, which has at times Edition: current; Page: [[246]] been six dollars a bushel, and perhaps three or four dollars on an average, coarse cloths and coarse linens, osnabrigs, cutlery, and crockery wares, &c. which have often rose to five or six prices, and stood for years together at three or four, and yet the burden of these excessive prices of even necessary articles of unavoidable consumption, has not been so great, if you except the article of salt, as to be so much as mentioned very often among the ruinous effects and distresses of the war.

The use I mean to make of these observations is, to prove from plain, acknowledged fact, that the increased price of the articles which I wish to tax, up to the utmost point to which I propose to raise them, will be but a light inconvenience (if any at all) on the people, and the diminished consumption of those articles, and the increase of circulating cash (both which will naturally and unavoidably result from the tax) will be benefits which will at least compensate for the burden of the tax, and I think it is very plain, will leave a balance of advantage in favor of the tax.

But if you should think I conclude too strongly, and you should not be able to go quite my lengths in this argument, so much, I think, does at least appear incontestably plain, that if there is a real disadvantage arising from my mode of taxing, it is so small, that it holds no comparison with the burden of tax hitherto in use on polls and estates, which discourages industry, oppresses the laborer, lessens the value of our lands, ruins our husbandry and manufactures, and with all these dreary evils, cannot possibly be collected to half the amount which the public service requires.

But to save further argument on this head, I will with great assurance appeal to the sense, the feelings of our farmers, who make the great bulk of our inhabitants, if they would not prefer living in a country where they must pay the afore-mentioned increased prices on the goods I propose to tax, rather than where they must part with the same number of cows, oxen, sheep, bushels of wheat, or pounds of pork or beef, &c. which are now, in the present mode of taxing, annually demanded of them to satisfy the tax.

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I dare make the same appeal to all our tradesmen, and even to our merchants, who, in my opinion, would have clear and decided advantages from my mode of taxing, as well as the farmers. I do not see how the merchant or any body else can be hurt by the tax; but will all be clearly benefited by it, if the following particulars are observed:

I. That the tax be laid with such judgment and prudence, and different weight on different articles, that the consumption of no article shall be diminished by it, beyond what the good and true interest of the nation requires; for it is certainly better for the merchant to deal with his customers in such articles as are useful to them, and in such way that they shall derive real benefit from their trade with him, than to supply them with articles that are useless or hurtful to them, and which of course impoverish them.

In the first case, he will make his customers rich and able to continue trading with him, and to make him good and punctual payments: in the other case, he makes his customers poor, and of course subjects himself to the danger of dilatory payments, or perhaps of a final loss of his debts.

II. That the tax be universal and alike on every part of the country, for if one State is taxed, and its neighbour is not, the State taxed will lose its trade. This proves in the most intuitive manner, that every tax of impost on imported goods must be laid by the general government, and not by any particular State, whose laws cannot be extended beyond its own jurisdiction. And,

III. That the tax be universally collected. Smuggling hurts the fair trader; favor and connivance of collectors to particular importers, thro’ bribery, friendship, or indolence, has the same effect; the person who avoids the tax can undersell him who pays it; therefore it is the great interest of the merchant, when the duty is laid, to make it a decided point, that every importer shall pay the duty.

And I am of opinion, that when the body of merchants make it a decided matter to carry any point of this nature, they are very able to accomplish it; they certainly know better Edition: current; Page: [[248]] than all the custom-house officers and tide-waiters on earth, how to prevent or detect smuggling, and to discover and punish the indulgence or connivance of collectors, who may be induced to favor particular importers, and they have the highest interest in doing this, of any set of people in the nation; and therefore I think it good policy to trust this matter to their prudence, with proper powers to execute it in the most effectual way.

From a pretty extensive acquaintance, I am convinced there is a professional honor in merchants which may be safely trusted; and I apprehend it is a policy both needless and cruel, to subject the persons and fortunes of merchants, the great negotiators of the nation’s wealth, and a body of men at least as respectable as any among us, to the insults of custom-house officers and tide-waiters, the rabble of whom, in Europe (I hope ours may be better) are generally allowed to be as corrupt, unprincipled, intolerable, and low-lived a set of villains as can be scraped out of the dregs of any nation; and to set such fellows to watch and guard the integrity and honesty of a most respectable order of men, and subject honorable and useful citizens to such mortifying inspection, appears to me to be such an insult on common sense,—such an outrage on every natural principle of humanity and decency,—such a gross corruption of every degree of polished manners, that I should imagine it must require ages to give it that degree of practice and establishment which has long taken place in Great-Britain.

The quickest way to to make men knaves, is to treat them as such. It is a common observation, when a woman’s character is gone, her chastity soon follows. Few men think themselves much obliged to exhibit instances of integrity to men, who will return them neither credit nor confidence for their uprightness. Let every man have the credit of his own virtues, and be presumed to be virtuous till the contrary appears. Honesty is as essential and delicate a part of a merchant’s character, as piety is of a clergyman’s, or chastity, of a woman’s, and you wound them all alike sensibly, when you show, by your conduct towards them, Edition: current; Page: [[249]] that you even suspect that they are wanting in these characteristic virtues.

I conceive nothing more is necessary to make the collection of this tax easy, than to convince the merchants, and indeed the whole community, that the tax is necessary for the public service,—for the essential purposes of government; and that every one who pays it, receives a full compensation in the benefits he derives from the union; and that the management of the affair be committed to the merchants, to which, from the nature of their profession and business, they are more adequate and qualified, than any other men; and as it falls directly within the sphere of their business, it seems to be an honor, a mark of confidence, to which they are entitled.

Indeed, let the community at large be convinced that the money proceeding from this tax, is necessary for the public service, and that it can be assessed with less burden on the people in this way, than in the mode hitherto practised, and the collection will be easy and natural.

The tax will cease to be considered, like the taxes formerly imposed on us by the British Parliament, unconstitutional in their assessment, and useless in their expenditure, for they plagued us with taxes only to satisfy their harpies (little or none of the money ever reached the British treasury) but this tax is imposed by our own people,—by our own representatives, and for our own benefit.

It must be imposed by Congress indeed, as the authority of any particular Assembly cannot be adequate to its for it must operate alike in all the States, be alike universal in its effects, and uniform in its mode of assessment and collection; and must therefore proceed from the general authority which presides over the whole Union, i. e. from the Congress; but it is a Congress of our own appointment: for the members of Congress are as much our representatives, and chosen by our people, as the members of the several State-Assemblies; and the end and use of the tax is our own public service, to secure the benefits of our union, without which it is impossible we should obtain respectability abroad, an uniform administration of civil police Edition: current; Page: [[250]] at home, an established public credit, or full protection against domestic or foreign insult.

I never knew any measure of government opposed in its execution by the people, when a general conviction took place that the measure was properly planned, and was necessary to the public good. We have had full proof thro’ the war, what great burdens our people will, very cheerfully and even without complaint, bear, when they are convinced that the exigencies of the State, and the public safety, made them necessary.

This exhibits the tax in an advantageous light, rather eligible than shocking, connects the ideas of burden and benefit together, and naturally brings the evils removed by the tax, and the advantages resulting from it, into one view, and may strike the minds of the people so strongly, as to make the burden of it appear light, when compared with its benefits.

This brings me to the consideration of the practicability of my mode of taxation which I proposed, and which I do conceive is a matter of capital weight in this discussion, for which I do rely on these two grand propositions:

1. That whatever is the real, great interest of the people, they may, by proper measures, be made to believe and adopt: and,

2. That whatever is admitted to be a matter of common and important interest, in the general opinion of the people, may be easily put in practice by wisdom, prudence, and due management of the affair.

I do contend, that when this tax is fairly proposed to the public, with a proper elucidation of the evils it avoids, and the advantages which result from it, it will not be looked on as a burden of oppression, an imposition of power, but as the purchase of our most precious blessings, as a measure absolutely necessary to our most essential and important interests.

Therefore any attempt to avoid this tax, by smuggling or any other way will be deemed by general consent an act of meanness; an avoidance of a due share of the public burden; frustrating the necessary plans of public safety, and rendering Edition: current; Page: [[251]] ineffectual the public measures adopted by general consent, for the public security, tranquillity, and happiness.

Such an action implies in it great meanness of character in the agent, and a high crime against the State, and the detection of it will be considered as a very material service to the Commonwealth. Where any actions are deemed crimes, scandals, and nuisances by the general voice of the people, detections and informations against them are reputable; they cease to be infamous—the infamy of an informer does not take place in such instances.

The reasons of governmental measures ought always to attend their publication, so far as to afford good means of conviction to the people at large, that their object and tendency is the public good. This greatly facilitates their execution and success. It is hard governing people against their interests, their persuasions, and even against their prejudices. It is better to court their understandings first with reason, candor, and sincerity, and we may be almost sure all their passions will follow soon.

I abhor a mysterious government. I think an administration, like a private man, which affects to have a great many secrets that must not be explained, has generally a great many faults which will not bear telling, or a great deal of corruption which will not bear examining. Government, like private persons, may indeed have secrets, which ought to be kept so; but in that case, caution should be used against any intimations or hints getting abroad, even that there are such secrets, or any secrets: for this would produce an anxious inquiry and solicitous inspection, which might make the keeping the secret more difficult, and besides bring on many other inconveniencies arising from numberless apprehensions, which such a circumstance would give birth to.

An ostentatious giving out that there are mighty secrets in the cabinet, or many mysteries in the State, that must not be pried too closely into, is the very contrary of all this, and generally is a sign of a weak administration, and not seldom of a corrupt one; but of all public measures which require explanations to the people, that of taxes, which touches Edition: current; Page: [[252]] their money (which is always a very sensible part) may stand as chief; and to make these go down any thing well, it is always necessary to spread an universal conviction,

1. That the money required in taxes is necessary for the public good: and,

2. That it will certainty be actually expended only on the objects for which it is asked and given.

And if these two things are really true, there will rarely be much difficulty in making them to be believed thro’ the most sensible part of the Commonwealth; but if these two things either are not really true or not really and generally believed, I do not know that a standing army would be sufficient to collect the taxes.

I am of opinion their force, authority, and influence, like the conquests of the British army, would last no longer in any place than they staid to support it. Whenever they shall go away, I imagine they will find that they have left behind them infinitely more abhorrence than obedience among the people.

Tho’ I am clearly of opinion that there must exist an ultimate force or power of compulsion in every effective and good government, yet it is plain to me, that such force is never to be put in action against the general conviction or opinion of the people; nor indeed do I believe it ever can be so exercised with success and final effect, for every attempt of this kind tends to convulsions and death.

Such an ultimate force indeed ought to fall upon and correct those who sin against the peace, interest, and security of the public. But this can be done with safety and advantage only in cases where the crime punished is against the opinions, the sentiments, and moral or political principles, which generally prevail in the people; for if the most violent declaimer and mover of sedition in a government, should happen to be received by the people as a patriot, and his harangues should be eagerly adopted as the doctrines of their liberties and rights, any attempt to punish him would be vain or useless.

For either the people would interpose and rescue him, or, if he was punished, they would consider him as the martyr Edition: current; Page: [[253]] of their cause, and thereby the public uneasiness, tumult, and uproar would be augmented: but when single persons or parties counteract the laws, and disturb that peace and order of government which is established by general consent, and in which there is a general persuasion that the security of every individual is concerned, there will be no difficulty in making such examples of punishment, as shall be sufficient to curb those turbulent and factious spirits, more or less of which may be found in every community, and which would become intolerable, if not kept under a rigorous restraint.

In all cases of this sort, the righteous severities of government will be approved, supported, and even applauded by the general voice.

Yea, if we were to suppose that the general opinion was wrong in any particular matter of importance, yet it is plain, that vicious opinion could not be controlled by force; it must continue till the ill effects of it shall produce a general conviction of its error, or till the people can be convinced by reason and argument of the danger of such opinion, before the ill consequences of it are actually felt; in both which cases the people will turn about fast enough of their own accord, and the error will be corrected most effectually, and with ease, and without any danger of disturbing the public tranquillity.

Opinions indeed of a dangerous, hurtful nature may spread among the people, and, when they become general, are to be considered as great public calamities, which admit of no remedy but that which they carry with them, and which will prove effectual in the end, viz. their own evil tendency, and therefore must be let alone, like inundations, which, however calamitous, whatever waste and destruction they make, cannot be controlled; any attempt to stop their force, increases their violence and mischief; they do least hurt when they are unmolested, and are suffered to drain themselves off in their own natural channels.

In short, there is no forcing every body, and therefore I reject with abhorrence every idea of governing a country by a standing army, or any other engines of force. I consider Edition: current; Page: [[254]] every plan of this kind as a departure from the true principles of government, as destructive in its consequences, as absurd and ineffectual to its own ends; for such a government, whenever it has been tried, instead of promoting the peace, security, and happiness of the State, has generally been found to have operated by way of tyranny and oppression.

It appears from all this, that the true art of government lies in good and full information of the facts to which its ordinances are to be accommodated, and in wisdom in adopting such institutions, laws, and plans of operation, as shall best suit the state and true interests of the people; and acting openly, fairly, and candidly with them. You may as well attempt, by finesses, to cheat people into holiness and heaven, as into their real political interests.

There are people scattered over the whole nation, who understand the great interests of the community and the wisdom of public measures, and are as firmly attached to them as those who sit in the seat of government, and who are always dissatisfied, and their confidence in the public counsels is lessened, when they observe public measures are adopted, which they do not see the use of, and the ends for which they are calculated; and of course little mystery and few secrets are necessary in government. Let the administration be such as will bear examining, and the more it is examined, the better it will appear.

In such a mode of administration as this, if burdens that are really heavy are necessary for the public safety, they will be cheerfully taken up, and patiently borne, by the people without endangering the public tranquillity.

Another objection against my mode of taxing (which, in my opinion, is the greatest by far that can be fairly urged) remains yet to be considered. I once almost concluded not to mention it here, because its hurtful operation is distant, we are in no present danger of its effects, and its evils may be prevented or remedied in future time by necessary measures, without requiring our present attention. But I will subjoin it, because I think it best to communicate every quality, effect, and tendency of this subject, which my Edition: current; Page: [[255]] utmost investigation of it has been able to discover, that the public may take it up or reject it on the fullest reason that I can lay before them. The objection is,

That this tax is insensible, and will produce more money than the people are apprized of, and in future time, when our trade and consumptions shall increase, may produce more than the public service will require, and of course will tend to public dissipation and corruption. For frugality in a court ever springs from necessity, and a rich treasury naturally makes a prodigal administration, and too often a corrupt one.

It may be answered, that it will always be easy to lessen or take the tax off, whenever it shall become too productive. This may be easy, but will always be dangerous. The imposing it at the close of the war will prevent the fall of the goods taxed, and keep them up partly to the war price, and of course save the merchants who have goods by them, from very great loss, and is a good reason for imposing it now; but when it shall be taken off, it will reduce the price of the goods taxed, in so sudden a manner, as will be very hurtful to those who have stock on hand, and may ruin very many families.

There is another, and perhaps better, way of guarding against the evils of the objection. It will be easy to transmit to each State an account of the annual proceeds of the tax, and when the amount shall exceed the annual expenditures, an account of the surplus, together with an estimate of the proportion of each State (according to the established quota of burdens and benefits) may be returned with it, and the said proportion of the surplus may be made subject to the orders of each State respectively; and if they judge that they can more safely trust their own economy, than that of the supreme administration, each State may draw its quota out of the general treasury into its own, and there keep it as a deposited fund of public wealth, or dispose of it as they please. Perhaps a fund to defray the internal expenses of each State might be as easily raised in this way as any other; but I leave a further discussion of the objection and its remedies to the wisdom of future times.

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But if this my mode of taxing, or any other that may be adopted, should not be sufficient for the public service, I could wish the deficiency might somehow be made up at home, without recurring to the ruinous mode of supplies by public loans abroad. I think that every light in which this subject can be viewed, will afford an argument against it. I have known this cogent argument used in favor of foreign loans, viz. we give but five per cent. interest abroad, and our people can make ten per cent. advantage of the money at home, therefore they gain five per cent. by the loan.

This stupid argument, if it proves any thing, just proves that it is every man’s interest to borrow money, for it is certainly profitable to buy any thing for five pounds which will bring ten; but the natural fact is the very reverse of this, for if you bring money into a kingdom or family, which is not the proceeds of industry, it will naturally lessen the industry and increase the expenses of it. It has been often observed, that when a person gains any sudden acquisition of wealth by treasure-trove, captures at sea, drawing a high prize in a lottery, or any other way not connected with industry, he is rarely known to keep it long, but soon dissipates it. The sensible value of money is lost, when the idea of it becomes disconnected with the labor and pain of earning it, and expenses will naturally increase where there is plenty of wealth to support them. The effect is the same on a nation.

Is Spain a whit richer for all the mines of South-America? The industry of Holland has proved a much surer source of durable wealth. We already find a dangerous excess of luxury growing out of our borrowed money, and our industry (especially in procuring supplies of our own) wants great animation.

Besides, the aforesaid argument is not grounded on fact; it is true, I suppose, that we pay but five per cent. interest on our foreign loans, but they cost us from fifteen to twenty per cent. more to get them home, for that is at least the discount which has been made on the fale of our bills for several years past, and if we bring it over in cash, Edition: current; Page: [[257]] there is freight and insurance to be paid, which increases the loss.

From this it appears, that for every eighty pounds of supply which we obtain in this way, we must pay at least an hundred pounds, even if we were to pay the principal at the end of the year, and the consuming worm of five per cent. interest every year after, if the payment is delayed: to all this loss is to be added, all the expense of negotiating the loans abroad, brokerage on sale of the bills, &c. &c.

To escape the ruinous effects of this mode of supply, I think every exertion should be made to obtain our supplies at home; it is certainly very plain our country is not exhausted, it is full of every kind of supply which we need, and nothing further can be necessary, than to find those avenues from the sources of wealth in the hands of individuals, which lead into the public treasury, those ways and proportions that are most just, most equal, and most easy to the people. This is the first great art of finance; that of economy in expenditures is the next.

Any body may receive money and pay it out; borrow money and draw bills; but to raise and manage the internal revenue, so as to make the wealth of the country balance the public expenditures, is not so easy a task, but yet I think not so hard as to be impracticable; unless this can be done, the greatest conceivable abilities must labor in vain, for it is naturally impossible that any estate, which cannot pay its expenditures, should continue long without embarrassment and diminution; the load of debt must continually increase, and the interest will make a continual addition to that debt, and render the estate more and more unable every year to clear itself; but if the estate can pay its expenditures, it is the height of madness not to do it.

If revenues can be spared sufficient to discharge the interest of the debt, so as to stop its increase, the estate may be saved, and a future increase of revenue may in time wipe off the principal; but no hope is left, if interest upon interest must continue to accumulate.

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And as the interest of every individual is inseparably connected with the public credit or state of the finances, it follows that this affair becomes a matter of the utmost concern and very important moment to every person in the community, and therefore ought to be attended to as a matter of the highest national concern; and no burden ought to be accounted too heavy, which is sufficient to remedy so great a mischief.

It may be objected to all this, that the duties I propose are so extremely high, that, 1. they will hurt our trade: and, 2. can have no chance of obtaining a general consent.

To the first I answer—as far as this tax tends to lessen the importation of hurtful luxuries and useless consumptions, it is the very object I have in view; and it is so very light on all other articles, that the burden will be almost insensible.

But as to the second objection—it is in vain to trifle with a matter of such weight and importance, or weary our people with small plans and remedies, utterly inadequate to the purpose. In weighty matters, weak, half-assured attempts will appear to every one to be labor lost, and a ridiculous disproportion of the means to the end: it is better in itself, as well as more likely to succeed with the people, to take strong hold, and, with a bold, firm assurance, propose something, which, when done, will be an adequate and effectual remedy.

Our national debt, including the supplies for the present year, I am told, by the Financier’s estimate delivered to Congress, amounts to about 35,000,000 of dollars, the annual interest of which will be somewhat above 2,000,000 of dollars, which, I think, may be raised by the tax I propose (tho’ it is impossible to tell with much precision, what the proceeds of a tax will be, which has not been tried:) it is very plain that the proceeds will be large, and so calculated as to be almost wholly a clear saving, not to say a benefit, to the country; and if there should be deficiencies, a small additional tax may be laid in the usual way to supply them.

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Our annual expenditures, on the peace establishment, may, I think, be reduced to a quarter or third of a million of dollars, and perhaps, if our national debt was liquidated as it ought to be, a great saving might be made both of principal and interest; but the detail of these matters is in every one’s power, who has leisure and proper documents to make the calculations.

Without descending to minutiæ, I only mean to examine the great principles of resource and mode of supply which are within our power, and give my reasons as clear as I can for adopting a practical trial. Such a practice would doubtless discover many things which no foresight can reach, and experience only can elucidate; it is an untrodden path which I recommend, and tho’ it cannot be perfectly known, yet it seems to me to have such an appearance of advantage as deserves a trial.

The expense and difficulty of collection will be no greater on the high tax I propose, than it would be on a trifling one, which would produce less than a tenth part of the supply which this would furnish.

Therefore, if it should be judged prudent to make the trial, I think it most advisable to take it up on such a large scale, as will make it sufficiently productive to become an object worthy of strong effort and persevering diligence, in order to give it a full effect.

In fine, we have not children or dunces to deal with, but a people who have as quick a sight of their interest, and as much courage, readiness, and cheerfulness to support it as any people on earth. We can have, therefore, nothing more to do, than to make such propositions to them as are really for their interest, to convince their minds that the thing proposed is necessary and beneficial; and this is to be done, not by refinement of argument, but by devising and explaining such measures as will, from their nature and operation, produce beneficial effects.

