Gazette of the United-States. (New-York [N.Y.]), 1790-02-27 00:00:00

Gazette of the United States.
PUBLISHED WEDNESDAYS AND SATURDAYS BY JOHN FENNO, No. 9, MAIDEN-LANE, NEW-YORK.
[No. XCII.]
SATURDAY, FEBRUARY 27, 1790.
PRICE THREE DOLLARS PR. ANN.
THE TABLET.
No. XCII.
"In an unsettled state of government, property frequently changes both its possessor and its value."
FROM the sketches contained in the two preceding essays, I hope the reader has been led into a train of reflections on the comparative situation of original and purchasing holders of public securities. I hope likewise that the result of a fair examination of the facts will convince an unbiaffed mind, that the different classes of creditors have sustained a proportion of the losses, more equal than has been usually represented. It must be observed, that a very considerable part of the real expence of the late war has fallen upon individuals in such a manner, as to exclude the possibility of an equitable mode of recompence. If an attempt were made to indemnify the sacrifices, and reward the services that have not yet been taken into view, in the settlement of claims, it would create such knavery and discord in society as to defeat every advantage we hope to derive from independence. In a revolution that originated in patriotic enthusiasm, and was conducted without system, it must be expected innumerable disorders will prevail, that admit of no remedy.
The advocates for discrimination, between the different classes of creditors, seem to suppose that the public securities are engrossed by a very few people. It has been mentioned that the greatest part of the public debt is in the possession of about one hundred persons. This surmise is without any foundation. There are, it may be presumed, not less than twenty thousand proprietors of our domestic debt. The outcry against speculators is raised without a knowledge of their character, or their numbers. Indeed there are some people under such a mistake, as to suppose that brokers are the only speculators, who hold large sums of the securities. This is so far from being the case, that a broker, strictly speaking, is no speculator at all. The profits of a broker accrue from the difference of prices, at which he daily buys and sells. Custom has established a difference at market, between what is called the buying and selling price. This affords the negotiator of paper, a commission that compensates for his time and attention. If he is a discerning industrious man, he may acquire by the extent of his business a large accumulation of gain. But he is still a different character from a speculator. The broker buys for other people; the speculator buys for himself. Both characteristics are sometimes blended in the same person. The real speculator however purchases an article to wait the event of the future market; and many persons who purchased securities at the close of the war, have held them through all vicissitudes, and determine to gain or lose by the final arrangements of government. Some of the most respectable characters in the United States are included in this description.
I now proceed to the object of this Essay, which is to enquire the causes that have generally induced original creditors to sell their certificates. The remark in my motto furnishes the best reply I can make to the question. All kinds of property fluctuated during the war, and soon after the close of it. Nothing preserved a stable value. Various motives excite people to speculate. A spirit of adventure is awakened. It can hardly be supposed that people had any special reasons for selling securities, more than for selling other property. Different men entertain different ideas respecting the future value of articles, and this induces one person to buy and another to sell. There is nothing more extraordinary in the negotiations of certificates either with respect to loss or gain, than has occurred relative to many descriptions of merchandise. I will not pretend but some persons may have been compelled by necessity to alienate their securities; but where one dollar has been sold from that cause, thousands have been sold from other causes.
The loan certificates could not, in many instances, have been disposed of, from necessity. Men who have money to loan, are not commonly poor men. The loans were, for the most part, voluntary; and therefore the lenders cannot make the plea of compulsion. When men could conveniently spare money, they lodged it in the loan office; and when it was more convenient for them to acquire money they sold their certificates.
It is said that the soldiers have been in indigent circumstances, and could not retain their securities till the present time. That some of them were necessitous I will not deny. But it should not be
conjectured that the bulk of