We must, with candor and fairness, in a manner open and undisguised, tell them what we want money for, and how much, and by a wise and upright management of their interests deserve and gain their confidence, that their money, Edition: current; Page: [[260]] when obtained, shall, to the last shilling, be paid for such necessary purposes; the tax will then cease to be odious. It will become an object of acknowledged interest, and every person who smuggles or otherwise avoids the tax, will be considered as shrinking from a burden which the public good makes necessary.

Every attempt of this sort will become disreputable and infamous, and when you can connect the tax and character together, there will be little difficulty in collecting it.

This will effectually obviate the great objection, viz. that it will be impracticable to collect a heavy tax on goods of great value, but little bulk, such as silks, laces, and the like, because they may be easily smuggled, &c. Whenever they are to be sold, they must be exposed to view, and let the burden of proof ever lie on the possessor, that the tax has been bona fide paid.

I should think it advisable to commit the management of this matter to the merchants; they are most hurt by smuggling, and of course have the highest interest in preventing it. It will be ten times more difficult to cheat and impose on them, than any others, because the matter falls wholly within their own sphere of business. Two of a trade cannot cheat one another as easy as either of them might cheat a stranger. If the merchants would take the matter up, and make it a kind of professional honor to prevent smuggling, and see that the duty is effectually paid, there is little doubt but they could effect it.

All this reasoning depends on this one principle, viz. that our public measures must carry in them wisdom, natural fitness, justice, and propriety; then they will gain character, reputation, and confidence among the people at large, and mutual interest will soon make the government easy and effective; every individual will soon find his interest connected with that of the public, and he will have every inducement both of honor and profit to stand well with the government, and effectually support it.

And in this way, even the great doctrine of taxation itself, that common and almost universal source of complaint, may become an object of acknowledged necessity, of confessed Edition: current; Page: [[261]] right, and the payment made like that of any other debt, with conviction of right and full satisfaction.

I will conclude this Essay with one argument more in favor of my principle of taxation, which appears to me of such mighty weight and vast importance, as must reach the feelings, and govern the heart, of every upright American, viz. that our public union, with all its blessings, depends on it, and is supported by it, and must, without it, dissolve and waste away into its original atoms.

To refuse any plan its necessary support, and to murder and destroy it, is the same thing; the union cannot be supported without so much money as is necessary to that support, and that money may be raised in the way I propose, and cannot in any other. We have a most plain and undeniable proof of fact, that, the usual mode of taxation of polls and estates, is in its principle unjust and unequal, because it does not operate on our people in any due proportion to their wealth: this mischief was less felt, when our taxes were very small, and therefore, tho’ unjust, were not ruinous; but the case is greatly altered, now the taxes are grown up into the burden which the present exigencies of the nation require.

The said tax hitherto in use is further ruinous, because it carves what money it does produce, out of the very first resources, the original principle of our national wealth, which, like tender cions, should be nursed and guarded with all care, till they arrive to strength and maturity;—then we may pluck the fruit without hurting the tree:—to cramp and diminish any of these, is like making bread of our seed wheat, or feeding our mowing grounds, every quantity we take lessens the next crop ten; but what gives decision to the point is, that we have the clear proof of experience, that the utmost efforts in this way have not been sufficient to produce one quarter of the sum necessary for the public service; nor is there any probability of an increased production.

The mode of supply by foreign loans need not be further reprobated; it is plain to every body, that if they can be continued (which is doubtful) they will soon involve us in a foreign debt, vastly beyond all possibility of payment: our Edition: current; Page: [[262]] bankruptcy must ensue; and with our bankruptcy will go all our national character of wisdom, integrity, energy of government, and every kind of respectability. We shall become objects of obloquy, butts of insult, and by-words of disgrace abroad; an American in Europe will be ashamed to tell where he came from. Every stranger takes some share in the character, in the honors or disgrace, not only of the family, but nation to which he belongs.

The scheme of issuing any more Continental money, I take for granted, nobody will think of; and therefore I conclude, that all the ways and means which have hitherto been tried, have proved utterly insufficient for the purpose: and I further conceive, that it will be allowed, that the mode I propose, if put into practice, would be sufficient. I further contend, that no other mode within our reach is or can be equally easy to the people, and equally productive of sufficient money for the various purposes of our union; this is then the only practicable way our union can be supported, and of course the union depends on it, and, without it, must inevitably fall to pieces.

To say all this, may be thought very great presumption in an individual; be it so; still I am safe, for no man can contradict me, who is not able to find and explain some other way of supply, equally easy to the people, and equally productive of all the money which the support of the union requires: but in as much as the eagerness of inquiry for several years past has not been able to discover any such other mode, I conclude there is no such, and of course, the one I have proposed is the only one that can be adopted, to save our union from dissolution.

And under the impression of this full persuasion, may I be permitted to address our public administration, not only in Congress, but in all the States, in the strong language of Lord Chatham—Set me down as an idiot, if you do not adopt it, or rue your neglect; and it is not certain that our posterity in the next age, and all our neighbours in the present, will not set you down for idiots, if you do not adopt it soon, before the mischiefs it is designed to obviate, shall grow up to such degree of magnitude and strength, as to Edition: current; Page: [[263]] become incapable of remedy; for what can they think, when they shall see that you suffer our union, which is committed to your care, to fall to pieces under your hands, because you will not attempt to give it that support, which, to say the least of it, is in its nature practicable, and the due practice of which would produce the great remedy required.

But you will say perhaps, we admit your principle to be just and good, but we cannot raise our ideas up to your height of scale or degree of impost; your tax is too high; it grasps too much, and is thereby in danger of losing all; it will scare our people out of their wits. I do not think much of this; if the wits which the people now have, are not sufficient for their salvation, it matters little how soon they are scared out of them; but it is not certain that their wits are so volatile; there is at least a possibility, a chance, that they may have wit enough to adopt the remedy that will prevent those calamities, which (if not prevented) will soon drive them out of their security—their property—their national honor—their country and wits too; at least I think it needless for you to lose your wits, for fear the people will lose theirs.

But I would ask you seriously, do you think that a less scale of tax than that which I propose, would be sufficiently productive for the public service, or the support of the Union? I think you must probably say no, on the bare presumption (for the produce of an untried tax cannot be reduced to a certainty:) to what purpose then, I further ask, would it be to set on foot so expensive and troublesome an operation, which, when completed, would be utterly inadequate to its purposes? or what funds have you, out of which you expect to draw the deficiency?

If there is any wisdom or effort in our counsels and plans, they must reach thro’; they must connect the means with the end, and make the one adequate to the other. Would you not laugh at a sailor, who should moor a ship with an inch rope, and so lose the ship, for fear his owners should find fault with him for wetting a cable? Where means are inadequate to their end, they become ridiculous, especially Edition: current; Page: [[264]] when adopted in matters of consequence; people lose all confidence in their effects, and therefore lose all courage and inducement to use strong efforts to make them operate.

I am clearly of opinion, if our people have lost their confidence in our public counsels, and are backward in pushing them into practice, the reason is, not because they stupid and blind to their interests, or wanting in zeal to promote them, but because their courage is all worn out, and their patience exhausted, by a seven years’ course of visionary, ineffectual, ill-contrived, and half-digested plans, which promised little in theory, but constantly in practice, proved the baseless fabrics of a vision, and vanished at last, not only without use, but with consequences very detrimental to our national character of integrity and wisdom, as well as to the interests and morals of our people; not the least discouraging of all which was this constant effect which they all had, viz. that those States or individuals, which promoted them with most zeal, ardor, and effort, always lost most by them.

I am of opinion it is quite time to quit this childish miniature of counsels, and adopt something up to the full life, and propose some system to our people, that will, when executed, be effective and sufficient for its purpose. I imagine such a proposal would find our people full enough of sense to discuss it, candor to approve of it, and zeal to promote it.

But if you will continue to believe that my high scale of tax will stupify our people with terror on first sight of the dreadful, dreary object, I will seriously ask you if you are acquainted with one individual, who, you think, would be likely to hang himself, or run distracted, or give up the American Union or Independence, on being told, that he must, for the rest of his life, pay a dollar a gallon tax on distilled spirits and wine; a duty equal to the first cost on silks, cambrics, lawns, muslins, laces, jewellery, and so on thro’ all the grades of the tax I propose.

Or how does the dreadful spectre affect your own constitution? Does it make your own blood run cold and stiffen in your veins? As you are mostly men of fashion Edition: current; Page: [[265]] and fortune, I conceive you will be as deeply interested in the tax as the most of your constituents, and you may pretty well judge of their feelings by your own. I do not apprehend that your anxiety is excited at all for yourselves, but for your people; but cannot you suppose that your constituents have sense to discern the necessity and utility of a public measure, judgment and patriotism to approve it, and firmness to bear the burden of it, as well as you?

Some objects, when seen thro’ a mist, or at a distance, appear frightful and clothed with terrors, which all vanish on a nearer view, and more close inspection. Some disagreeable things, when they come home to our feelings, are found to have less pain than distant expectation painted out.

Let us suppose and realize to ourselves then, that my scale of tax was adopted and become habitual to the people; can you imagine that the country would be thereby rendered a whit the worse, or more inconvenient to live in, than if the tax was not paid? or if you cannot come quite up to this, do you conceive the inconvenience of the tax paid in this way, by any comparison so heavy and burdensome, as the present tax on polls and estates, or any other of equal product, that has ever been practised or proposed, would be to the people at large.

I do not know how far our people at large are impressed with a sense of the importance of our union; it is, in my opinion, an object of the utmost weight; I conceive that the very existence of our respectability abroad, the interest which we are to derive from our connexions with foreign nations, and our security against foreign and domestic insults and invasions, all depend on it, and even our independence itself cannot be supported without it; and as I know well that the attachment of our people to their independence is almost universal, I should suppose that our union, which is so closely and inseparably connected with it, would likewise be an equal object of their attachment and concern.

If this is the case, I cannot be persuaded that our people will revolt against any reasonable and necessary means of supporting both the one and the other, and as the tax I propose appears to me the only possible and practicable Edition: current; Page: [[266]] means, any how within our power, which can be adequate to this great purpose, I cannot say that I shudder to propose such a tax; but I think we may safely presume on the good sense of our people, their patience, and discernment of their interests, enough to expect their concurrence in the measure, and even cheerfulness and zeal in supporting it.

But if this cannot be obtained, I can add no more; I have no conception that the Americans either can or ought to be governed against their consent, or that the collection of taxes, of any kind, or in any mode, can be made with success, whilst an opinion becomes general among the people, that the taxes are unnecessary, unjust, or improperly applied.

I think it would not be very difficult to make out the detail of particulars necessary to form the plan or system, both of the tax and its collection, on the principles herein urged; but the whole is humbly submitted to the consideration of the public, who, I hope, are enough impressed with the importance of the subject, and the necessity of adopting some decisions relating to it, without delay, to induce every one to give it that attention that its nature and weight requires, and which our present critical circumstances make indispensable to our political salvation.*

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I do not set myself up to propose systems of political union and plans of revenue because I think myself the fittest Edition: current; Page: [[268]] and most capable man to do it; but because I am convinced that every system of this sort must be the work of one mind, carefully and deeply comprehending the whole subject, and fitting all the parts to each other, so that every part may form a coincidence with the rest. It is scarcely possible for twenty or thirty men of the best abilities collected in a room together, to do this; either of them might do it alone, but all of them together cannot.

The twenty together may examine the system or plan, when made and proposed, and note its faults, but even then they cannot mend them, without danger of destroying its uniformity; they must do as you do with your clothes which do not fit, send for the tailor who made them, point out the faults, and direct him to take them home, and make the alterations.

Any man of a clear head may comprehend his own thoughts, but cannot so well enter into those of another. You might as well set twenty watchmakers to make a watch, and assign to each his wheel; tho’ each wheel should be exquisitely finished, it would be next to a miracle if the teeth and diameters fitted each other, so as to move with proper uniformity together; if this great work is done, somebody must do it, somebody must begin. A moderate genius may hit on, and propose, a thought, which a richer mind may improve to the greatest advantage. If I can attain this honor I shall have my reward, and please myself with the hope, that I may be in some degree useful to the country I love, which gave me birth, and in which I expect to leave my posterity.

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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.]

PUBLIC securities are notes or promises of payment, made in writing, to the public creditors, who had demands on the public for monies lent, supplies furnished, services rendered, &c. &c. Of these there are a great variety, and distinguished by divers appellations, such as loan-office certificates, depreciation certificates, final settlements, &c. &c.

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As the public was in no condition to pay these securities when they became due, they suffered a great depreciation: the owners sold them for what they could get, and they have long been an article of traffic in the hands of the brokers and speculators; and the price-current, or estimated Edition: current; Page: [[271]] value of them, as they pass from hand to hand, is become as much fixed and as well known in the brokers’ offices, as that of any other goods or merchandises.

And this price-current, made in market by the general consent of buyers and sellers, determines the value of all articles of traffic, whether goods, bills of exchange, public securities, stocks of every kind, or even money itself: and this rule of estimation is so fixed and natural, that no external force or height of authority can alter it, as has been clearly proved by experiment (the strongest proof in nature) in the instances of tender-laws and regulation of prices, which have often been attempted in vain, tho’ pushed as far as law, authority, violence, and force could go.

Therefore it follows, that the public securities, when they become articles of exchange or traffic, are really worth what they will bring in market, and no more; i. e. let their nominal value be what it will, their real value is so much as, and no more than, they will bring in market: this is plain, natural law, which it is in vain for the greatest force or highest authority to oppose; it will prove too strong for the most mighty opposition; it is therefore most wise to submit to it, and obey its sovereign dictates, without reluctance.

The price-current of public securities has been different at different times, and the different kinds of them are estimated at different prices; very many have been purchased at 2s. 6d. in the pound, or 8 for 1; others at 6s. or 7s. in the pound, or about 3 for 1. A few instances may be produced of sales at higher and lower prices; but in general, I believe, the above prices may be estimated as the extremes: very great numbers of final settlements have been bought at 2s. 6d. in the pound, or 8 for 1.

It is very certain, and undoubtedly confessed on all sides, that our soldiers, when their services were over, and their accounts were fairly adjusted, were entitled to the liquidated balances in their favor, in genuine money; this was in justice due to them for their services, and if they were paid, no more than justice was done them; but if, instead of this, they were paid nominally twenty shillings in a certificate, note of public promise, or any other article of negotiation Edition: current; Page: [[272]] or traffic, which was worth, by general consent of buyer and seller, in the public exchange, no more than 2s. 6d. and would bring no more, it is plain they were paid but 2s. 6d. in the pound, and the remaining 17s. 6d. is still due to them.

We will suppose, that instead of a certificate of 20s. which would bring but 2s. 6d. they had been paid in brass, at 20s. per lb. which was worth in market, and would bring no more than, 2s. 6d. per lb. it is plain their condition would have been exactly the same, i. e. the soldier that received the pound of brass, which he could sell for 2s. 6d. and no more, would be just as well off, and as well paid, as the soldier who received the certificate of 20s. which he could sell for 2s. 6d. and no more; it is a very plain case that neither of them are paid more than 2s. 6d. in the pound, and that the remaining 17s. 6d. remains unpaid, and consequently due to them.

And if any justice or honor to the public faith is designed or attempted, it must be effected by paying to them what still remains due to them. But can the human mind conceive, that any sort of justice or honor to the public faith would be done, not by pitying the poor soldiers, and paying the balance due to them, but instead of this, by raising a large sum of money, by taxing the community, to buy in all the brass, and giving 20s. per lb. for it to the speculators who had bought it of the soldiers for 2s. 6d. per lb. (even whilst the current market price was but 2s. 6d.) and giving interest till the cash was paid? which would be giving those speculators eight times as much money as the capital they advanced, and 48 per cent. per ann. interest for it, till the cash was paid.

The brokers’ interest of 4 per cent. per month, is a fool to this; for this not only recovers 4 per cent. per month interest, but secures the payment of eight-fold the capital, when the interest ceases. Besides, the brokers run some risk of opprobrium and loss of their debt; but this plan gives honor and security to the whole transaction, by giving it the sacred sanction of the supreme power of the State.

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It makes no difference to the argument, whether the article of traffic paid to the soldiers, and purchased in again by the State, be brass or certificates; because both, by the supposition, are of equal price in the market, and make a payment of equal value to the soldiers.

The whole argument holds good and in equal sorce, with regard to all original holders of public securities, as to the soldiers, all of whom are supposed to have furnished to the public, cash, goods, or services, to the amount of the certificates they received.

The argument also has the same sorce, with respect to speculators, who have purchased public securities at a higher exchange than 8 for 1: with respect to these, the conclusion is the same in nature, but differs only in degree.

This plan of paying the vast sums of public monies to speculators, which were originally due to the soldiers and other original holders of the public securities, and the payment being withheld from them to whom it ought to have been made, still remains due: I sav, the plan of paying these monies to the speculators, who at present hold the securities, i. e. paying to these speculators eight times the capital they advanced for the purchase of them, with 48 per cent. per ann. interest, till actual payment is made to them, and taxing the State to raise these monies, and of course taxing the poor soldiers (who, in their penury and distress, sold their certificates at 2s. 6d.) in the pound, for the money necessary to pay them at 20s. in the pound, with interest, to the speculators who purchased them: I say, this plan is adopted by some folks with great seriousness and gravity; and their ideas are supported with very specious arguments, the detail of which I wave considering just now, that I may mention one proposition, which I think necessary to introduce here, viz.

No ingenuity of argument can ever support an absurd conclusion; the absurdity of the conclusion for ever destroys the argument, however specious and ingenious the premises may be found: this is called by logicians reductio ad absurdum, has been taught in the schools a thousand years, and has always been allowed to be good reasoning.

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All the arguments that can be adduced, can never convince any body that this plan is right; there is not a boy in a compting-house, or maid in a kitchen, who would not exclaim against the injustice of it, the moment they heard and understood it; the common sense which refides in every human breast, revolts against it; for this I appeal to the sentiments and feelings of every body who has any.

Do not you think, my fellow-citizens, that a speculator in public securities must be pretty well brazed, yea, brassed over, who can express his joy without blushing, in the face of the world, and tell us that he is enlivened with hopes of obtaining a public act, entitling him to eight times the capital of his speculations, with 48 per cent. per ann. interest, till he receives the principal in good, solid, hard cash; all which he knows to be the earnings of the poor, distressed soldier, who, with his family, languishes for want of the payment, which is withheld from him by means of the failure of the public faith?

This plan, however cruel, shocking, and execrable it may appear, is defended by some folks by this argument, viz. the public securities, like bonds, bills of exchange, promissory notes, &c. are assignable or transferable over, by which the assignee becomes possessed of all the right and interest, which the original holder had therein; that the whole property passes by the assignment, and the sum paid by the assignee to the original holder, whether little or much, is of no consideration in the case.

I suppose this holds true generally with respect to bonds, bills of exchange, promissory notes, &c. but I do not think it holds true universally: the rule has its exceptions, and I think the case in point is manifestly one of the strongest instances of them. The Continental money is a most notorious one; the public faith was plighted for the redemption of that money, as sacredly as sorce of words, height of authority, and appeals to Heaven could do it. Yet every man acknowledges, that if that money, tho’ all made payable to the bearer, was to be redeemed at a hard dollar for every Continental one, the most absurd injustice would be done.

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The old State money of this State affords another instance of the same kind. The loan-office certificates afford a third instance, the value of which is estimated by Congress, by a public scale of depreciation, grounded on the real value of the certificates, at the several dates at which they were issued. Nobody pretends to object to this measure, or the principle on which it was founded.

Another instance may be adduced from a clear, decided rule of the law of the land, viz. if an executor buys up the bonds of his testator at a discount, i. e. by paying less than the nominal value for them, when he comes to make up the accounts of his executorship, he shall not be allowed the nominal value of those bonds, but so much only as he actually paid for them.

To all this I will venture to add here a proposed case, with my opinion on it, viz. suppose a merchant stops payment, who has thousands of bonds, notes, &c. against him, and upon the best survey of his affairs, it becomes the general opinion that he will pay 2s. 6d. in the pound, and his bonds and notes are generally passed from hand to to hand, at that exchange. Every broker and banker has them, and passes them for years together at that rate; but, after a series of time, the debtor becomes able and willing to pay his whole debt, and is cited into a most sovereign court of chancery, where mere right and justice is the rule of the court; where it is confessed that the 2s. 6d. is either paid or now due to the assignee of the note for 20s. and the sole question before the court is, who shall have the other 17s. 6d. whether the original creditor, to whom the debt was due, for full consideration paid, or to the assignee who had never paid any thing for it?

We will suppose the court is under no bias, but honestly mean to make such a decree as will be most just, do the most honor to their court, and be best approved in Heaven. I make no difficulty in giving my opinion, that the court will award in favor of the original creditor, who has paid the full consideration of the debt, in preference to the assignee, who has never paid any thing for it.

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Find fault with and disprove this opinion, whoever of you can; I expose it with confidence, to the censure of you all. Where two persons are in equal possession of an estate, it shall be given to him that hath right. Original right is such a sacred thing, that it can and will go great lengths in favor of its proprietor, is ever reverenced by the law, and ever claims the principal attention of the court.

I take it, that the facts out of which the reasons grow, that govern assignments of bonds, bills of exchange, and negotiable notes, are so toto cœlo different from those in the case now under discussion, that it is impossible to argue from the one to the other without the most manifest absurdity.

One instance of this difference, of full notoriety, and striking enough, is this, viz. that in the case of transfer of bills of exchange, negotiable notes, &c. a valuable consideration is always presumed to be given; but in the case in point no such thing, but the very contrary, appears in full blaze of evidence; 2s. 6d. in the pound has not the least pretension of being a valuable consideration for eight times the principal advanced, and 48 per cent. interest for the same, till the whole shall be paid, together with 48 per cent. for several years’ interest due on the certificate, before the purchaser ever saw it, or even paid his 2s. 6d. for it.

This fact stands glaring in the face of the world, and strikes conviction of its own injustice and absurdity into every beholder; it gives concern to the most avaricious speculator, and brings a blush even into the anvil countenances of the sanguine promoters of the blessed scheme of making provision for the enormous payment.

They endeavour to palliate it, or shuffle it out of sight, by suggesting that the instances of this sort are but few and inconsiderable, and so blended with the right and justice due to the distressed widows, orphans, soldiers, and other worthy citizens, who are public creditors, that they cannot be separated, and are therefore not worthy to be noticed; but here again the fact is notoriously against them. I should think a man had need of a front as hard as an Edition: current; Page: [[277]] andiron, to affirm, in the face of the public, that these instances are but few and inconsiderable.

It is a matter of public notoriety and general belief, that almost the whole of the widows, orphans, soldiers, and other distressed public creditors, have sold their certificates, which are now in the hands of the speculators, who are known to be very numerous, and many of whom have a vast amount of them.

But let these instances be few or many, it is a vain pretence to say they are so blended with the other public creditors, that they cannot be separated. A method of justice and due discrimination is easily investigated; the public creditors are easily found; their names are all on the public books, with the balances which were due to them when their accounts were settled.

I propose then, that they shall be debited with the certificates they received, at the price, exchange, or value at which they passed or could be sold, when they received them, and have the residue of their balance paid to them honestly, with interest.

It will take no more money to pay them than to pay the speculators; and as to the certificates, except such as are in the hands of the original holders, let them be paid to whoever brings them in, at a scale of value founded on their original value when they were issued, or the mean exchange at which they have passed for two or three years back.

This will repay to the speculators all the cash they have advanced, which, I think, is all the justice or tenderness to which they are entitled from the public; for, to say the best of them, I esteem them a sort of men barely tolerable, but by no means worthy of encouragement.

Some people say they have merit, and support the public faith, by giving something for certificates, when others would not buy them at all; but I think we are not much beholden to them, for vilifying and decrying the public faith, till they have persuaded the poor soldiers to sell their certificates for 2s. 6d. in the pound, rather than trust the public any longer.

As my proposal leaves no ground of complaint on the part of the speculators, so I think it will do manifest justice Edition: current; Page: [[278]] to the widows, orphans, soldiers, and other distressed public creditors, who, in my opinion, most justly deserve all the groans of compassion which are so liberally bestowed on them by our honorable Assembly, and the committee of public creditors.

I should be sorry to see the zeal of these patriots for the public faith abate, and their concern for the distressed creditors cool away, if the speculators should happen to lose their point, and, of course, should lower their cry for justice and compassion, when they find they are not like to finger the money.—Hinc istæ lacrymæ.

What now remains for me is, to show that the case above proposed is (mutatis mutandis) in fact the case in point. The public is the merchant who stopped payment (no body will dispute this) the thousands of bonds and notes against him, are the public securities or certificates of all kinds; the general consent which determined that he would pay 2s. 6d. in the pound, is the exchange settled by general consent, at which the public securities, especially the final settlements, have been bought and sold for a long succession of time.

And the high court of chancery, with sovereign power, totally unbiassed by any considerations but those of mere right and justice, and who mean to make such decisions as shall do the highest honor to the State, deserve the highest esteem and approbation of their fellow-citizens and the world, and merit the best approbation of Heaven; I say, this high court of chancery is our General Assembly.

And the parties who appear before this august court of chancery, i. e. our General Assembly, are the soldiers, who served us with fatigue and blood thro’ a seven years’ war, and other virtuous citizens, who furnished the public, in the greatest public exigence and distress, with cash and other supplies, and who altogether saved the liberties of the country, and procured for our Assembly itself, the very privilege of sitting, uninterrupted, within the walls which they now occupy, and of debating whether they will pay them or not; I say, these soldiers and other creditors are the original creditors, and the assignees are the stock-jobbers Edition: current; Page: [[279]] and speculators in the public funds and securities, who have in their hands the certificates, which, during the reputed bankruptcy of the State, they purchased at 2s. 6d. in the pound, or 8 for 1, without any allowance for interest at all.

I say, these two parties are the original creditors and the assignees of the bonds who appear before this court, and the grand question now before the court is, whether they will pay these public monies to the soldiers and other virtuous citizens, who are the original creditors; or whether they will pay these same monies to a parcel of stock-jobbers and speculators in the public funds and securities, at the rate of 8 for 1 of the principal they have advanced, and 48 per cent. per ann. interest, till the principal is paid, together with 48 per cent. interest from the date of the certificate, to the time of the purchase of it by the speculator, which, in some cases, is several years, and raises the interest due on the certificates at the time of purchase, to a much greater sum than was paid for the whole certificate?

We will then, if you please, suppose our venerable high court of chancery, viz. our Assembly, to be sitting, with the public monies all on the table before them; and the two parties appear and make their claim to the money; it is confessed that the public have had a valuable consideration for it, and therefore justly owe it to somebody, and the only question before the court is, who shall have it?

The speculators bring in their certificates signed over to them, and claim to be admitted in the place of the original creditors, and paid as such, on the equity and common reason of assignments.

The widows, orphans, soldiers, and other original creditors, come in and say,—we claim this money, because we have earned it, and have paid the full, valuable consideration for it. We have not yet been paid. We received these certificates when they were not so good as money, and have sold them mostly at 2s. 6d. in the pound, which was all that they were worth, and would bring in market, when we received them, and which we are willing to allow should be debited to us. So far we have been paid, but no further Edition: current; Page: [[280]] the remainder of the debt due from the public to us at the time of settlement, is still due to us and unpaid, and we now claim it. The speculators have no such plea of a valuable consideration given; they have purchased at such vast discount, that they have no pretensions to a valuable consideration given; what they have paid we are content they should receive back with interest; the rest is our dear carnings, which the public have had the full benefit of, and which we now claim as our due, and demand payment.

This is stating the matter, I conceive, clearly and fairly, and I beg leave to give my opinion decidedly in favor of the original creditors. It does appear to me, that the quid pro quo, or valuable consideration, goes so into the nature, and makes such a part of, the very essence of commutative justice, that it is impossible that an equitable debt should be generated without it, by any contract whatever.

It is a matter of the most public notoriety, that the quid pro quo, or valuable consideration paid by the speculators, is no more than the exchange at which they purchased the certificates, which is such a mere trifle, that it affronts the common feelings of the human mind, to pretend that such a trifle (say, one sixth or eighth part) is a valuable consideration for the whole; it is a valuable consideration for no more than was paid, and of consequence can generate a debt of no more; the rest still stands connected with the original consideration paid, i. e. sticks to the original creditor, and there will adhere, till it is discharged by an adequate payment.

For no man is born with, or can acquire, a right to the carnings or fortune of another, without giving a valuable consideration for it, and that consideration must be of adequate value; for a penny can no more be a valuable consideration for a pound, than nothing at all can be for a penny; for it strikes the human understanding as plainly, and with as much force, that a pound is worth more than a penny, as that a penny is worth more than nothing at all.

Therefore I do conclude, and contend strongly for the conclusion, that the speculators are entitled to no more than they have paid a valuable consideration for, and the Edition: current; Page: [[281]] rest remains due to the original creditors, as their dear earnings for which they have not yet been paid.

I know very well that the speculators have many ingenious arguments, spun as fine as silk, to prove their right to the whole debt specified in their certificates; but the soldier has a much better one, strong as iron, yea, made of iron, I mean his earnings with sword and musket, thro’ a seven years’ war, which yet remain unsatisfied. Do you think that the finest silken arguments of the speculator can stand any the least chance with this iron one of the soldier?

There is something in original right, which strikes the human mind with irresistible force: this original right will for ever attach itself to original earnings; there it will stick, and cannot be torn away by any force, nor be decoyed by any fraud, till it is satisfied by adequate payment. A just debt will for ever remain a debt due, till it is paid.

It therefore follows, that if we pay the Ipeculators the immense sums which they demand, the public debt of the whole sum will still remain due to the original creditors, who have, by their cash, supplies, and earnings, advanced the full, valuable consideration, out of which the debt first grew, and who have never been paid.

Public justice and the honor of the public faith require, not only that we pay as much money as we owe, but that we pay it to the persons to whom it is due; for paying it to any body else can be no satisfaction of that justice and faith which we owe to our real creditors, but is an additional injury to them.

The human mind can no otherwise know right and wrong, than by the force and manner in which they strike the mind, and raise an approbation or disapprobation in it; and I appeal to the feelings of all my readers, whether my propositions do not strike their minds strongly, and force their approbation of my conclusion. I challenge the hardiest speculator to believe it right, if he can, or rather not to believe it wrong, to lay the burden of a tax on the community, and among the rest on the public creditors themselves, to raise money to pay the public debt, and when it Edition: current; Page: [[282]] is collected, to pay it away, not to the real creditors, who, by their earnings and advances, have paid the full consideration for the debts due to them, but to others who never earned any thing for us, nor paid any valuable consideration to us, and, of consequence, can have nothing due to them from us.

There is another very serious consequence, which I aprehend from our paying such an enormous sum to the speculators, as they demand, if we now had the whole money in the treasury, viz. it would be such a drain of our public money, as would put it wholly out of our power to pay our real creditors in any tolerable season, and would, in a great measure, reduce them to despair, of ever receiving their debts due, and of course would greatly lessen all considence in the public faith.

But if the money is not in the public treasury (which I take to be the fact) our issuing another deluge of public promises, by way of funding such an enormous sum, I fear would hurt the credit of the State still more; for public promises, like all other promises that are broken, become of less and less value, the oftener they are repeated, and the more they are multiplied; and tho’ I profess to believe fully, that these new and multiplied public bills would be good enough to pay the speculators with, yet I should be sorry that our real creditors (who have paid a full consideration for their debts due from the public) should partake of the inconveniencies of them.

I therefore humbly propose, that the first thing we do, should be to set about raising the money; for this will be more acceptable when it comes, whoever is to have it, than any promises we can make.

And in the next place I would propose, that the real creditors should be paid first, and the speculators last of all, if it is judged necessary that they should ever be paid. I have several very urgent reasons for this proposition, both moral and political.

1. The real creditors have lain out of their money longer than the speculators, and it seems to me very reasonable and just, that the oldest dubts should be first paid.

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2. The speculators who expect eight-fold their principal, and 48 per cent. interest, can better afford to lie awhile out of their money, than the real creditors, who have no pretensions to any more than barely their principal, and 6 per cent. interest.

3. The general esteem of the people, and public conviction of the justice of the demand, is much greater with respect to the real creditors, than to the speculators; and therefore, when the citizens of the State are told, when the money is to be collected, that it is designed for the payment of the real creditors, the tax will probably be paid more cheerfully, and with less uneasiness and disturbance, than may be expected if it was publicly known that it was to go to the speculators.

4. The real creditors are poor, and would be greatly relieved by the payment made to them, and be enabled to go into business for their own and the public advantage. But when the speculators are paid, they will all at once become so amazingly rich, that they will probably set up their carriages, and run into other courses of idleness and pleasures, luxury and dissipation, which are ever hurtful to the public; and I think it good policy to pay that money first which is like to do the most good, and to pay that which is like to do the most hurt, last of all, if it must be paid at all; for I shall ever think it sound wisdom, if evils and mischiefs cannot be wholly avoided, to keep them at as great a distance as possible.

On the whole, whether any or all my propositions can be admitted or not, it does at least appear that the real, original creditors, and speculators, are characters of such different predicament and merit, and their demands on the public, founded on such different original considerations, reasons, and real earnings, that the least consequence that can be drawn from the whole matter, is a most manifest necessity that there should be a discrimination between them; that they can, with no propriety, or appearance of justice, be considered on an equal footing with each other, or in any manner entitled to the same consideration and treatment from the public.

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But I must stop here a moment, to consider a capital argument advanced very seriously, “that if all the certificates are not indiscriminately paid up to the holders of them, the public credit will receive such a wound that we shall never be able to persuade any body in future to loan money, or furnish supplies or services on the public faith, let our necessities be ever so great.” I believe it will be readily admitted, that I have stated this argument in the same light in which it is urged by those who make use of it; but I think there is a delusion in this statement of the argument, which I will endeavour to correct in the following manner, viz.

If, by any mismanagement or neglect, if, by any deficiency or misapplication of the public monies, it shall so fall out, that the real, worthy, public creditors cannot be paid; if matters are worked about by any shifts, arts, combinations, contrivances, or deceits, so that the man who has loaned money, furnished supplies, or rendered services to the public in its necessities, cannot be paid; no pretty, plausible excuse, no fine-spun arguments, no force of words, which really mean nothing, no pathetic addresses upon perverted facts, can help us out; but the public credit must suffer; and if the very men who make these mistakes, or even some wiser men, were to rule the roast in any future time of public distress, there is the highest probability that they would find people backward to lend their money, furnish supplies, or render services, on the credit of the public.

On the other hand, if we consent to pay the speculators the bare principal, which they have paid, with the interest of it, but shall refuse to secure by the public sanction, the profits of 8 or 900 per cent. which they demand, the amount of which, in moderate computation, cannot be less than 2 or 3,000,000 of dollars, which they never earned or paid for, nor we ever received any benefit or valuable consideration for; I say, if we refuse to pay to the speculators these enormous profits, it will so discourage them, that it may make them backward in venturing again, and so we may be obliged to do without them in future times, let us want them ever so much.

Both these alternatives are doubtless very dreadful, and Edition: current; Page: [[285]] I think there can be no doubt, but we are under an unavoidable necessity of incurring one of them; but I am in no condition to give my opinion, which would be the most terrible of the two. So having clearly and fairly stated the facts, I leave the rest to the reader.

But it may be further objected,—if all this is to be admitted, will it not put it out of the power of the holder of any public security, to sell it? Experience will perhaps furnish the best answer to this question. The depreciation of Continental money never stopped the circulation of it. As long as it retained any value at all, it passed quick enough; and would purchase hard money or any thing else, as readily as ever, when the exchange was 200 for 1, and when every hope, or even idea, of its being redeemed at nominal value, had entirely vanished.

I am told, the price of stocks or public securities in England is now at 55 per cent. i. e. reduced by depreciation to near half their nominal value; and not a man in England has the most distant idea that they will ever be redeemed at their nominal value, yet they pass quick enough at their exchange, and any person who is disposed to sell out, has no difficulty in finding a purchaser.

It may be further objected, that if the speculators could have known before-hand, that they should come off so, they would not have been concerned in such speculations at all; but would have laid out their money in trade, husbandry, manufactures, or some other way. However lamentable this may be, I must leave it unanswered.

It may be further objected, that this doctrine will overset and throw into confusion the common rules and laws, which regulate assignments of bonds, bills of exchange, negotiable notes, &c. which have had the sanction of long usage and practice, and have ever been found by experience to be both just and necessary.

I answer, it will not, for this plain reason, which would demonstrably govern the case, if nothing else could be said upon it, viz. every law or rule of right, whether commercial, political, moral, or divine, holds right and just, only in its mean; the moment it is pushed out of its mean, into Edition: current; Page: [[286]] its extremes, it loses the reasons on which it is founded, and becomes wrong and unjust.

We have a law which forbids to make graven images; but this prohibits not statues in gardens or heads on ships. We have another forbidding to do any work on the Sabbath; but this does not make it unlawful to put out the fire of a house that is burning, or laboring hard to save a drowning man, or to pull an ox out of the mire. We have a law that says, “thou shalt not kill;” but this prohibits not the execution of a malefactor, or fighting a battle: We have another that says, “thou shalt not steal;” yet a man may lawfully steal to satisfy his hunger.

The only question, I conceive, which the subject admits in this place is, whether the demand of the speculator is an extreme case, which comes not within the reasons, and of course cannot be justified or supported by the rule, of common assignments? I contend for the affirmative of this question, and for reason say the demand is morally wrong, because it would take an immense sum of money from the community, which must be a large proportion of their earnings, and give the same to the speculators, without any adequate valuable consideration, either paid by the speculators, or received from them by the citizens, contrary to the most fundamental law of commutative justice, which requires that a quid pro quo, or a valuable consideration, shall always be given in lieu of the property transferred. This is the most essential part of the moral law, which regards property.

Further, this is not only morally wrong, but politically so too.

1. Because it takes an immense property from those who had earned it, and would, of course, probably make the best use of it, and places it in the hands of people who have not earned it, and who would, of course, probably make the worst use of it. And it is certainly high policy to keep the wealth of the State as far as possible in the hands of those people who will make the best use of it.

2. Because this would impoverish the great body of the people, who are ever the strength of every nation, in order to Edition: current; Page: [[287]] throw immense wealth into the hands of individuals, which would not only weaken the State, but destroy that equality of the citizens which is necessary to the continuance of our republican form of government.

3. Because this plan will retard the increase of our trade and our population, and lessen the value of our lands. We all know that burdens on trade lessen it; heavy taxes on the country will discourage people from coming to settle on our lands, and, of course, the increase of our population will be retarded, which will reduce the number of purchasers of lands, and, of course, lessen their value.

Our neighbours, especially New-York, have a vast extent of unsettled lands; they court settlers with this powerful motive, that they have means to pay their debts without any burdensome recourse to taxes on their lands, labor, or cattle.

The funding plan in question, I am told, will require about 300,000 dollars per ann. to defray the interest only; besides which, we have sundry immense demands against the State. The principal debt, the funding of which is now under consideration, is about 5,000,000 of dollars, near half of which I take to be designed for clear profit to the speculators; to be due to them, or from us, it cannot be said, for they never paid us any thing for it; it must then be excessive generosity to them.

It may do for people to be generous, when their incomes are affluent, and cash, plenty; but when they are oppressed with debt to such an amount as to bring their credit, and even their capital, into danger, in this critical circumstance, the strictest economy, yea, even close parsimony, become very important duties. But in such a crisis of distress and danger, to assume an immense, needless, additional debt, even if a due consideration was paid for it, would be extreme ill policy; but to do it without any consideration at all, would be the height of absurdity and madness.

At all times we ought to be just, before we are generous. But at such a crisis, a lavishment that will put it out of our power to be just, must be reprobated as downright wickedness. And as the criminality of all crimes is estimated Edition: current; Page: [[288]] by the damage they do, that conduct in a ruler, which destroys the credit of a State, and even puts it out of the power of it to be just, and of course destroys the rights of thousands of its most meritorious citizens, ought to be branded, as the most censurable of any crime which can affect human property, character, and honor.

4. This plan is impolitic, because it will convey the money collected from the people to a great distance from the places where it was collected, and of course the people who paid it, will have little or no benefit from its future circulation. If the same monies were to be paid (as they ought to be) to the real creditors, i. e. the soldiers and others, who furnished monies, supplies, &c. who are scattered over the whole State, and are to be found in every part of it; I say, if the monies collected from the people were to be paid to those, it would be diffused over the whole State, and every person who paid the tax to raise these monies, would have a chance of taking benefit of its circulation.

But the cafe will be widely different, when it shall be paid to the speculators; most of them live in the city, and the few who reside in the country, when they come to receive their immense fortunes, will immediately come to the city, with all their money; the country will be no proper place to parade in; they will find nobody there fit to rank with; and that is not all; but when they clatter along in their carriages, they may chance to hear somebody say, “there goes a speculator or stock-jobber, who revels in the spoils of his country.”

In short, this will not do at all; they must move into the city, where they can find people of their own class to associate with.

And this is not the worst of it; the speculators, I suppose, must nominally belong to this State, but doubt not but they are in company, and share profits with many who live out of it, and consequently convey their wealth out of the State.

And this is not the worst of it, but I conceive that many of them, tho’ they reside in this State, are not natives Edition: current; Page: [[289]] of it; the domus animæ, domus optima, i. e. home is home, tho’ never so homely, is a strong affection in most men; and on the inducements of it, foreigners, when they travel abroad and acquire fortunes, have an inclination to return to their native country, to spend and enjoy them; and I think our speculators of foreign birth will have a motive additional to this natural one, to set off to their native country, viz. the powerful one of getting out of hearing of the curses of the people among whom they live.

It is here to be noted in a manner which I think deserves great attention, that however dirty, ragged, poor, and despicable an injured people may appear, they always have one species of revenge left to them, which they rarely fail to make the most of, viz. the power and privilege of cursing their oppressors; they curse them in the streets, they propagate their curses by their fire-sides to their children, who are not commonly apt to have much defect of memory, and they mix their execrations with their prayers to Heaven.

It is said that the curse causeless will not come; but I believe few States or individuals have reason to make themselves very easy under those curses which are not causeless. There is most certainly a Providence which governs the world, which pays the utmost attention to right and wrong, without the least respect imaginable to the lace or rags of the suitors.

Many more arguments might be adduced, but I deem the above fully sufficient, to prove that the plan in question is in its nature immoral and dishonest; and, in a political view, extremely injurious to the State, and I might almost add, fatally ruinous; and therefore is demonstrated to be an extreme case, not at all within the reasons of, and of course not justifiable by, the common law or rule of assignments, which, by long use, has been found to be both morally and politically good and useful.

The Committee of Public Creditors, in their last petition to the Assembly, have introduced one proposition, which pleases me very much, viz. “Nothing that is morally weong can ever be politically right.” I could wish Edition: current; Page: [[290]] this was written in letters of gold in the frontispiece of all our chambers of public council; and, what is more, might be engraved on the hearts of all our public men, as a practical principle too sacred to yield to any views of interest, however gaudily dressed, or finely colored: and, by way of giving it my little mite of improvement and support, I beg leave to add, that nothing which is both morally and politically wrong, can ever be right in any sense whatsoever.

I have one argument against satisfying the demands of the speculators, which I have not marked under either moral or political arguments, because it appears to me strongly to partake of both, and therefore ought to be mentioned by itself. It is this, viz. it gives public sanction, support, and even a kind of dignity, to a sort of speculation, which, if not wicked in itself, is of a nature very ruinous to the public, as it affords enormous profits without any earnings, viz. eight-fold the principal, and 48 per cent. interest, which (were they to be freed from disgrace and danger, and to be made reputable and safe by the sanction and support of the Legislature) would be enough to induce bad men of all professions to withdraw their stock in business, from their usual occupations, and vest it in such speculations of high profit and honor.

In my opinion, nothing scarcely can be worse than public laws or institutions, which tend to draw people from the honest and painful method of earning fortunes, and to encourage them to pursue chimerical ways and means of obtaining wealth by sleight of hand, without any earnings at all.

But were these speculators to gamble on each other’s purses only, I should think less of it; but it becomes publicly ruinous, when the public are to pay the losings.

The fatal experience of Europe might, methinks, be a warning to us. Ever since the blessed scheme of funding was first invented there, every nation has had a race of stockjobbers and speculators in the public securities, who never fail to appear in plenty whenever a State gets into distress, and the public faith faulters a little: they appear, to be sure, with a mighty pretty grace, in aid of the public Edition: current; Page: [[291]] credit, not indeed to keep it sound and whole, but to evince that it is not quite dead; and for a practical proof of this, they will offer to give at least something for it.

In the last days of Lewis XIV. (that noted æra of distress in France) this sort of people had the modesty to accept public securities of 32,000,000, for the loan of 8,000,000, which is 4 for 1. But our speculators go far beyond this; they give 2s. 6d. in the pound, which is 8 for 1. But it is no wonder that our speculators should exceed those of the most ingenious nation in Europe, since the American genius sets up to outdo all the world in every thing.

A crisis of public distress is the proper time for this kind of vermin to swarm, like flies about a sore, or crows round a carcass, not with any design to heal the sore, or restore life, but to feed themselves. This I admit to be a principle natural enough; but however excusable it may be in itself for these, like all other noxious animals, to pursue the means of their own preservation, yet I cannot think they are entitled to the gratitude, or support, or rewards, of the public.

I beg the reader to note here very particularly, that I do not mean by any thing I write, to oppose any practicable and wise plan of funding or paying the real public debts; all I object to is, funding or paying the profits of the speculators.

But however our public counsels may settle this question, and whatever is to be done with our public monies, when we get them, I here beg my readers’ attention a little, to the ways and means of raising them.

1. In the first place, I do object as strongly as I am able, to laying any considerable tax on polls and estates. This is taxing the labor, cattle, and lands of our people, which are the embryo, the first principles, the very feed, the raw materials of our wealth; and of course ought to be most carefully and tenderly nursed, cultivated, and encouraged; but by no means to be burdened and discouraged.

We have imported luxuries enough, which are hurtful to the public; the necessary restraints of which require a tax sufficiently large for the public use. It would be better for Edition: current; Page: [[292]] our people to pay a tax of a dollar per gallon on rum and wines, 50 per cent. on silks, &c. &c. than to suffer their labor and lands to be taxed. But if this, with our usual taxes on trade, &c. is not sufficient, I would rather tax our exported goods than our labor and lands; because I think it manifestly better to tax our finished goods, than our raw materials.

Besides, our past experience has sufficiently taught us, that the collection of any considerable tax on polls and estates is impracticable; the vast arrears of most of our counties are a full proof of this; and to make our treasury depend on revenues of uncertain product, is a sure way to subject our finance to constant disappointment, and of course to keep our public credit in a perpetual state of depression, and scandalous, as well as ruinous, deficiency. But I will not dwell longer here on this subject, having treated it more largely in my Sixth Essay on Free Trade and Finance, to which I refer the reader, if he desires to hear any more about it. [See p. 230.]

2. I object most seriously to issuing paper money, in our present circumstances, for the following reasons;

1. We have already a full sufficiency of circulating cash. The labor of our people, and all the great staple commodities of our country, produced by it, will and do bring not only immediate cash, but a high price; and it is not possible that money should be too scarce in any country, where the labor and produce of it have quick sale, good price, and command immediate cash; whilst this is the case, every natural and necessary end and use of cash is fully answered and satisfied; and, of course, if any body in such case wants money, the want must arise, not from any scarcity of cash, but from a want of something that will purchase it, i. e. from poverty; which the introduction of an additional quantity of circulating cash will by no means remove, but must increase, because it will directly tend to lessen industry, and introduce luxury.

It is no objection to this, that European and West-India goods will not bring ready cash; it is well known that the market is greatly glutted with those articles; and when a Edition: current; Page: [[293]] market is overstocked with any articles, they will not bring quick sale and ready cash, let money be ever so plenty.

2. Our cash for a year past has been not only fully sufficient for the purposes of our trade, but has been in a very settled, steady state, with very little fluctuation or variation in its value. This appears from the settled prices which our staple commodities have born thro’ the last year. The same thing appears from the negotiations of the Bank; from which it is manifest, that the state and quantity of hard cash is nearly the same with us now as it was a year ago; this proves that the quantity of circulating cash is sufficient; for were it not so, it would undulate and vary; for cash, like water, will always flow from the higher to the lower surface, and will never become fixed and steady till the true equilibrium is obtained.

3. It is admitted by every body, that cash was plenty enough before the war; but it is plain we have now much more of it than we had then; because the price of labor and the produce of the country are much higher now than they were then. On an average, about 40 or 50 per cent. more can now be obtained for labor and country produce, than their current price was in 1774.

It is no objection to this, that it is more difficult to borrow money on interest now than it was then; it is a want of public and private faith, and distrust of all security, and not a scarcity of cash, which makes the difficulty. Besides this, another cause may be assigned, viz. our monied men who used to dispose of their money in that way, have, at least many of them, lost their money, loaned on either public or private securities, by the defect of those securities, and of course the lenders of money are in this way reduced to a fewer number, whilst at the same time, the same cause adds to the number of those who have occasion to borrow; each of which naturally increases the difficulty of borrowing.

Striking paper money will lessen none of these difficulties, but will increase them all; as it is evident that it will much lessen all confidence in any securities of long continuance, Edition: current; Page: [[294]] and, in every view, diminish the number of lenders of money.

4. Making large and sudden additions (of either paper or hard money) to our circulating cash, will not increase our wealth; its effect will be an increase of the price of all articles of traffic, i. e. it will destroy the steady value of our money, by lessening its worth in an inverse ratio of the increase of its quantity, and so, without any benefit, will introduce the ruinous mischiefs of a fluctuating currency, from which, good Lord, deliver us!

5. I do not apprehend that we have the least chance of supporting the credit of paper money, if it should be issued; and to expose our public credit to further disgrace and insult, and to waste the public wealth in further stupid, absurd, and iniquitous appreciations of depreciated paper, appears to me the height of political frenzy. The pressure of a vast public debt, the low state of the public credit, the universal diffidence in that sort of money which prevails among the people of all ranks, and the dreadful apprehensions of its consequences, which are expressed by the Bank, and by all our merchants (who are certainly the best judges of the matter) I say, all these put together appear to me to destroy every degree of probability of supporting the credit of any additional paper currency.

And I cannot suppose any body distracted enough to think it proper to issue it, if every idea of the probability of supporting its credit must be given up. But I am apt to conjecture, that if our speculators fail in their scheme of getting their immense profits funded, the demand for that money will be greatly lessened, and so, perhaps, the zeal for striking paper may cool away, and, of course, any further arguments against it, may not be necessary. But if nothing can hinder the attempt, I am of opinion it must die in the birth.—For,

6. I do not believe it possible to usher paper money into general currency, either with or without a tender-act. Making it a tender is indeed too shocking to be admitted by any sober man that I have heard of; and without it, it must, I think, Edition: current; Page: [[295]] have the same effect, and share the same fate, as the other paper which has recently gone before it.

But after all, if it should gain a general currency, and a credit but little inferior to hard money, the effect, I think, must plainly and evidently be, that it will soon drive all the hard money out of the country, or at least out of circulation, as it will certainly be either hoarded or purchased up for exportation; and then we shall have nothing before us, but to increase the quantity of our paper, and supply the deficiency of its value by additions to its quantity, and make the most of it, Continental like, as long as we can make it pass at all.

7. With respect to the plan of opening a Loan-Office, and striking a sum of paper money to put into it, to be loaned out on private security to such persons as may want to borrow, I have to observe,

1. That all the objections which lie against striking paper money at all, lie with equal weight against striking any for this particular purpose.

2. This will bring the borrowers into difficulty, instead of helping them; for if they give a good security for the money, and find, when they have got it, that it is not equal to good money, but must be passed at a discount or depreciated value, their purposes will not be answered, nor their necessities be relieved by it. And,

3. This inconvenience will fall heaviest on the most distressed part of the community, for no others will give good security for bad money. And,

4. If the money should, by any strange turn, prove equal to hard money, the sum proposed, viz. 50,000l. is by no means equal to this demand, and, of course, will be immediately snapped up by favorites, or such who happen to stand nearest, and of course it will by no means operate by way of public benefit, or general relief of the distress of our people, but will be engrossed by a few sharp-sighted folks, with, perhaps, not the best title to public favors, or most likely to make the best use of them. I think that any scheme of this sort had better be put off, till we are in a condition to Edition: current; Page: [[296]] make it operate in a way of effectual, impartial, and general utility.

Upon the whole matter, the great principle I go upon with respect to public securities, is this, viz. that all bills issued on the public credit, of every sort, under whatever denomination they may appear, whether of certificates, paper money, annuities, &c. &c. take their value, not from the sums specified in the face of them, but from the price or exchange at which they generally pass in market, and, of course, when they are redeemed by the public, it ought to be either at their original value, or at that price or exchange at which they generally pass at the time of redemption, excepting only such securities as are in the hands of the original holder, and have never been alienated. Such securities are evidences of full consideration paid, and, of course, of a full debt due to such holder: but securities in the hands of a purchaser cannot be such evidence.

When public securities gain a currency, or become objects of traffic, and depreciate in the hands of the possessor, he doubtless sustains loss, and is really injured; and when the depreciation is great, say 8 for 1, or 200 for 1 (both which we have seen) the mischief becomes very heavy, and in its nature lies in the loss which the possessor of the securities sustained, by their depreciation whilst they were in his hands:

Hence it appears clearly enough where the mischief lies, and, of course, it is easy to see what must be the nature of the remedy it requires, viz. such a remedy as will make up the losses which every one has sustained by the depreciation of the public securities whilst in their hands. This is manifestly impracticable, and perhaps the utmost power of human invention cannot hit on any plan which will do this; what then ought the public to do? I answer, the same which any private man must do, who knows that he has had a valuable consideration for money, and honestly owes it, but knows not to whom it is due, or cannot find his creditor.

From this view of the matter it appears very plain, that appreciating the securities, and redeeming them at full value, gives not the least remedy to the sufferers by the depreciation, Edition: current; Page: [[297]] but is an additional injury to them; because the securities, at the time of redemption, will not be in the same hands in which they depreciated, and, of course, the sufferers will find themselves taxed to make up the money, which they lost by the depreciation, that it may be paid to the present holders of the securities, who never lost any thing. But if any one wishes to see this subject further discussed, I refer him to my Fifth Essay on Free Trade and Finance, where this matter is fully considered, with respect to Continental money. [See p. 97.]

I will conclude here by observing, that not one argument can be adduced for redeeming the public securities at full value, which will not apply to the Continental and old State money, and prove that both ought to be redeemed at full nominal value.

I take it that the public accounts are nearly all adjusted, and the public creditors have received certificates or public securities for their respective balances. But as those securities are mostly Continental, it will lie with Congress, and not with any particular State, to prescribe the time, mode, and value of their redemption.

In the mean time, I think we may do much for the present relief of our own distressed citizens, who suffer greatly by the delays of Continental payment; and I esteem the attempts of our Assembly very laudable in their principle. What I complain of is an error in the application. It is certainly very good in them to strain every nerve to raise money for the relief of our widows, orphans, soldiers, and other worthy and distressed public creditors; but I think it a mistake to plan the matter so, that when the money is raised, it shall not be applied to the relief of those worthy, distressed citizens, but shall go, at least a very considerable part of it, to a parcel of speculators, who neither ever earned it, nor are in any distress for want of it; for they are generally rich, and can command plenty of cash.

With the good leave of the public, I will sum up the matter, and humbly offer some propositions, which appear to me worthy of consideration.

I. I propose to set about raising all the money we can, not by a tax on polls and estates, which will be very burdensome Edition: current; Page: [[298]] to our people, hurtful to the capital interest of the State, and of very uncertain product; but by continuing our present duties on trade, with such further additional duties on luxuries, as will be necessary to restrain the excessive use of them: and this, I conceive, will require duties so high, as will be sufficient for the exigencies of the State, and will be of certain product.

II. I propose to pay all the interest which is now due to the inhabitants of this State, on all such public securities as are in the hands of the original holders, and have not been alienated (to be ascertained by affidavit or any other sufficient proof) and also to stop payment of all interest on any certificates which are not in the hands of the original holders; for I do not know that among citizens of equal merit, we can with justice make fish of one, and flesh of another.

III. I propose that commissioners be appointed to purchase up such public securities as were originally given to the citizens of this State, but have been alienated by the original holders, and are now in currency as objects of traffic or exchange; to purchase such securities, I say, at the current exchange, or as low as they can be bought. It is certainly as right for the State to buy up these securities, which are become a common object of traffic, as it is for any individual. Two great advantages will result from this:

1. The present holders will have the value of them paid in money: and,

2. The State will have them to produce to Congress, whenever our quota shall be demanded for the redemption of them; for the securities themselves will doubtless be accepted as good payment of our quota, both of principal and interest; and it will then be indifferent to us at what exchange, or in what manner or time, Congress may direct their redemption.

IV. I propose that all those original holders of public securities, who have alienated them, shall be debited on the public books, with the certificates they received, at the value (and no more) at which they could be sold at the time they received them, or the time of their date, and that the residue of their balance may be paid, together with the principal of the certificates, Edition: current; Page: [[299]] which are now in the hands of the original holders, and have not been alienated. I say, that both these be paid as soon as money sufficient can be raised by the State.

It will require, I know, a heavy sum of money to do this, but we shall have this satisfaction to animate our exertions, that we are doing an act of justice in favor of those to whom the money is justly due, and shall have the advantage of paying it to people who are scattered thro’ the State, and will immediately circulate the money among our citizens, in every part of the State, which, if the justice was equal, will be much preferable to paying the same money to people who would carry it all away to distant parts, from whence it would have little chance of returning into circulation, to the places where it was collected.

V. As the pressures of the State are very heavy, I think we ought to make all the savings we can; I therefore propose to lessen the House of Assembly, by taking away two-thirds of the members, and limiting the sessions of the Council to the Assembly’s sessions, unless the President should, on emergent occasions, summon them. I think one-third of our Assembly would do the business much better than all of them; and the President, with a good Secretary, would be sufficient for the common and usual business of the Council. I know of no advantage arising from over-numerous Legislatures, or Councils that sit too long. The extremes of democratical government tend to anarchy, or despotism, or ruin.

An idle, useless, or corrupt member is less noticed and easier lost in the crowd, in a large Assembly, than in a small one. Virtue and merit are, for the same reason, less conspicuous in a large than small Assembly; cabals, party-schemes, and interested plans, are easier formed in a large than in a small house, and the guilt or folly of an individual is more easily sheltered or concealed in great than in small numbers.

For when Assemblies are large, the business is most commonly done by a few, under the umbrage of the whole; the major part are not commonly in the secret. The American Congress rarely consists of more than thirty members Edition: current; Page: [[300]] present, yet no complaint has been made that their number is too small. The British House of Commons consists of more than five hundred members, not very famous for gravity, wisdom, or order. Their proceedings are commonly directed by the Premier, and a few leading members; yet if you ask Lord North, why he pushed the American war, he will tell you with great composure, that it was not his war, but the war of the Parliament.

When more people are employed about any business than are necessary to do it, the consequence has ever been found to be, that the business is not done so well, is clogged with more delays, is less consistent in its several parts, and not so well methodized. The people who are interested in the business, and have occasion to attend upon it, are not so well-served, and a greater expense is incurred, than would happen, if people just enough for the business, and no more, had been employed.

This, one would think, was grounded on natural fitness; for we find it holds true in all human affairs, from a house too full of servants, a field with too many reapers, a town-meeting of too many people, a kitchen with too many cooks, a committee of too many members, a church with too many deacons or too large a vestry, a court with too many judges, and so on, up to an assembly of the first dignity, with too many representatives.

Now to admit any principle or circumstance into our gravest and most important councils, which has ever been found hurtful in all cases where it has been adopted, is highly imprudent and dangerous, and tends to ruin. The fatal experience of many great nations proves this in a manner very forcible and convincing.

Rome and Greece lost their liberties by over-numerous Senates, &c. and Poland is now in desolation from the same cause; their Pospolite, which was instituted for the great defence of their nation, and their liberum veto, which they hugged with enthusiasm, as the standard of their liberty, together with their over-numerous Diets, have completely ruined them. But whether these observations are proper Edition: current; Page: [[301]] or not, we shall, by this proposition, at least save a vast expense, at a time when the utmost economy is necessary.

VI. At all times, but especially in times of public pressure, the peace and quiet of the State should be consulted, and the general confidence of the people in the government should be as far as possible secured, in order to its firm establishment, and the great principles of our civil policy should be strictly regarded. I therefore humbly propose the repeal of the test-act; for we can no how expect the internal peace and quiet of our people, and their confidence in our government, so long as we exclude one-third our citizens from any share in it.

Nor can we any how call our civil policy a government of the people, or reap the advantage of such a government, as long as so large a proportion of our citizens (if reckoned by numbers, influence, wisdom, or estate) are shut out and disfranchised. We need the counsels as well as the wealth of all our people, and our constitution gives equal right, as well as prescribes equal duty, to them all.

That the major must rule the minor, is undoubtedly a maxim essential to a democratical or republican government; but it is equally manifest, that the extremes of this maxim will destroy the very nature, as well as uses, of such governments. For if two-thirds can disfranchise the minor third, a majority of the remaining two-thirds may disfranchise the minority of them, and so on toties quoties, till there will be but two left undisfranchised, to govern the whole; which, I suppose, every body will allow to be somewhat worse than to have but one sovereign despot; for the two might quarrel, and each form his party, and so the State might be involved in a civil war, which could not happen, if there was but one despot, and nobody else left capable of forming a party.

It is doubtless necessary to adopt good maxims of government, but it is equally necessary to exercise some prudence and discretion in the use of them; for we may be ruined by the extremes of those very maxims, which, in their mean, are very salutary and useful.

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It has been suggested by some ill-minded people (but for the honor of Pennsylvania, I must think, without the least reason) that some Members of our General Assembly are deeply interested in stock-jobbing and speculations in certificates, and are possessed of, or concerned in, public securities to a large amount, which they are not the original holders of, but obtained by purchase at 6 or 8 for 1, and are now using all their endeavours, power, and influence, in the Assembly, under the sanction of their sacred public character, to procure a vote of the Assembly, for sunding their certificates, and, of course, to vote the money of their constituents by thousands into their own pockets.

I think it necessary that the honorable Assembly should take proper measures to vindicate themselves from such scandalous aspersions; and if there are any such members, to take the necessary care that one scabby sheep shall not spoil the whole flock. There can certainly be no more reason or fitness, that a Member of Assembly, under the sacred fanction of his public character, should vote the money of the State into his own pocket, than that a judge or juryman should fit in judgment in a cause, in the event of which he is personally interested.

We are told by some folks of delicate feelings, that “the public credit or honor is like the chastity of a woman;” and we all know that the wife of Cæsar ought not to be suspected; it will therefore follow, by consent of every body, that every cause of suspicion of the integrity and disinterestedness of our honorable Assembly should be removed as far as possible; and this is the more necessary, as our Assembly is a single Legislature, whose acts are not subject to a revision, or require the concurrence of another house; and of course, if they err, the subject is without remedy.

On these considerations there can be no doubt but our Assembly, and every body else, will be thoroughly penetrated with the necessity of having every member of that august body most effectually acquitted from all suspicion of interestedness, when they come to decide a question, which demands 3 or 4,000,000 of dollars from the State.

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I therefore propose, with all modesty, that when the great question shall be put finally in that supreme house, ‘Whether the public securities shall be funded,’ that there shall be some sort of voyer dire oath or test imposed on every member, to this purpose, viz. that he is not directly or indirectly possessed, interested, or concerned, otherwise than as an original holder, in any public securities, proposed to be funded, by the vote of Assembly now depending.

The principle of this proposition will doubtless be admitted by every body; and I conceive the Assembly will have no objection to the mode, as they are in their sentiments very favorable to test-acts. This method, I conceive, would set the character of the Assembly in the most unexceptionable point of light, and would give great dignity and weight to their decisions; and tho’ they might happen by this method to lose a vote or two, yet there is no doubt but they would have upright souls enough left, to make an ample majority in favor of any vote, which the real interest or honor of the State might make necessary.

It has ever been my fortune to write in the muns of popular prejudices; and in justice to my subject, and to my own judgment, I have often been obliged to mix some kind of censure on public measures, which were adopted by the leaders of the times, when I thought they were founded on principles of mistake and error, and tended to the ruin of the cause they were designed to support, and would, in their nature, operate in a manner very hurtful to my country. I accordingly met with little thanks; my rewards were such as any body may expect, who opposes the current tide of popular opinion, and the favorite plans of warm, zealous men.

I have sometimes met with that warmth and malignancy of censure, which can hardly be supposed to arise from an opposition to error of mere judgment, without some degree of corruption of heart. Yet time has evinced my most censured propositions to be necessary, and they have been adopted by our gravest and most dignified councils, and are now become very orthodox, and are justified by the sanction of general opinion. I therefore think I have some right to Edition: current; Page: [[304]] claim the attention of my fellow-citizens, at least I flatter myself I am intitled to their candor, while they read my propositions.

Nothing but my opinion of the vast importance of the subject of this Essay, could have induced me to write it. I had long determined to write no more on political matters; but when I came to see the State in danger of having some millions of the public money (in this our pressure of public debt) diverted from the objects who have every claim of justice to it, and lavished on people who never earned it;* Edition: current; Page: [[305]] and also to see a deluge of paper money rolling in upon the State, when I had not the least reason to suppose either that our public credit, in its present state of pressure and weakness, could support it, or that the quantity of our circulating cash (which is demonstrably quite sufficient) could bear such vast and sudden additions, without the most ruinous consequences. I say, when I viewed those matters, I really thought it a duty I owed to the State in which I live, to explain my sentiments, and, as far as in me lay, endeavour to avert these mischiefs.

I doubt not but the public will judge favorably of my intentions, and allow my arguments their due weight. The facts alleged are all of public notoriety; the reasonings are open to every man; and I have only to wish, that the reader may peruse this Essay with the same love of justice and truth, and the same zeal for the good, honor, and prosperity of this State, as occupied my whole breast when I wrote it.

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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.
[First published in Philadelphia, Jan. 2, 1790.]

WHEN the funding bill of Pennsylvania was published for consideration, five years ago, I wrote my Seventh Essay on Free Trade and Finance, in which I advanced sundry principles and arguments, which, perhaps, may apply as well to the finance of the Union in general, as to that of Pennsylvania in particular; and, of course, it may be necessary here, to repeat and revise many of the principles and arguments therein advanced and fully discussed; but a reference to that Essay will make a full enlargement on them unnecessary in this place.

In an Essay of this sort, it will probably be expected, I. That the monies necessary for the public exigence, should be stated: II. The resources out of which these monies are to be raised, should be considered: and, III, The mode of assessments and collections should be attended to.

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I am informed, that these will be the first great objects of attention in Congress, on the opening of the ensuing session.

My present design is, to state and advocate the rights and claims of a great and very respectable class of our citizens, whose distinguished merit entitles them to the justice, and, indeed, to the gratitude also, of their country, but who are, I fear, at least many of them, in danger of being neglected and losing the reward due to them, for the supplies and services which they rendered their country in the greatest public distress.

And the very money which is granted and paid by the country, for the just recompense of these worthy and deserving patriots, is, by a strange fatality of events, absurdity of reasoning, and perversion of counsel and right, I say, this money is proposed by some to be diverted from, and never paid to, them; but to be given to another class of citizens and foreigners, who do not pretend to any merit of their own, or to have earned any of the money, but whose claim and demand is founded wholly on the merit and earnings of these worthy citizens, who are, by the very plan, to lose it all, and get none of it.

The worthy patriots I allude to, are those who, during the war, when our country was overwhelmed with infinite distress and danger, rendered their services, supplies, and money in its defence, but who, on the adjustment of their accounts, could not be paid, by reason of the deficiency of the public finances of the States, and, therefore, were obliged to accept certificates of the balances due to them, with premises of interest and payment in future time.

These certificates were made payable to the bearer, and of course were negotiable, and were worth about 2s. or 2s. 6d. in the pound, their value being estimated by the current or common price, at which they were generally bought and sold in the public market; for the value of certificates, as well as of every thing else that becomes an object of general exchange or transfer, must, and ever will, be estimated by the current or common price it will bring in market.

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That the common price at which such certificates were generally bought and sold at the close of the war, was in fact about 2s. or 2s. 6d. may easily be made appear in a most incontrovertible manner, by the testimony of thousands and thousands, who bought and sold them the first year or two after the close of the war, when the great bulk of them were issued, and when the greatest sales of them were made by the original holders.

Since this period they have been hawked and jockied about by the speculators and brokers, like an ignis fatuus, at a great variety of desultory risings and fallings of price, according to the opinion, or whim, or caprice, or deception which happened to prevail in the minds of men at the time; the tracing or even considering of which, I conceive of no manner of consequence at present.

It follows from the foregoing observations, that the value of the public certificates, at the time of their being issued, may be easily ascertained; and so much the public creditors who received them, were paid, and no more, say 2s. 6d. in the pound; and the remainder, say 17s. 6d. in the pound, and the interest of it from that time, is still due to them.

That this remainder or balance ought to be paid to them, with the money which is, or may be, granted and paid by the public, for the express purpose of satisfying and rewarding these worthy citizens, for their dear and painful earnings in their country’s cause, and that the said money ought not to be diverted from this most just and valuable purpose, on any reason or pretence whatever; I say, that the balance which they have not received, and which, of course, is still due, ought to be paid to them, is a most capital object to be proved, urged, and enforced in the present Essay.

I shall attempt, and cannot doubt I shall be able, to prove to the satisfaction of every judicious reader,

  • That they are not yet paid;
  • That they ought to be paid;
  • That they can be paid;

And, to satisfy the grateful wishes of all our citizens, and to establish our national character of honor and humanity, Edition: current; Page: [[309]] both at home and abroad, That they must be paid.

For this purpose, I beg the candid attention of my reader to the following propositions:

I. No public creditor who receives a certificate, is thereby paid any more than the value of the certificate at the time of delivery, i. e. it is not the nominal value but the real value only, i. e. the current price of it, which is to be regarded in estimating the quantity of payment made by it.

When any body proposes to pay a debt in bills of exchange, bills of paper money, certificates, or any bills of public or private credit (if the creditor agrees to accept such payment) the first question that invariably occurs is, what is the exchange? i. e. no regard at all is paid to the nominal value, but reference is constantly had to the exchange or current price in market, in order to determine what amount of such bills shall be given to satisfy the debt. This practice is so universal among all men, and grounded on such manifest principles of right, that I cannot conceive that any man can be found, who will dispute either the reality or propriety of it.

The practice of Congress, the supreme council of the Union, affords a precedent of this same principle, adopted by them, respecting their loan-office certificates.

They published by their authority a scale of depreciation, by which the value of those certificates was estimated at the real exchange they had at the time of their dates, and the rate of their final redemption was fixed on the same principle.

All the States adopted the same principle, either by making use of the scale of Congress, or establishing scales of their own, by which the value of Continental money was estimated thro’ all the stages of its depreciation.

This practice of Congress and of all the States was founded not only on absolute necessity, but on the plainest principles of right; and if they made any deviation from justice, in the adjustment of any of their scales, this was no error in the principle, but merely a fault in the practice or use of it. And surely there can be no reason why the Edition: current; Page: [[310]] same rule (if a good one) of estimating the real value of certificates issued in 1777 and the subsequent years, should not be applied to the certificates which were issued at the close of the war.

But there is certainly great reason why our most virtuous citizens, who, by their patriotic efforts, services, and supplies, supported the war, and saved our country, should not be subjected to the loss of seven-eighths of their just dues, for want of such a rule, or some other means of saving them from such ruinous and shameful injustice.

Farther, let us appeal to plain, common sense on this subject. When the public accounts were settled at the close of the war, the public creditors were entitled to their several balances due to them from the States, in good hard money. Now can any possible reason be given, why a certificate worth but 2s. 6d. should be good payment to them, of 20s. at that time, any more than now at this time? I believe it will be readily admitted, that if any body (personal or aggregate) should, at this time, seriously propose to pay a debt of 20s. with a certificate or any thing else, which was worth but 2s. 6d. the offer would be rejected with every degree of contempt, as a most villainous and rascally insult.

Is there one Member of Congress, who would not think himself abused by the offer of a certificate worth 3-5ths of a dollar, in full satisfaction of six dollars, which he expects for one day’s attendance in the house? but how aggravated and keen, would be his feelings and chagrin, if he should neglect his family and private concerns, and attend Congress seven years, and, at the end of the term, should be paid off in certificates of the same depreciated value!

Or, do you think his vexation would be softened any, by being told, that tho’ his certificates were really worth at present but 2s. 6d. in the pound, yet the sum expressed on the face of them was 20s. in the pound, and therefore he must be satisfied with them as good and full payment, and if he would have patience to keep them long enough, they might perhaps bring him the full, real value expressed in them?

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I believe every Member of Congress will readily allow, that I have hit on what would be the true feelings of any of his brethren, and even of himself, in such a supposed case. If so, gentlemen, please to do as you would be done by; this rule of conduct is enjoined upon you by an authority much superior, and far paramount, to any you can lay the least claim to, in your utmost dignity, and fullest possession of sovereign power.

From all this it appears evident, that the public creditors, who have received certificates in payment, were paid no more than the current value or exchange of the certificates, at the time they received them. So much is paid and no more, and so much and no more they ought to be debited, and the residue of the debt, not having been paid, is still due to them.

It farther appears, that the certificates which were delivered to the soldiers and other public creditors, on the final settlement of their accounts, after the close of the war, were worth not more than 2s. 6d. in the pound, which ought to be debited to them, and the remaining 17s. 6d. in the pound, being unpaid, still remains due to them.

II. These balances which remain unpaid to the public creditors, ought to be paid as soon as possible. The sums due to them are their dear, their painful earnings; these claimants are the soldiers who fought, and the citizens who supplied them, when the salvation of our country was the great prize contended for; it is owing to their virtuous and strong exertions, that we have any thing left, either for our own enjoyment, or the payment of them.

We have no instance in history, of an army who discovered and practised more spirit, firmness, patience, discipline, fortitude, and zeal, either under the instant pressure of the greatest hardships and sufferings, or in the solemn and awful march to the most dangerous enterprises, or in the arduous moments of battle, than were found in our troops.

Nor did they hesitate or faulter in the least, till they had completed their great work, raised their own, their general’s, and their country’s honor and character to the utmost height, and reached the arduous goal which they had constantly Edition: current; Page: [[312]] in view, thro’ every stage of their fatigue and danger; this glorious goal was the complete liberation of one of the greatest empires of the earth, which empire we are, who sit clothed in all the majesty of empire, wealth, and power, solemnly deliberating, whether we shall pay these our deliverers, or not.

That “the laborer is worthy of his hire,” is the great doctrine of commutative justice, that divine law of nature, and nature’s God, which, in the utmost majesty of command, connects the quid pro quo, that august principle on which alone all thrones and governments can acquire and fix a permanent establishment; this sacred principle, I say, requires that these worthy claimants should be paid the money due to them, because they have dearly, nobly, and faithfully earned it.

There is in every human heart, a principle of right, a principle planted by the great Creator, ever approving the things which are most excellent; how far soever this sacred principle may become generally practical, emanate and spread in society, and govern and direct the general mind; yet the dispensation of public justice and right, lies in the power, and becomes the peculiar duty, of a few men, the chosen and dignified few, to whom the administration of the great affairs and interests of the nation are committed.

These dignified personages are sometimes called gods; they certainly sit in the place of God, and whether given to the people in wrath or mercy, are certainly appointed by him, and the sacred charge and duty of imitating his government lies on them; judgment and justice are the habitation of his throne; and these sacred virtues ought always to be found in our supreme council, not as transient persons who may be called in on favorite occasions, where their presence may be pretty well admitted, and their inspection may be tolerable, but as constant residents, who take up their dwelling there, as the place of their uniform habitation.

With a heart melted in sympathy with the sufferings of my country’s deliverers, with a sublimated sense of the Edition: current; Page: [[313]] importance, as well as sacred nature, of the justice and judgment of our nation, I most devoutly implore (and doubt not the concurrence of every honest American) that these sovereign and sacred virtues may dwell, not only in our supreme councils, but in the heart of every member who shall give his vote in the decision of this most capital and interesting cause which I am pleading.

Another thing which ought to induce us to pay these worthy citizens is, their brilliant success, and the most important benefits we derive from their exertions. I do not say that success simply is a virtue, but it is a very great proof of it, in as much as success generally follows prudent, spirited, and persevering conduct; nor do I say that rewards ought to be proportioned to the benefits received; for by this rule we can never pay enough to our deliverers; but where the benefits accruing from virtuous exertions are very great, they at least become entitled to a full compensation, and perhaps liberal minds will think a generous one might with great propriety be allowed.

We call general Washington, the father and saviour of his country, and with great propriety; the virtues of a father he might have possessed alone, but the saviour of his country he could not have been without his army. He indeed designed with discernment, commanded with prudence, and led on his troops with fortitude; but altho’ these virtues were carried by him beyond the power of imitation, the success must have failed, had not his army co-operated with his designs effectually, obeyed his orders cheerfully, and followed him with firmness; without these, neither his laurels could have been obtained, nor our deliverance have been completed.

They were his faithful companions in distresses, in dangers, in battles, in victories; they shared his fortunes, they shared his merits, and they persevered with him, till they also shared his final successes, which put a period to their long and patient labors, and our country’s calamities.

How would all the fine feelings of the human mind have glowed in the breast of that exalted general, if, in that period of triumphant and final success, he could have Edition: current; Page: [[314]] called these his dear and worthy fellow-laborers and fellow-sufferers together, met their brightened countenances with the warmest mutual congratulations, thanked them for their services, and dismissed them with such rewards, as would have enabled them to return to their families with some degree of advantage, as well as honor.

But I will draw a veil over the rest, and only say, the hard necessity of the times prevented this; the general knew it, the soldiers knew it, and submitted with patience to accept their discharge, and find their way home as they could, with empty hands and dry lips.

Is it possible that the great councils of America shall suffer such persevering fortitude, discipline, and patience to go without their reward? Generous allowances are not demanded; liberal appointments are not solicited; no more is required than the simple pay which was promised them by Congress; all they ask for, is the fulfilment of that sacred contract, which is grounded on the public faith and honor of an empire.

Indeed, I think that the patient and quiet behaviour of the real public creditors, both at the close of the war and since, entitles them to the highest esteem and respect of all our citizens, and should excite a very strong zeal, to make the most powerful efforts to do them right; it is certainly mean, base, and shameful, it is below the dignity of a nation, to deny or delay that justice to virtuous, quiet, and well-behaved citizens, which would be granted to tumult, uproar, and insurrection.

Will any man presume to say they are quiet, because it is not in their power to make disturbance? This is very ill-natured; but were it really the case, it would bring them into the rank of helpless persons, like the widows and fatherless, who have rights which they are not able to assert and support; these are entitled to the most peculiar and tender protections of the government; the wrongs and oppressions of such as these, are always ranked among the most horrid and cruel acts of injustice.

But I do not conceive this to be the real fact; all States have found that there may be as great force and strength Edition: current; Page: [[315]] in the still, small voice, as in the explosions that break the cedars of Lebanon; it is not commonly a fretfulness of temper in the people, but the cause of complaint, which breeds disturbances in a State; it is rare that people can be worked up into general insurrection, without some great and general cause.

Wrongs and oppressions diffused over a State will always sow the seeds of discontent; these sit easy on nobody; but always operate by way of fret and resentment, and are generally the causes of serious insurrections, and sometimes of most capital revolutions, in government; I know of but one sure way to keep the people quiet and easy in any government, and that is, to cause ‘justice and judgment to run down its streets, and righteousness to cover it.’

But it ought to be noted here, that tho’ the proper way to keep the subjects of any State in quietness, is to do them justice, yet it does not follow, that no men will be quiet under wrongs; many virtuous and good citizens will put up with injuries, and bear them with patience, rather than engage in pursuits for redress, which may make the remedy worse than the disease; few men would be willing to foment public disturbances, and make the land of their nativity a scene of desolation and horror, to gain redress of personal wrongs, or to gratify a spirit of revenge.

Many good men would patiently suffer injuries, rather than even give uneasiness to their oppressors, especially where the wrong happens to proceed from some near connection, a brother, a father, or perhaps the fathers of their country; but this virtuous patience under injury I deem highly meritorious, and deserving the utmost attention to their rights, and the redress of their wrongs.

But when the very people from whom redress is expected, begin to take advantage of the peaceable disposition of such a citizen, to think him void of spirit, and proceed to insult his wrongs, trifle with his demands, ridicule his pretensions, and plead absurd arguments in avoidance of his claims, arguments which are a burlesque of common sense, and which cannot meet the approbation of that discerning power, which the all-wife Creator has planted in every human Edition: current; Page: [[316]] mind, as the great index of right and wrong; I say, when insults of this sort are added to injuries, there is a point, a bound, beyond which human patience will not endure, and, of course, such injuries never will be offered to any person who is supposed to be in condition to assert and vindicate his own rights, or to resent properly the insults offered to him.

For example, let us suppose that the Continental army, officers and men, with those who, by their contributions, fed and clothed them, were all met together, with their august general at the head of them,* and, in this respectable state, should present their humble petition to Congress for their pay; do you think, gentlemen, that there is a man in all the States, either in or out of Congress, who would venture to tell them they were paid already, and bad no right to expect any thing farther from their country?

If a speech of this sort is supposable, it may be proper to consider it a little more particularly. I conceive that any speech directed to an army, the great subject of which is, to persuade them, after seven years’ hard service, to go off quietly without their pay, must necessarily carry in it materials somewhat rough, harsh, and not much suited to the tasle of the hearers; it will therefore, doubtless, be necessary to soften and sweeten it as much as may be, in order to insure its proper effect.

I will go on then to suppose, if you please, that some grave person of known wisdom, candor, and polished manners, should rise up to make an address to this great and respectable body of citizens, which, I think we may presume, Edition: current; Page: [[317]] might be pretty nearly in the following manner, viz.

“Gentlemen—I address you as most respectable citizens; your conduct has been noble; your merits are known to all the world, and acknowledged by all the States. Your arduous, persevering efforts have saved your country. What a pity is it then, that after so much worthy action, and so much triumphant virtue, you should be inadvertently betrayed into such an improper conduct, as to petition for your pay; inadvertently betrayed, I say, for I do not attribute your present application to any evil design; but to your having somehow imbibed very improper sentiments. I must be so free, gentlemen, as to tell you, you have been paid, fully paid already.”

Here the soldiers interrupt the orator.—“Paid already! fully paid! with certificates worth but 2s. 6d. in the pound, and hard work to get so much.

The orator resumes—“Have patience, my friends; do not interrupt me; I am delivering the sense of your country.

Soldiers. Is it the sense of our country, that a debt of 20s. can be paid, fully paid, with a certificate, or any thing else, which is worth, and will sell for, but 2s. 6d.?

Orator. “I again beg your patience a little, my dear friends; it is true, your certificates, when you received them, were indeed somewhat dull and low; they would not fetch more than 2s. 6d. in the pound, and hardly that; 2s. 6d. was the extent of the general current price of them; but surely you ought to consider this was no fault of the certificates; they were wrote on as good paper, and with as good ink, as need be, and 20s. was wrote on them as plain as could be wished; and not only so, but the public faith of the States, the sacred honor of your country, was annexed to that 20s. and solemnly pledged to make it good, and what could you wish more? Certainly, gentlemen, you cannot have the assurance to suggest, or even to think, that the public faith, the sacred honor of your country, was worth but 2s. 6d. in the Edition: current; Page: [[318]] pound! that their State-bills of 20s. were worth but half a crown.

Soldiers. We do not wish to enter into any conversation about public faith and honor; it seems to us, that this subject is not very proper to talk much of, at this time; for the least said is soonest forgot; but one thing we know and feel, that we could get no more than 2s. 6d. in the pound for our certificates; and our necessities obliged us to part with them for what we could get.

You will please to consider, sir, it is no small thing for people in our condition, to be deprived of seven years’ hard earnings, carved out of the prime of life, and to be left with nothing to begin the world with, or even to keep ourselves and families from starving.

Orator. “I do not blame you in this distress for selling your certificates; but you ought to have considered, that, when you sold them, you made over and transferred all your right to payment, for all your services and advances to your country, and, therefore, ought not to have sold them so cheap; you really hurt yourselves, and debased the honor and credit of the States, by that imprudent step; had you been wise enough to have sold them at 20s. in the pound, your necessities had been better relieved, and all this trouble and perplexity which you give yourselves and us, would have been prevented.”

Soldiers. You might as well blame us for not turning our certificates into joes and guineas; you know as well as we, that it was absolutely impossible to get more for them, or do better with them, than we did; we received the certificates made payable to the bearer, and of course, negotiable, and calculated to be bought and sold, i. e. to circulate like cash thro’ any and every hand; but we had no idea when we sold them, that we sold any more than we received; or that our selling them destroyed our demand on the States, for that part of our earnings which we had not received, and which was not paid to us; nor can we conceive, how our sale of negotiable certificates can operate on our real earnings like an enchanter’s wand, so as to annihilate them, or turn them into a mist.

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Orator. “I observe, gentlemen, you grow somewhat warm; I wish to avoid all ill-humor and hard language; you have deserved nobly; you have gained great honor; you have saved your country; and I hope, after all this merit, you will neither tarnish your own honors, nor disturb your country’s peace, by your uneasiness and discontent.

“What is done is passed and cannot be recalled; I earnestly recommend to you, my dear and honored fellow-citizens, to return home peaceably and quietly like virtuous and good christians, and go to work double tides, to raise money to pay the present holders of your certificates; for however foolishly you parted with them under value, yet the public faith is annexed to them, and must be supported.”

I appeal to every man in the Union, whether this address, or rather dialogue, does not state every fact and every argument, truly and fairly; and whether such a statement of facts and arguments would be likely to send the hearers home contented and quiet, without their pay; I trow not. If the above statement is not right, I challenge any body that can, to mend it; for my part, I freely own my opinion, that the whole harangue, tho’ ever so well-dressed and polished, is, and must be, from the nature of the facts, an insult not only on these worthy citizens, who rendered their supplies and services to their country during the war, but on common sense itself, and must wound the natural feelings of the humane mind, and which no man of honesty and candor could ever make in the absence of the parties, and which no man, who had any regard to personal safety, would dare to make in the presence of them.

The Orator’s plan is, to consider the certificates delivered to the public creditors, on the settlement of their demands, for supplies and services rendered during the war, to consider these certificates, I say, as full payment of the sum due to them, and to redeem the certificates at full nominal value, by payments made to the bearers of them.

It is farther a most plain fact, that the certificates were not worth more than 2s. 6d. in the pound, at the time they Edition: current; Page: [[320]] were delivered to the real public creditors, on the final settlement of their accounts, after the close of the war.

And it is a farther plain fact, that by far the greatest part of these certificates have been sold by the original holders, in their necessities and distresses, to persons who are now possessed of them, at 2s. 6d. in the pound, or at most for some trifle which bears but small proportion to the nominal value.

Now this plan, dress it, and cook it, and season it, and color it in any and every way you possibly can, if carried into execution, will most necessarily and unavoidably draw after it these two consequences:

1. That a sum of many millions of money must be levied and collected from the labor and painful earnings of the citizens of the States, not to be paid to the worthy citizens, who, by their supplies and services, during their country’s distress, have merited and earned it, but to be paid to numbers of rich speculators, who have no pretence of having merited or earned any of it, and who will, upon the earnings of those others, make a profit immense, not less in thousands of instances than 1000 per cent. Whilst,

2. The great bulk of the worthy citizens, who, by their supplies and services, really and dearly merited and earned the money, but who have sold their certificates (which is the case of by far the greatest part of them) must and will absolutely and finally lose 7-8ths, and very many even eleven parts out of twelve, of their real merits and painful earnings, from which shameful injustice, Good Lord, deliver us.

I beg leave here to ask the gentlemen who compose our supreme administration, legislative, executive, and official,

1. Whether they can possibly reconcile their own minds to any plan which involves such gross injustice?

2. Whether any of them could be prevailed on, at any time of their lives, on any consideration, to pay a private debt of their own of 20s. with a certificate, or any other depreciated paper, worth but 2s. 6d.?

3. Whether in heaven or earth (and farther we need not go) I say, whether in heaven or earth, there can be Edition: current; Page: [[321]] found a reason which can justify a minister of State, or any public man, employed in the dispensation of the justice and judgment of a nation, in devising or doing any thing, which, in his personal capacity, would wound his honor and conscience, and damn him to eternal infamy and contempt.

It is known to every body, that at the close of the war, our nation was bankrupt; at least they stopped payment, could not, and did not, do justice to those to whom they were justly indebted; and if we could not pay them when we ought, the only way to heal and remedy the matter, is to pay them when we can; and it is mighty plain, if we honestly mean to pay our debts, we must not only pay the whole money we owe, but must pay it to those to whom we owe it; for paying it to any body else can be no satisfaction of the debt.

Nothing can be more absurd than to apply the common rule of assignments of negotiable notes, bills of exchange, &c. to the public certificates; the exchange of the one rarely rises or falls more than 4 or 5 per cent.; the depreciation of the other is 15 or 20 times as much, and is so enormous, that the principal value is absorbed by it, and not more than 1-8th or 1-10th part of the nominal value in reality remains; here is an extreme case indeed, and it is well known that every law, right, or rule of morality is limited to its mean or reasonable application; the moment it diverges therefrom, and flies into its extreme, it loses its rectitude and equity, and becomes injurious and wrong; and the sure and infallible criterion of such extreme, is when such application operates by way of injustice and destruction of right.

And in the case in point before us, the application of the common rule of assignments, to the certificates, has a necessary operation, most cruel, injurious, and hurtful in two respects:

1. It takes an immense sum of money from virtuous citizens, who dearly merited and earned it, and subjects them to a total and ruinous loss; whilst,

2. It conveys the same immense sum to other men, who never merited or earned it all, and gives them an enormous Edition: current; Page: [[322]] profit of 1000 per cent. on the merits and earnings of the losers.

This whole doctrine is so perfectly known and familiar to all doctors in law and morality, that they have adopted it for a proverb or maxim, summum jus, summa injuria, i. e. right in extreme becomes extreme wrong; and nobody ever pretended to dispute this maxim, who was not either most poignantly pressed with argument (in which case the schoolmen will make any shifts) or hurried and impelled by some favorite scheme or interest, out of all their philosophy, decency, and common sense.

There is another plan or method of doing this business, which appears to me much more just and equitable, and quite as easy as the one I have been exploding, viz. Let every certificate be estimated by a scale of value, grounded on the current price or exchange of it at its date, and at this value let it be debited to every public creditor who received it, and at the same value,* or at the current value (as the case may Edition: current; Page: [[323]] require) let it be redeemed, with interest from its date to the time of its redemption, and let the remainder of the balances due to the public creditors, who have received certificates, be paid them in money with interest, as soon as that can be done.

I know no reason why the real or current value of the certificates in question should not be fixed by a scale, as well as the loan-office certificates, and other depreciated public paper, during the war; this principle, as I before observed, was adopted not only by Congress, but by all the States, as a matter of both justice and necessity, and the tender-acts and other infringements of this plan, were found totally wrongful, and, of course, were repealed.

No human plan of dispensing commutative justice to a nation, can ever be perfect and wholly free from error; all that human wisdom and human virtue can do, is to adopt that plan, which, in its operation, shall produce the most justice and right, and the least injury and wrong, of any that can be devised, and carry the plan into effect by the most equitable administration which can be practised.

If this then is a good rule or criterion of a good plan (which certainly no man can seriously deny) let us try the two plans by this infallible touchstone, viz. which of them, in its operation, will produce the most justice and utility, and avoid the greatest injury and wrong.

1. The justice and utility of the one is reduced by its operation to almost nothing, whilst the injuries and wrongs it Edition: current; Page: [[324]] produces are enormous, detestable, and almost infinite; no less than depriving numberless citizens of 9-10ths of the reward due to their great merits and services, and subjecting them to a final and total loss of the same, whilst it heaps the immense wealth (which is their due, and which they lose) on another class of men, who have no pretence to any merit at all.

2. The other plan gives to those meritorious citizens all the rewards to which they are entitled, and if any injustice has been done them by the long delay, it is in some measure made up to them by the interest it proposes to give them, whilst it gives to the purchasers of alienated certificates, the same price for them which they were worth when first issued, with interest from that time till their redemption; and I think this is all they have a right to expect, and we may very well say to each of them, Take what is thine own with usury, and more we will not give thee.

If this class of men sustain any loss, it must arise from their having purchased certificates at a higher exchange or price than they bore when they were first issued, and this is a loss to which speculations of that sort are always exposed; if any of our rich and enterprising citizens are disposed to deal in stocks, gamble in the funds, or to be concerned in any negotiations of hazard whatever, they all expect to be liable to a run of ill luck, as well as to good fortune; and I do not know that the public have much occasion to trouble themselves about either their profit or loss.

But if the losses of these men should be thought pitiable, they certainly, in either magnitude or distress, bear not the least proportion to the heavy, ruinous losses, which our most virtuous and meritorious citizens must sustain on the other plan; much less can they justify the adoption of a plan in their favor, which will deprive our most respectable citizens of the immense sums due to their painful merit and services, in order to lavish the same away on these adventurous speculators, and thereby accumulate the fortunes of the one, and the distresses of the other, to a degree almost infinite.

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But after all, if the losses of these speculating gentry must be thought to require compensation, I beg it may be made by the public, but by no means let it be carved out of the dear merits and earnings of the noblest patriots of our country.

But the sacred duty of paying these worthy citizens, who have done and suffered so much for our country, and from whose noble exertions we actually derive and enjoy most inestimable benefits, is not only enforced on us by every principle of justice, honor, and gratitude; but it is farther recommended by many advantages and great inducements of interest, which are either involved in it, connected with it, or consequential from it. It may be proper here to mention some of these.

The reverence and respect which we owe to general Washington, ought to induce us to pay with punctilious honor and justice, these his faithful followers and fellow-laborers; it is known only to God, and the humane heart of that august commander, what anguish of mind, what poignant sensibility of regret and compassion occupied his breast, at the close of the war, when the exhausted finances of the country reduced him to the dreadful necessity of dismissing his faithful followers without their pay, and leaving them to find their way home as they could, without a shilling, either to relieve the distresses of their families on their return, or even to buy a cup of good liquor to recruit their exhausted spirits, or make their meeting cheerful.

It is known only to God, and to the humane heart of that august commander, how animated, how alive would be every fine sensibility of that great man, how dilated his whole heart, could he be informed that the justice and gratitude of his country would furnish the reward due to the virtues and merits of these his worthy followers and supporters.

With what a suffusion of pleasure would he hasten to find out these noble spirits in their retreats of obscurity and distress, extend to them the welcome relief, and sympathize in their joy and gladness; is it possible we should hesitate to indulge a man we reverence and esteem so highly, with this Edition: current; Page: [[326]] gratification, in which every good heart in our nation would sympathize, and which every feeling of honor and compassion strongly requires of us?

On the other hand, do you think he could bear a disappointment in this, with his usual equanimity? He can bear hardships and dangers, he can bear a retreat before his enemies, he can bear the horrors of war, and the dreadful collisions of a battle, he can bear the joys and triumphs of victory, he can bear final and decided successes, and he can bear the universal applause, gratitude, and melting hearts of his fellow-citizens; I say, he can bear all these with that heroic strength of mind, which, indeed, feels every incident, but can control every passion into calmness and decency.

But were he to see the immense sum of money due to his companions and supporters, twice earned, first by their toils and supplies, and then again by the citizens at large, out of whose labor the money was carved and collected, were he to see, I say, this immense sum all swept away into the coffers of those who never earned any of it, whilst his dear companions were left to lament, in remediless despair, the savage injuries of their country, the disappointment of all their last expectations, and the hopeless ruin of their fortunes and families; this, I think, would be too much for his mighty fortitude to sustain, would shake that firmness of mind, that great power of self-command, which perhaps forms the most inimitable part of his character; and what has he done, that you should subject him to this insupportable mortification, this agony of sympathizing wo?*

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I do not mean by all this, to suggest that the simple humor or caprice of any individual, however dignified, ought to be the basis of any public measure, in which national interests are concerned; but where any man exists in a nation, whose long practice and example have demonstrated that all his powers are directed by wisdom, all his passions are controlled and governed by discretion, and every action excited and animated by virtue and patriotism, I say, to form public acts agreeable to the wishes of such a citizen, is paying court to virtue itself.

Whilst, at the same time, the government makes a very high compliment to the great body of the people, in supposing that their minds are all under the influence of a similar virtue and patriotism, and, of course, that it is highly proper to propose such an act to their approbation, on full presumption that a public act, dictated by the wishes of such an illustrious citizen, would certainly meet with a co-incidence of sentiment in the people at large, and, of course, must be equally grateful to their wishes also.

I do not offer this as an airy compliment to the citizens of the States; but I do most seriously believe, that the wishes of our august general, in the case before us, and those of the great body of our people, are the same, or at least, similar; the operations of the war being under the direction of the general, and the more important parts, both of action and events, happening under the inspection of his own eye, will doubtless excite in his mind more lively sentiments of many things and circumstances, than the people at large can have; yet I think the conduct of those worthy patriots who supported the war by their supplies and services, meets the approbation of the people in so universal a manner, that very few can be found, who would not sincerely join their august general, in wishes that they may be paid. This leads me to observe,

III. That the patriots who supported the war by their supplies and services, not only ought to be, but in fact can be, Edition: current; Page: [[328]] paid. Let their merits be ever so great, and our obligations to do them justice be ever so sacred, yet if our case was such that we could not pay them, no more need be said on the subject; but if we can pay them, and do not, one would think that heaven and earth would rise in their favor, and revenge their wrongs.

To prove that they can be paid, the following facts may, and doubtless will, be admitted to be true and convincing evidence.

1. That the country is rich enough to pay them: 2. That the people are generally convinced, that the debt demanded is justly due to their merits and earnings: 3. That they are willing to pay them: and, 4. That our government, or supreme council, is also willing to pay them, and vigorously to set on foot and pursue the ways and means proper to effect it.

1. That the country is rich enough to pay their deliverers, is too manifest to admit a doubt, or need any proof. It is easily demonstrated, that an additional impost on imported luxuries (such as spirits, wines, silks, jewellery, &c. &c.) but barely high enough to reduce the consumption down to that moderate degree, which is really necessary to the health, wealth, and morality of the inhabitants, would make our finances amply sufficient to pay every shilling we owe to these worthy citizens, and not this only, but also to discharge every other debt which either honor, justice, or gratitude demands of us.

2. That our people are generally convinced that the money demanded by these worthy citizens is justly due to them, is abundantly manifest from many considerations: 1st. They have discernment enough to know that a debt justly due will always be due until it is paid. That long delay of payment is no extinguishment of a debt. 2d. I believe their genius rises high enough to comprehend, that a debt of 20s. cannot be paid and satisfied by a payment of 2s. 6d. or, which amounts to the same thing, that the whole is greater than a part, or that 20 of any thing cannot be balanced or equalized by an eighth part of the same thing.

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3. That our people at large are universally willing to pay these worthy citizens, is also very manifest.

1st. The habits of morality are strongly impressed on our people in general. The country is not old enough to establish vice, oppression, and injury, or to obliterate the natural index of right and wrong, in the human mind: in the old countries, the luxury of an individual may consume the labor of thousands; a nation may be taxed and oppressed to support the lust, pride, and haughty grandeur of a few; a court of inquisition may be instituted to force the mind, and infringe the rights of conscience, and the people will bear it; but with us it is otherwise.

In America, oppressors have not lost their shame, nor the oppressed their resentment, nor the people their natural sense of good and evil; when these worthy citizens exhibit their merits and services, show their wounds, and plead their constitutions and fortunes broken in the cause of their country, and cry for their pay, the general mind is instantly affected, a sense of both justice and compassion is strongly excited, and the universal wish and murmur is, ‘let right be done,’ and, ‘why has it been so long neglected and delayed?

2d. For the truth of the fact, I appeal to every man in the States, whether, within the circle of his acquaintance, there does not prevail a general pity for the soldiers and other liberal supporters of the war; a decided opinion and high sense that they have been injured and ill used; and a strong and sincere wish that they may be paid: as far as my acquaintance with my countrymen extends, this wish is almost universal, and if any exception can be found, I conceive it must be among two classes of people. 1. The present holders of alienated certificates, some of whom, I suppose, wish to grab and secure to themselves, the rewards due to the merits and services of these worthy patriots. 2. The other class are those who always abhorred both the war and Revolution, and are therefore well enough pleased to see all those who were concerned in promoting both the one and the other, most effectually mortified and disappointed. This leads us to consider,

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4. The happy facility and ease with which our supreme council can adopt the measure of paying these worthy, injured citizens, and put into most effectual operation the ways and means necessary to accomplish it; nobody doubts that this is the ardent wish of their hearts, or that they will speedily adopt the favorite measure, and vigorously support and push it to its final effect, and thereby demonstrate to the world, how strongly they are animated and gratified with the pleasing task of repairing the wrongs of our injured citizens, and restoring the justice, honor, and dignity of our country.

By large and repeated trials of the temper of our people, we find that they will bear great pressures and burdens, and will freely devote their services and fortunes for what they deem to be the good of their country, for objects which fall in with their wishes, and meet their approbation; this temper will enable government to institute any proper modes of supply, for the payment of our worthy patriots, when that very payment is the favorite wish of the people who are to pay the tax which is collected for that purpose.

Two different bodies of claimants now present their demands on government; these worthy patriots are one of them; and the present holders of alienated certificates are the other; it will require equal sums of money to pay either of them; the only question is, which of them shall have it? but I conceive, that the difficulty of raising the money for the payment of each of these, will not be by any means equal, but extremely different.

This brings into view another consideration, which, in the present state of our finances, appears to me of great moment; our revenue system is young and tender, and it is of great importance to introduce the practice of it, and get it formed into a sort of habit in the States as soon as possible; and this may require delicate management; if taxes are called for in ways, and for purposes, which are generally approved, the collection may be made with little difficulty and few murmurs; but if immense sums of money are demanded in ways that are disgusting, and for purposes not generally approved, and perhaps abhorred, the difficulties of Edition: current; Page: [[331]] collection will be great, and the murmurs, infinite; this may bring embarrassments on the revenue, which we may long feel very sad effects of. To apply this to the case before us—

A large impost laid purposely for the payment of the real supporters of the war, will meet the approbation, and coincide with the wishes, of the great body of our people, and, of course, the collection will be made with ease and good humor; but let our people be told that this immense sum, which is levied for that favorite purpose, when carried into the treasury, is not to be given to those favorite patriots, but is to be grabbed up by another class of men who have no pretence to either service or merit, but claim only what is due to the merits and the services of the others, I conceive, in this case, that all good humor will take its flight in an instant, and murmurs plenty and sour enough will ensue.

What effect such general murmurs, complaints, and discontents may have on the revenue, may be easily foreseen, and I should be glad to know, that these mischiefs would end with the revenue, without extending farther to disturb and derange the general police of the nation; the least mischief which can be expected from this general dissatisfaction may be, that it will furnish a plausible excuse or plea for smugglers and those who wish to defraud the revenue, viz. that there cannot be much harm in eluding a tax which is levied for the very purpose of satisfying claims, which are, in their nature, wrongful, and not grounded on any such valuable considerations, as the laws of commutative justice make essentially necessary to the existence of any rightful transfer of property.

I imagine it would be pretty much in vain for government to attempt to compose all this confusion, and pacify the general ill humor, by holding out an old law of trade, or mercantile rule (good enough, indeed, within its proper limits) but which is racked and tortured far beyond the reach and influence of that reason, on which alone all its fitness and propriety ever did, and ever must, depend; and which is stretched to such a degree of extravagance, as no Edition: current; Page: [[332]] nation under heaven ever thought of adepting into practice; and which no man of common sense can ever reconcile to that natural sense of right, which exists in his own mind; I mean the old law or usage of assignments.

I do not recollect more than two instances which ever happened in Europe, of stock, bills, or certificates (for they are all different names for the same thing) of such magnitude as to affect national credit, the variations of exchange of which ever were so great as from par to 8 for 1; these two instances were, the Mississippi scheme in France, in 1719; and the South-Sea scheme in England, in 1721.*

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These were both established and authenticated by acts of the supreme legislature; acted under the inspection and control Edition: current; Page: [[334]] of it; were the channels thro’ which the public monies were circulated; and the final accounts of both were settled and adjusted under the direction and authority of the same supreme power of the respective nations. These schemes were so extensive as to affect national interests; most of the monied men in both nations were deeply concerned in them, and when the enormous and ruinous effects of that great variation of exchange, which these stocks suffered, came to be be generally felt, applications without number were made to government for relief.

Very strong remonstrances were made against the interference of the legislature, and that the matter should be left to the course of common law, i. e. to be decided according to the common rule of assignments of all negotiable notes, bonds, &c. But on a close inspection of the matter, it was soon clearly seen, that the variation of exchange of these stocks (or their depreciation, as we call it) was so enormous and extreme, that any application of the ordinary rules of law and practice to them, would produce the most ruinous injustice and wrongs, and, of course, every idea of that mode of settlement and adjustment was instantly given up.

Their great principle was, that justice and right was the grand end of law, and paramount to any particular rules or established practice, and, of course, ought to control them in all cases of so extreme and extraordinary a kind, as could not fall within the reason on which those rules were founded, but so circumstanced, as that an application of these common rules would unavoidably produce such injury and wrong, as was totally destructive of all that right which was the essential principle and end of all law.

Upon full consideration of all this, by an act of sovevereignty they adopted the most equitable principles, which they could devise in those great confusions, which would apply to the particular cases that lay before them, and which would, in their operation, produce the most right and avoid all wrong, in the best manner they could think of.

The English House of Commons went so far as to suspend all judgments and executions recovered upon any contract, Edition: current; Page: [[335]] for sale or purchase of any stock or subscription, and also ordered that all persons, who had become indebted to the Company for South-Sea stock, &c. should, on payment of 10 per cent. be discharged from any farther demands. They made many other resolutions (which were afterwards made acts of parliament) totally repugnant to the common rules of law and practice, but absolutely necessary to be adopted in those extreme cases, to which these common rules could not be applied without the most manifest and ruinous wrongs and injustice; wrongs of such magnitude as to affect the trade and credit of the nation, as well as to bring remediless ruin on thousands of individuals, and, at the same time, heap immense fortunes on others who had never deserved them.

I know very well that great pains were taken in France, to throw much odium and blame on mr. Law, and to make him chargeable with the great and ruinous mischiefs of the Mississippi scheme; and the same industry was used in England, to cast blame on the directors of the South-Sea Company, and to father the pernicious consequences of that scheme on their corruption and mismanagement.

But tho’ it may be probable enough, that in schemes of that vast magnitude and national interest, faults in the management might be found, which are always made to rest on the prime movers and directors of them, yet the most capital and destructive mischiefs sprung from the nature of the schemes themselves, and would necessarily happen (tho’, perhaps, not in every possible excess and aggravation) if the same plans were to be set on foot a thousand times over.

But as these schemes were established under the sanction of the Legislature, in the fullest manner that could be devised, it was not quite decent to admit in the national assemblies, that their mischiefs flowed from their nature, but the blame must be thrown on somebody, as some stupid committees, in the late times, attributed the depreciation of the Continental money to the merchants.

This, to be sure, in England, was natural enough, where they adopt this principle, that when popular discontents rise very high, one man must die for the people, i. e. one or Edition: current; Page: [[336]] more victims must be sacrificed, like scape-goats, to appease the people, and thereby parry the reseniment due to the minister, or prince, or Parliament, or other principal, from whose folly or misconduct the mischief originally proceeded; witness, admiral Byng, and many others.

But let the mischief originate wherever it might, the grand object of attention was a remedy, and this, doubtless, engrossed and occupied the whole wisdom of the legislatures and the respective nations, at the time; for whilst their great interests, both national and individual, were rapidly melting down under the fatal influence of these destructive schemes, even supreme councils were willing to hearken to advice; and, therefore, we may well presume that we have an example of the most consummate national wisdom that could be collected, in the modes of remedy which they adopted.

Nor does any body suppose that one man in England expects that their national debt will ever be paid at par, tho’ the present discount or depreciation is but about 25 per cent.; or that more interest will be paid than the real value of these stocks or certificates require; the present interest paid on them being 3 or 3½ per cent. whilst the common interest of that country is 5 per cent.

I do not pretend to refer to any thing, which might be done in the old days of barbarity and ignorance; but I do not recollect having ever heard of one modern prince or State in Europe, who ever attempted to pay his soldiers or other public creditors, in certificates, or stocks, or negotiable securities of any sort; except when such payment made a part of the original contract, as the contracts for navy supplies are payable in navy bills, &c. All that I know, which is at all like it, is paying armies, &c. with base coin, which some princes have done; but this was a State-cheat universally detested; nor could all the authority of such prince ever give such base coin a currency beyond its real value; nor did I ever hear of much it being called in and redeemed at full nominal value.

This I take to be the practice of the nations of Europe, in cases familiar to the one I am pleading; and, I think, a very little diseretion on our part might induce us to imitate Edition: current; Page: [[337]] their prudence and virtue, profit by their example, and avoid their errors.

But it may, perhaps, be more important to our internal quiet, to advert to what has been the practice of our own States in similar cases; for any innovations, or departure from known usages and customs among ourselves, may give more dissatisfaction to our people, than any deviation from European practices, which, tho’ perhaps equally wise, yet are less known and considered among us, than our own.

The loan-office certificates issued by our own supreme council during the war, are all estimated by a scale, the principle of which is the value of them at the time of their dates; the value of our Continental and State money has been estimated by either the general scale of Congress, or that of particular States; this method was indeed neglected too long, but was at last fully adopted, upon the plainest reason and most urgent necessity; and when our Continental and State money depreciated down to nothing, it all died where it was; nobody ever thought of appreciating it again, by a redemption at its original value.

The Old Tenor and other bills which had a currency in many of the States long before the Revolution, were redeemed at their current exchange, without the least regard to their nominal value.

And can any possible reason be given, why we should adopt an innovation (proposed and urged by many) respecting the certificates in question, which is a total departure from the constant practice of all the States before, at, and since the Revolution, in all cases of similar reason; an innovation, which, by its natural and necessary operation, must and will not only produce immense and ruinous wrong to numberless individuals of most deserving citizens, but will also disgrace and disparage our public credit, honor, and dignity, and discourage the confidence of our own citizens and foreigners in our national justice and morality?

Indeed, the ordinary rules of law would do infinite mischief and injustice, were not the rigor of them to be softened and corrected by chancery; the powers of chancery ought always to control the common law, whenever, in any case, Edition: current; Page: [[338]] the application of the ordinary rules of law will manifestly destroy right and justice, or work a wrong; for law is certainly perverted and needs correction, whenever it destroys right, or does wrong.

The supreme power of every State is the supreme chancery of it, and always hath, and must have, sovereign authority to repeal, to limit, or control every rule of law; and may, and ought to, do it, whenever that rule operates by way of destruction or defalcation of right, or producing of wrong, for justice and security of right can never be perfict, or even tolerable, in any State, without the existence of this power, and the prudent exercise of it.

When all the foregoing reasons, the practice of all our own particular States, and also, that of our own supreme council, as well as that of all the States of Europe, in similar cases, as far as their practice is known to us; I say, when all these things are duly considered, I think my great conclusion will be admitted very readily, viz.

That our most deserving and patriotic citizens (whose cause I have been advocating) must be paid; that the wishes of our own citizens require it; that our character of honor and justice, both at home and abroad, requires it; and that we shall be deemed by the nations of Europe, the veriest novices in policy and finance, as well as knaves in practice, if we do not do it.

I will subjoin one short observation here, because I think it of great importance, viz. it is the great interest, duty, and honor of every government, not only to pay their contracts honestly and in good season, but also to grant proper compensations to all their citizens, who, by patriotic exertions, deserve the notice and rewards of their country; this will enable government at all times to command every possible exertion of their people, either in the way of services or supplies, and will induce them to hasten with cheerfulness and pride, to offer to government any thing they have or can produce, which the public service stands in need of.

Whereas, if these noble spirits find themselves neglected and forgotten, and that in their country’s service they have Edition: current; Page: [[339]] labored in vain, and spent their strength for nought, their zeal for the public service will become very languid, and not only so, but the example of their disappointment will operate by way of great discouragement of their neighbours. Nothing animates and keeps up the spirit and good-humor of a nation so effectually, as a full confidence in the justice and gratitude of its government; and this is the deepest and firmest foundation on which the wealth, the peace, the honor, and the establishment of a nation can be built.

For this great purpose, excessive and extravagant allowances are by no means necessary, but are even criminal, when the finances are low and straitened, for we ought, at least, to be just before we are generous; the honor of the service and the acceptance of government, are the grand inducements to noble, patriotic actions; and moderate compensations, adequate to the services and merits, will be perfectly satisfactory; more than enough need not be given to any one, for that will make it necessary to give less than enough to some other.

On the whole, raising the great sums of money necessary to satisfy all the real public creditors, will, under proper management, be no great burden to the States; the levying them as fast as the honor and justice of the States require, will not impoverish them. Large sums collected from the body of the nation, if they are paid out again and disiributed over the same nation, especially if the collection is principally made from the richer sort, and the payments made to the poorer sort (which will be the case, on the plan I propose) this tax, I say, will rather prove a benefit than a burden.

It will increase the circulation of cash; it will stimulate industry; it will enable thousands to pay their debts, who otherwise could not do it; and, of course, it will enable thousands to receive the debts due to them, who must otherwise lose them; it will enable very many poor to support themselves, who otherwise would be a burden on the public or private charity; it would tend to equalize the wealth of the community, by giving every one his due portion of it; Edition: current; Page: [[340]] and thereby prevent the riches of the country from aceumulating in few hands, &c, &c.*

These are no small advantages resulting from taxation; and, I think, their effects on the nation at large will compensate the burden of it, and probably yield a balance of advantage: especially if the tax should be levied by an impost on imported luxuries, and thereby lessen the consumption of useless and hurtful articles; which would operate to the benefit of the community, even if the money produced by the tax was all thrown into the sea.

This mode of taxation may easily be made adequate to all the exigencies of the State, and leave no occasion of reverting to either an excise or direct taxation, both of which will be much more difficult in their assessment, more expensive in the collection, more disgusting in the mode of demand, more burdensome to the subject, less equable in pressure, and much more uncertain in the product.

I now, with the utmost confidence, submit it to the heart, to the feelings, and to the conscience, of every citizen of the States, that I have exhibited proofs, not barely Edition: current; Page: [[341]] sufficient for full conviction, but so plain, that any person must put violence on himself, who will not be convinced,

I. That the real public creditors, whose cause I am pleading, have not yet been paid; this is as plain as that 20s. is more than 2s. 6d.

II. That they ought to be paid, with the first monies we can get; this is as plain as that “the laborer is worthy of his hire,” or, that contracts made on valuable consideration given, ought to be fulfilled.

III. That I have exhibited such a statement of our finances or resources of supply, as demonstrates that they can be paid; that the payment of them would not be a burden or distress on the country, but rather a benefit, a manifest advantage, to our people at large: and,

IV. That from most essential considerations of public justice and honor, of national character, both abroad and at home, and of the internal peace and establishment of our nation, it follows most clearly, that they must be paid.

I do not know any thing farther necessary or that can be done, but to give this Essay some inscription, which may direct it to some particular attention; for that which is offered to the public at large, is generally considered as every body’s business, and so is apt to be in fact nobody’s, and, of course, becomes neglected.

As I mean, in this Essay, to plead the cause of national justice, I wish to address it to Congress, and beg the patronage of that august body;

Not merely because they are the fountain of national justice, and their decisions alone can administer the remedy which I solicit; but also,

Because many very respectable personages, who now compose that supreme council, were, during the war, either concerned in the most capital public transfactions in the cabinet, or were officers of most distinguished rank in the army; and therefore, by near inspection, were enabled to judge in the best manner, not only of the importance of the merits and services herein urged; but also of the spirit, fidelity, and patriotism, with which they were rendered to the public; and also,

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Because I wish to set up the claim of these worthy, deserving patriots, along side of that of the present holders of certificates, who (I am told) have presented their petition to Congress, in which they count very largely on the merits, services, and sufferings of these worthy citizens, of which they exhibit pathetic and very moving descriptions, but after all, very modestly request, that the money due to these very meritorious citizens, may be paid to themselves.

I think, I can introduce my friends at least under the advantage of old acquaintances; whereas the others, I conceive, are mostly new faces.

I have great confidence, that my plea for citizens of such merit and respectability, will meet at least the attention, if not the approbation and patronage, of Congress.

But after all, if it should be the final determination (which I cannot suppose) that the certificates shall be considered as full payment to those who received them, and that nothing is now due to any but to the possessors of those certificates, I have one more motion to make, viz. that the original holders of these certificates should be preferred and first paid, as claiming payment of debts of an higher nature, and grounded on greater merit, than the others can pretend to.*

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I know that Congress, like all other similar bodies of supreme authority, must necessarily have a great variety of important, different, and sometimes, contending interests, referred to their decision; and, of course, the several parties will use all possible arts, address, and influence in their power, to bend the mind of that august body to their several wishes.

It is very difficult for any body of men, thus beset and surrounded (if they have any passions or prejudices at all) to pursue a course perfectly direct, and free from error; yet so very important and consequential is every decision they make, and every measure they adopt, that the fate of millions hangs on their lips, and the fortune of millions is balanced by the motion of their hands.

Therefore, under a due impression and sense of both the difficulty and importance of their stations, councils, and actions, all good men ought to be candid in their opinions, moderate in their censures, and very zealous and sincere in their prayers that Almighty God would, in all their difficult consultations, give them that wisdom which may direct and lead them to such decisions as may be conformable to natural right and justice, conduce to his glory, and establish the peace, happiness, security, and best good of our country.

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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.

I. THE finances or management of the stock or revenue of every State or individual, from the greatest Empire down to the least Republic, from the highest company to the lowest partnership, from the richest landholder or merchant to the poorest peasant or pedlar, determines their fortune or fate, is the great principle out of which their peace and plenty, or their embarrassment and straits, must grow, and from which must proceed their final honors and success, or their disgrace and ruin.

This subject, of course, becomes an object of most capital concern, and ought to be an object of first consideration, both of every community and also of every individual.

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Therefore, when any plan, either of political manœuvre in a nation, or business in lesser communities or individuals, is in contemplation, to count the cost becomes an indispensable part of the deliberations.

And when the cost is properly computed or counted, the next thing is, to look out for and find revenues or incomes sufficient to pay it.

An error in either of these, i. e. a wild calculation of the expense of any proposed plan, or a wild and deficient estimate of the income or revenue sufficient to pay it, is the common and usual cause of bankruptcy, breach of faith, and loss of credit, in both the one and the other, and of all the disgraces, embarrassments, and other ruinous consequences which must flow therefrom.

II. The capital stock of a nation or individual is the wealth each possesses, and the resources which are with certainty within their power; but the more proper and safe way of computing the stock is rather by the yearly income or revenue, than by the capital; because if the annual expenditures exceed the annual incomes, the capital stock must be left in debt at the end of the year, which, if continued, must soon produce embarrassments and straits, and even bankruptcy in the end.

It often happens that much valuable property is so conditioned, that it will not produce any yearly income, or, at most, not any that is adequate to the interest of its value; therefore, it would be very imprudent for a nation or individual to make calculations of yearly expenditures, grounded on such estates, for they will fail of supply otherwise than by way of mortgage, which ought to be avoided as a last, because it is a fatal, resort.

III. But let the stock or finance of a nation or individual be ever so good and affluent, yet every advantage of it must and ever will arise from, and be limited by, the justice, honesty, and truth, with which it is negotiated or administered. Honest payment of just debts, and fulfilment of contracts, are most essentially necessary to give either a nation or individual the command and control of all the supplies and Edition: current; Page: [[346]] services, which can be furnished within the circle of their influence.

For all persons will hasten with eagerness to render all supplies and services in their power to an honest, grateful paymaster, and will avoid, with a proportionate reluctance, furnishing either the one or the other to a dishonest, dilatory, or trickish paymaster.

And, of course, all supplies and services, in the one case, will be obtained in the easiest, quickest manner, and will be executed and rendered in the highest perfection (as there will be choice of materials, stores, and workmen) and in the cheapest way, and at the lowest rates.

But, in the other case, both the supplies and services will be embarrassed in their acquirement, will be executed and rendered in deficient manner, and at very high prices; for every one is loth to deal with a bad paymaster, nor will suffer himself to be engaged or employed by him, unless he is impelled by some urgent necessity, or induced by the offer of very high price, or great emoluments.

IV. Economy and prudence in expenditures is absolutely necessary to the obtainment of the great advantages and benefits of the revenue or national stock; without this, that justice and honesty in the management of the revenue can never be practised, which is essentially necessary to its ends and uses: for if the revenue or stock is wasted by needless expenses, those which are necessary must be unprovided for; if large, fictitious, and groundless demands are accepted and paid, debts which are by honor, contract, and real merits, justly due, must lie unpaid.

This operates not only to the great injury of the real creditors, but also to the embarrassment of the whole community; for every branch of business in the nation stands connected with the public finance, as the public debts are great and extensive objects of dependence and exchange, and, of course, any disappointment in these will generate innumerable disappointments in the course of currency thro’ which they ought to pass, and, of course, will either directly or remotely affect every branch of business.

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We have had late and large proof of this kind of vexation, in the numberless instances of persons who could not carry on their business, or pay their debts, because they were disappointed of receiving monies due to them by the public: such a mode of financiering as this will ruin any nation in the world.

The foregoing propositions and remarks I consider as maxims or first principles, which force the assent of the mind at first sight, by a kind of intuitive proof or instant perception, and which nobody will ever think of disputing, much less of denying; I therefore premise them like axioms, on which I may safely proceed to build any doctrines or plans which really rest on these foundations, or come within their essential principles and reasons.—I go on now with my Review of the Principles and Arguments of the two foregoing Essays.

The great principles of the two foregoing Essays are comprised in the following propositions:

I. That all certificates delivered to the public creditors, ought to be placed to the debit of their account, at the value or exchange of them at the time they received them, and the remainder or residue of the debt due to them, ought to be paid to them with interest; and that all certificates, when brought into the treasury, ought to be paid to the bearer, whether an original holder or alienee, at the value or exchange, which each of them bore at the time of its date, or at the current exchange at the time of redemption, as the case may require. If this cannot be admitted, my second proposition is,

II. To pay all certificates brought in by the original holders, at full nominal value, with interest; and to pay all the alienated certificates at the value or exchange they bore at their dates, or at the time of redemption, as the case may require. If this cannot be admitted, I propose,

III. That the original holders be first paid, and the speculators, last of all, if they must be paid at all.

The great principle or substance of my argument is, that the public money ought to be paid to the real, original creditors, who, by rendering supplies and services to the country, have really, meritoriously, and painfully earned it: for,

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1. Their demand is founded on the most solemn contract of Congress, who had good right to make such contract, which binds the honor, the morality, and justice of the country, and nothing but payment can discharge the country from the guilt of injustice, and violation of faith and truth most solemnly plighted to them.

2. They fulfilled the whole of said solemn contract virtuously, honestly, and very painfully on their parts, and therefore, on every principle of merit and earning, are entitled to their pay.

3. The infinite benefits we derive from that contract and their faithful fulfilment of it, afford another argument why we should pay them: we cannot honestly enjoy the benefit of any man’s labor, without paying him his hire; it is to the supplies and services of these men, that we are indebted for our country, our lives, our estates, our liberty, and our independence, and all the blessings of a free government, uncontrolled and unbiassed by any foreign power or influence; and it ought not to be thought possible, that such an American government, which derives its existence from the exertions, the travails, and persevering virtue of these patriots, should, by a public act, deny them their pay, their hire, their reward, for merits which have been so beneficial to us, and painful to them; or should suffer any how the public money, carved out of the wealth and earnings of our citizens for the very purpose of paying these worthy patriots, to be diverted from this desirable object, or to be applied to any other purpose whatever.

4. The heart-moving and unparallelled distresses of very many thousands of these worthy patriots for want of their pay, is another cogent reason why they should be paid: I do not say, that the benefits we receive from their merits, or the distresses they suffer from our breach of faith and promise in denying them their pay, increase or alter the stipulations of their contract; but both have a strong effect on the gratitude, the benevolence, and compassion of the human mind, which are virtues of such precious and primary consideration in society, that, I think, no government ought to be callous to their influence, or hardened into an insensibility Edition: current; Page: [[349]] of their force. We all think it worse to refuse a laborer his hire, when he and his family must starve and perish for want of it, than to deny payment of an equal sum to a rich man, who had an equally just demand, but whose fortune would enable him to bear the loss without pain.

5. These original creditors have not yet been paid, but in small part, and therefore the remaining balance is still due to them, and ought to be paid. Nobody pretends they have ever received any payment but negotiable certificates made payable to the bearer, and worth on average, when they received them, about 2s. 6d. in the pound; these certificates, I say, ought to be debited to them at their value or current exchange when they received them; so much they have received, and no more; and the residue of balance due to them ought to be paid to them.

I have attended to all the debates on this great subject, both public and private, which have fell in my way, but I do not recollect one person who ever seriously insisted, that the certificates delivered to the public creditors were full payment of the debt due to them; but this notwithstanding, I have heard many objections, filly and nugatory enough, strongly urged against making any further payment to those who had sold their certificates.

1. One was, that if they had not fold their debt, they had sold the evidence of it, and so could have no further demand: this is not true; the evidence of the debt is the public books, where their accounts are adjusted, and the balance due to them is entered; and nothing can justly be objected to this but some evidence that the debt has been paid; which evidence, the certificate, if produced, could not supply. Further, the certificate, if produced, could not be so good evidence as the public books; for the one might be counterfeit, the other could not be: suppose a man brings suit on a record, of which he has some time or other taken a copy, and produces the record in court; can it be objected to his recovery, that he has not produced the copy? Or, if a man brings suit on a contract, and has three witnesses to it, two of which he produces, who fully verify the fact; shall he Edition: current; Page: [[350]] lose his cause, because he did not call in the third witness?

The public creditor who demands his pay, must doubtless bring evidence sufficient to support his suit, i. e. the proof will lie upon him, and if he can, in any way, verify the facts, and support his right, he doubtless ought to be paid.

2. Another objection has been made, viz. that all the original creditors who sold their certificates, were not driven by necessity to do this; and what if they were not? can there be any crime or disqualification in selling a negotiable certificate, made payable to the bearer, and purposely calculated, like bills of money, for negotiation and currency thro’ any and every hand?

3. It has been objected, that some original creditors sold their certificates thro’ diffidence of the public faith. And what if they did? Do you think they were singular in their diffidence? Suppose any man wants confidence in his debtor, and fears or doubts that he shall lose his debt; Can that affect the justice of his demand, or his right to payment?

4. Another objects to any further payment, because some of the creditors who sold their certificates for 2s. 6d. in the pound, had managed their 2s. 6d. so well by a seven years’ negotiation, as to make 20s. out of it.

5. Another objects, that many of the public creditors were of such a dissipating turn, that if they were paid the whole 20s. due to them, they would soon spend it, and, of course, would be no better but rather worse off, than if they had never been paid.

Now, gentlemen-readers, suppose any private debtor should be summoned into court, at the suit of his creditor, for a debt of 20s. and he should show that he had, seven years ago, paid his creditor 2s. 6d. of the debt of 20s. and plead any or all the foregoing objections against any further payment of the 17s. 6d. which remained due; can you imagine that the court would allow such plea to be good in law or equity, and sufficient to discharge the debtor from any further payment? And if these pleas and objections should Edition: current; Page: [[351]] appear trifling and ridiculous in a private concern, can you bring yourselves to believe they would receive any additional weight or dignity from being introduced by any most dignified personage, and urged in the most august assembly on earth, against paying public creditors circumstanced in the same manner.

But the great objection still remains, the clincher that is to support the whole plan, and so connect the parts together, as to make the whole consistent with law, reason, right, and justice; for certainly no plan can be justified, which has not all these qualities. This capital objection to paying the original creditors, who have sold their certificates, the balance of the debt, which has never been paid to them, is this, viz.

They have sold their certificates, and thereby conveyed to the purchaser all their right to their demand or debt due to them. As much stress is laid on this objection, it requires a particular consideration.

1. If the public promise or faith is supposed to be given in the certificate, it was broken the instant it was made; it was violated in the very birth of it; it was verbal only, not real; the words expressed the nominal value, but the reality or meaning sunk down instantly to the current value, by the very construction which Congress itself fixed, by their scale, on like words in the loan-office certificates, and under this construction they passed, by universal consent of buyer and seller, from hand to hand.

The wrong was instantly done to the original creditor, and he instantly sustained the injury and damage, and, consequently, if any thing is to be done in future time to compensate or repair that damage, it ought so to be done, that he who suffered the injury and damage, may receive the benefit of it; making this compensation to a stranger, who suffered nothing, is no repair of the wrong done, is no sort of restoration of injured right, and is, of course, nugatory and ridiculous.

2. But, in real truth, if the public saith was designed to be really plighted at all, it was annexed to the debt, not to the certificate; the debt was founded on the merits or Edition: current; Page: [[352]] valuable considerations out of which it grew, and to these it adheres, and carries with it the promise or public faith which is annexed to it.

The certificates and these merits are very widely different things; the one depreciated to 2s. 6d. in the pound; the other kept their value without the least diminution; the one was transferred; the other was not. The speculators can produce the certificates, but they cannot produce the merits, of the original creditors: these they never bought or paid for, and, therefore, can have no right or claim to them, or the rewards of them, i. e. to the debt annexed to them; for it is impossible that one man should have a right to the labor or hire of another, without paying a valuable consideration for it; if it was even agreed to be transferred without this, the transfer would be void as a nudum pactum, not only by the laws of the land, but by the immutable laws of commutative justice.

3. The certificate was never either delivered to, or received by, the original creditor, as full payment of the debt due to him, and therefore never comprised or carried in it that debt; nor is it pretended or pleaded by any body as any thing more than the evidence of that debt; and, of course, if the debt can be sufficiently proved by the public books, or any other evidence, the want or absence of the certificate can be no objection to the claim of the original creditor.

4. The certificate, when first delivered to the public creditor, being made payable to the bearer, and expressly fitted and calculated for circulation or exchange, like other bills of public credit, comprised and carried in it some value as long as it could be sold, but, like all other articles of negotiation or exchange, that value was liable to variation according to the rise or fall of the market.

From the two last propositions it clearly follows, that when the certificate was sold, all the value which it comprised or carried in it was sold and transferred with it, and no more; and of course, the purchaser, by the sale, became entitled to that value, and no more: the rest of the debt staid behind, and stuck fast to the original merits out of which it originally grew, and in the place where it always Edition: current; Page: [[353]] belonged, i. e. the original creditor, by the sale of his certificate, sold and granted all that he received, and no more; and that part which he had not received, he retained, and has a right to call for and receive, whenever he pleases.

5. A reference to the real design of Congress in issuing the certificates, especially at the close of the war, may cast some light on this affair. We are not to suppose that Congress issued negotiable certificates for 40,000,000 of dollars, worth but 2s. 6d. or some such trifle, in the pound, with real, serious design to load the nation with the immense burden of redeeming them at 20s. in the pound, wholly for the benefit of the bearers; by far the greatest part of whom, they had every reason to suppose, would be strangers not only to the merits, out of which the debt certified originally grew, but to any such services, or even kind wishes, for our country, as could deserve the public notice; and many of them strangers to the country itself.

We never ought to impute bad intentions, especially to public bodies of dignity, where their actions will equally well bear a favorable construction. I think, we are rather bound in charity to suppose, that, as Congress sound the public treasury so exhausted that it was impracticable to make even a small, partial payment to the public creditors, they might think that negotiable certificates would fell for something, which, tho’ little, might be better than nothing, and afford some relief, till the country could recover a little from the ruins of the war, and arrange the finances into some productive state, which would supply funds sufficient for full payment; and that, in the mean time, they might safely trust to the wisdom of a future Congress, to adopt modes of redemption of such certificates, either similar to their own scales then in established practice, or some other which might do justice to all, or at least something near it, and bring ruin on nobody, nor even disappoinment; for such a limited redemption was expected by every body at that time.

They had been long accustomed to issue public paper with the public faith plighted in words expressive and solemn enough, which yet, by their own scales and by general acceptation, were reduced, in construction or meaning, down Edition: current; Page: [[354]] to the current value or exchange which their paper obtained; and when they issued the certificates in question, I have no doubt but they considered themselves merely pursuing their long usage or practice, and conceived that the public paper they then issued, with all the rest that preceded it, would, in time, find and meet some reasonable mode of liquidation and final redemption, tolerable to all, and ruinous to none.

In this view of the matter, tho’ the means they adopted may not be deemed altogether proper (and perhaps, under the public pressures and necessities which then existed, no means could be hit on wholly free from exception) yet their intentions may be admitted to be just, salutary, and benevolent, and agreeable to the general expectation.

Whereas, on the other hand, to suppose them deliberately loading the States with a debt of 40,000,000 of dollars, for only 5,000,000 which they received and had the benefit of, is monstrous, which becomes still more hideous, if this horrible plan was designedly so formed that, by its natural operation, it would, in the end, cut all such of the original creditors who took benefit of it, off from 7-8ths of their pay or the debt certified to be due to them. But,

6. To suppose that the whole debt due to the original creditors is comprised in their certificates, and transferred by the sale of them to the purchasers, by the common rule of assignments, I say, this supposition will demonstrably prove either that the common rule of assignments is wrong and bad in itself, or wrongly applied to this case: but wrong in itself it is not; for it is plainly enough very good and useful in its place, i. e. within its due mean and reason; therefore, in the case in question, the application is wrongful, i. e. the rule will not admit a reasonable application to the facts, on which its operation is demanded.

For every law divine and human, every practicable rule of morality or sound policy, is and must most necessarily be founded on justice and right, and, in its application, must produce justice and right, and avoid injury and wrong; therefore, whenever any law or rule, however sacred in itself, is applied to any facts or case to which it so ill suits, that its necessary and unavoidable operation will be to destroy Edition: current; Page: [[355]] right and justice, and to produce wrong and injury, the application is certainly wrongful: in such case, the true use and meaning of the rule is mistaken or perverted.

All laws of every country are so capable of application to cases which are out of their reason, that a Court of Chancery makes a part of every judiciary system; the authority and duty of which is to control and soften the extreme rigor of the law; and when any stature or other rule is of so high authority that the powers of the court, do not extend far enough to give relief, application is and ought always to be made to the supreme authority, which is ever the supreme chancery of the State, to repeal such law, or explain and limit its true meaning, and correct the errors and wrongs of it.

Now to apply the foregoing position (which certainly no man will controvert) to the case before us—The opinion in dispute, ‘that the sale of a certificate transfers the whole debt certified, to the purchaser, by the common rule of assignments,cannot be true, because this would necessarily involve and imply great wrong and injustice, viz. it would take away the rewards due to the merits and earnings of our most meritorious citizens, and give the monies due to them to another class of people, who are not entitled to any of it by any kind of valuable considerations, merits, or earnings whatever, i. e. it would cut the original public creditors, who, by their merits and services, supported the war and saved their country, off from the rewards, the pay, the hire due to them, and give the same to the speculators, who never served or saved the country, and to whom we owe nothing.

This takes the public money to an immense amount, from a vast number of most deserving citizens, scattered thro’ every part of the Empire, who have dearly and most virtuously earned it, and have never been paid, and many of whom, with their families, for want of their pay, are now suffering the pangs of ruin and extreme distress, and all suffer great inconvenience and disappointment; I say, from these worthy, unhappy objects it takes the public money due to their earnings, and gives it to speculators, who have never earned any of it.

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These effects are unavoidable. Turn, and twist, and cook the matter into all shapes possible, and these effects will be found. They must and will exist, if that plan is carried into effect; the great injustice of which strikes every one with a force which the mind cannot resist. No man ever adopted that plan, but he found the gross, but unavoidable, final injustice of it a great difficulty, hard to be got over; and this final injustice proves as plainly that the plan which involves it, is wrong, as that any effect indicates the nature of its cause, or that that which does or works wrong, is wrong: of course, there is an error in the matter so very gross and important as to be fatal in society. Society cannot exist, if the laws of it will not secure to the laborer his hire, or to the vircuous the rewards of his virtue, or to the industrious the fruits of his industry.

In fine, the facts under that plan stand glaring thus: the original creditors claim their pay by solemn, public contract, by dear earnings, and most virtuous merits; they have not been paid; the money due to them is carved out of the labors of the nation, in order to pay them; they can get none of it, are finally cut off from it, and the speculators are to get it all, without the least claim of merit, services, or valuable consideration paid for it.

These facts must be either disproved or avoided (which cannot be; they are of the most public notoriety) or the absurdities and injuries resulting from them must be swallowed and digested (Good Heaven! what throats and stomachs men must have to do this!) or the plan must be given up.

Many people puzzle themselves to find where the error or wrong lies: some say, in the breach of the public faith; some say, in the original issuing the negotiable certificates; others say, in the folly of the seller, &c. &c. but I should think it very easy to see that the error lies in supposing that property can be transferred by implication, without any intention of the seller, and without any valuable consideration paid for it.

But it matters little where the error or wrong lies; it is quite enough to know that it really exists, and will produce Edition: current; Page: [[357]] its baneful effects, and is of such magnitude as to affect the essential interests of the nation, and will do so for ages to come; and, therefore, as soon as the error is discovered, it ought immediately to be corrected or remedied: the national safety, peace, and prosperity require this.

If we sow all over the nation errors and wrongs, they may be unnoticed at first, but will soon spring up and grow into a forest of chagrin and discontent, of wretchedness and ruin. Nothing can give peace and establishment to a nation, equal to ‘judgment and justice running down its streets, and righteousness overflowing it.’

It is not uncommon for men of lively genius and eager reasonings, and perhaps honesty too, to pursue their fine-spun arguments into conclusions that meet obstinate facts, which, like an impregnable wall, must and will stop their progress; but if their obstinacy happens to be equal to that of the wall, they will not be willing to turn about, or even stop, but will go on and beat and bruse their heads till their skulls are broken, and some crevice is opened, thro’ which their chimerical ideas can fly out; then, indeed, they will soften into calmness and moderation, and grow willing to hearken to some plan that is admissible by the hard facts which stand round them.

I heard once of a doctor who was called to a sick patient; he felt his pulse, soon thought he found his disorder, and prescribed a dose which killed him. When the doctor was told his patient was dead, he answered with some emotion, that he had no business to die; for he could demonstrate by the most approved rules of physic and medicine, that he ought not only to have lived, but to have got well by this time.

Now, if you please, we will seriously compare this plan in question with mine, which is comprised in my first proposition, viz. to debit the original creditors with the certificates they received, at the value or exchange they bore at the time of their dates, and to pay the residue of the balance due to them with interest, and to pay the certificates at the same value or their current exchange (as the case may require) to the bearers of them, whether original holders or Edition: current; Page: [[358]] alienees; and let us judge of the two plans by this most sure and unexceptionable criterion, viz. which of them will naturally operate by way of most justice and right, and least injury and wrong? for no practicable plan that can be adopted, every one will allow, will operate by way of perfect right and no wrong at all; no public plan that ever was adopted ever came or can come up to this degree of perfection, and all that is or can be in the power of human wisdom and weakness is to adopt that plan, which, in its operation, naturally produces most right and least wrong. By this criterion then we will judge of the two plans before us, which criterion is (all subtilties of reasoning aside) the only safe one which is practicable within the extent of human power.

1. The plan I oppose pays the immense sum of public money given by the nation purposely to reward the saviours of their country, pays this money, I say, to the speculators, who never earned any of it, who do not pretend to found their claim to it on any merits, or services, or valuable consideration, which they ever rendered to the nation or any body else, but demand the compensations and rewards due to the original creditors, without pretending to have paid any valuable consideration therefor to them; and at the same time, the plan denies those immense rewards to those worthy citizens, who found their claim thereto on the most sacred contract of Congress to them, under sanction of the public faith, which binds the countryby the laws of God and man;” on the most punctual fulfilment of said contract, on their part; and on their great virtue and merit, in saving their country in its most dreadful danger and distress: if any body thinks there is any honor, justice, or right in this plan, let him look for it, and I believe he will easily find all that is there.

2. The plan I propose is, to debit the original creditors with all the certificates they received, at their current value at the time of their dates, and pay the remaining balance due to them with interest; and to redeem the certificates by payment to the bearer, let him be either original holder or alienee, Edition: current; Page: [[359]] at the same rate, or at their current exchange at the time of redemption, as the case may require.

This plan pays the immense public monies to the people who earned them, i. e. to those who, by solemn, public contract, and by their real supplies and services rendered as the conditions of that contract on their part, are most justly and substantially entitled to them; and, at the same time, pays to the speculators the proper value of the certificates which they have purchased.

This plan, I think, will do the most general justice to the citizens at large, which can be done by imperfect human wisdom, in the present circumstances of the matter. This will place the public monies where they belong, will give every one his due, and no more than his due. This will bring, on one side, wrong and ruinous distress on nobody; nor will it, on the other, heap unmerited, unearned fortunes on any body. This will, in the end, do manifest justice and right to every one. This ought ever to be our goal, whatever confusion, doubt, and darkness may arise from the chaos of subtile arguments, dexterity of management, and artful disguising and twisting of facts, thro’ which we may be forced to make our way in our passage on to this realm of justice, truth, and light: for whatever dark and gloomy passages we may have occasion to pass thro’, in the deliberation and adjustment of human concerns and disputes, final justice and right ought ever to be the star that directs our steps, and which will certainly guide us to the rightful issue at last.

I cannot see that this plan will bear hard on more than two sorts or descriptions of men, viz.

1. Such public creditors who have real merits and just right to a claim, but, by some means, may not be able to prove their right; and probably, among the insinite number of real public creditors, there may be some of this sort, and perhaps many, who must suffer without remedy; for what cannot be proved, cannot be admitted in any court in the world; but then it is to be noted, that the plan I oppose leaves these sufferers as much unprovided for, and as much despevate and without remedy, as the plan I propose, and, of Edition: current; Page: [[360]] course, this objection lies with equal weight against both plans, if it is of any weight against either of them.

2. The second sort of men who may think my plan imposes hardship on them, are such speculators as have purchased their certificates at a higher exchange than that at which I propose to redeem them; but this loss or hardship (if it is any) is and always must be incident to such speculations, which, at best, are but games at hazard, altogether useless, barely tolerable, and often very hurtful to the public: I do not, therefore, conceive their loss or gain deserves any consideration in the public deliberations or decisions of this great question, viz. what rate or scale of redemption of certificates, Continental money, or any other public paper, does the general justice, and national honor, and safety of our country, require? But if we were to allow that the losses and hardships of these men were real and pitiful, they bear not the leaft proportion to the infinite hardship and ruinous distresses, to which the plan I oppose subjects countless thousands of our most deserving citizens; even if the calculation is made on either the numbers, amount of loss, or the merits, of the sufferers.

If this alternative cannot be avoided, it can admit no doubt but the lesser must yield to the greater; for it is certainly a less evil to incur the loss of a penny than a pound, or even to do injustice to one man than to a thousand; and of two evils we ought to choose the least.

But the morality of the two plans, i. e. the degree of justice and right, or of injury and wrong, which their operation will naturally produce, is not the only thing which ought to govern our choice of them; there is a most important difference both of facility of collection and utility of payment, under them. For,

I. Under the plan I propose, the public money paid will be scattered over the whole nation, thro’ every part where the real public creditors will be found; and the money so paid will,

1. Do an act of justice long due to the receiver:

2. Will increase the business of the country; as most of the creditors will be thereby enabled to go into or increase Edition: current; Page: [[361]] their business, who are now restrained and held back, thro’ want of their stock withheld from them by the public.

3. This money will immediately spread thro’ every part of the nation, and cause a great increase of circulation, which will give spirit and facility to the general industry and wealth of our people at large; and as the taxes are all ultimately paid by the consumers, who are spread over every part of the country,

4. The facility of collection of the second tax will grow out of the operation of the first, as the payments will be made more easy and satisfactory thereby; for the people will naturally grow contented under a tax, when they perceive advantages arising out of the increased circulation of cash produced by it, enough to compensate the burden of the tax.

II. But under the plan I oppose, the case will be greatly otherwise; for,

1. One third of the speculators are supposed to be foreigners, and, of course, their third of the money paid (say, 7 or 8,000,000 of dollars) will be sent directly out of the country, never to return again; this drain of cash by annual interest (for nobody thinks of paying the principal) when added to that of the foreign debt, is enough (if we had no other drains) to keep the country poor, distressed, and behind hand for ages to come.

2. The other two-thirds paid to the speculators here, will not be scattered over the country, and increase the general circulation, but will be accumulated in few hands, most of which, according to the common course of human passions, will be applied to make and support nurseries of vice, luxury, pride, vanity, dissipation, and bad example: for fortunes obtained by sudden acquirement, without any merits or earnings, are usually spent in this way; and if a few of them should happen to employ their money prudently, it will so far contribute to accumulating the national wealth into few hands, which is one of the worst things that can happen to a nation.

III. Another difference of the operation of the two plans will have great effect on the revenue. When the Edition: current; Page: [[362]] public money is paid for purposes of acknowledged justice, utility, and general advantage, the payment of taxes will be made without murmur, and the collection, of course, will be easy and without disturbance. Paying to the original creditors the hire of their labors, the debt due to them for exertions that saved their country, is a method of employing the public money of most acknowledged propriety thro’ the nation; but the payment of speculators is not so popular; it is hard for people to see the fruits of their labor taken from them, and given to speculators who never earned any of it.

This will naturally make the taxes odious; and, of course, the burden of the old taxes, the instituting of new ones, and the collection of both, will soon become objects of general uneasiness, murmur, and ill-humor; which, when general, will be easily blowed up into tumults, insurrections, and a general derangement of the peace and political order of society; smuggling and other avoidances of the taxes may not be the most alarming of these national frets.

In a nation thus tempered, a few men of spirit and enterprise, who may happen to be disgusted, soured with malevolence, and fired with thirst of revenge, may do infinite mischief.

Without the aid of any such incendiaries, I am persuaded beyond a doubt, that any tax to pay the speculators will sit very uneasy on the most quiet and peaceable citizens that can be found among us.

I was lately in conversation with a gentleman of great fortune, and noted for a very generous and peaceful temper, who told me he had just been paying an impost of about 30 dollars for wines he imported for his own use, and added, “had it been to pay our soldiers and other supporters of the war, I should not have begrudged it, had it been three times as much; but the thought that it must go to the idle speculators, makes my blood boil in my veins:”—and I conceive, every honest American that earns his own money, feels just so.

Taxes are ever ranked among the most techy articles of civil police, and require very delicate management; and our Edition: current; Page: [[363]] revenue-system is very young, tender, and not ripened enough into firm, general habit; and, tho’ in its infancy, it is pressed with a much heavier load than the country ever felt before; I therefore conclude, that any plan that tends to embroil the finances, and furnish objections and murmurs against the revenue, ought to be reprobated as the most dangerous and fatal measure that can be devised.

IV. There is another objection to the plan I oppose, which I consider very great, and which, I think, is obviated by the one I propose, viz. it encourages and supports idle and hurtful arts and contrivances to procure fortunes by dexterity and sleight of hand, rather than by the old, painful methods of industry, economy, and care. These speculators all have for their object, the acquirement of wealth without earning it, i. e. of getting the hire and rewards due to the labor and merits of another, into their own possession and enjoyment, without any retribution: this therefore is, in its nature and principle, wrongful; and people of this cast commonly spend their stock and time in these pursuits, which, otherwise, they would employ in useful occupations of husbandry, manufactures, or trade; and, of course, so much good stock and time is lost to the public.

I think, this sort of speculations ought not to be considered as merely useless, but hurtful also, and, therefore, ought by no means to be encouraged and supported by any measures of government; especially when their excess has been carried to such an enormous pitch, as to draw after it the ruinous consequences described above, and obvious to every discerning eye.

V. My next objection to the plan I oppose, arises from the general state of the finances of the nation, which I beg leave to introduce, with some previous observations by way of preface.

1. I am not alarmed at a heavy national debt; much less do I apprehend any destruction or ruin from it, if not too enormous; nor,

2. Am I under any doubt or diffidence of either the strength or patience of our people to bear it, if the following limitations and qualities of it are attended to:

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1st. If the debt contracted, or the public monies to be paid, are for necessary public purposes, i. e. to support and maintain the real justice, honor, safety, convenience, and well-being of the nation, e. g. to pay the civil list and just debts, for defence against enemies or pirates, for public roads, inland navigation, encouragement of genius, useful arts, &c. &c. &c.

2d. That the debt or annual demand for money does not exceed the product of an impost on imported luxuries, no higher than is necessary to reduce useless, luxurious, and hurtful consumptions down to that moderation that is necessasary for the health, morality, and wealth of our people; and,

3d. That the money collected by the tax shall be so paid out, that it may revert in its circulation to, and diffuse itself over, the same States and places out of which the money so collected was originally drawn, i. e. that the expenditures or payments of the money raised by the tax, shall be so made, that it shall revert to and circulate thro’ the same countries and places that paid it.

Under these limitations and restrictions, strictly and uniformly adhered to, no national debt can hurt, much less ruin, a nation; it would, in my opinion, operate like a sumptuary law, and would be rather an advantage and benefit on the whole, than a detriment. But this notwithstanding, I should choose to have the calculations made so, that the annual incomes might a little exceed the expenditures, that there might be a small surplus left to support accidents, or contingencies, or, as the country proverb is, that something might be laid up for a rainy day; but I would not wish to have such surplus very great, for if it was so, I should expect that most administrations would find plenty of contingencies, enough to consume it all—I will now go on to consider the present state of the public debt, as it is exhibited in estimates calculated up to the last of the year 1790.

The certificates of all sorts, now in circulation and to be provided for, amount, by the public estimates, principal, to 27,000,000 dollars; interest due last of the year 1790, to 13,000,000; whole amount, 40,000,000 dollars.

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By a moderate estimate, and much below what is generally supposed to be the real fac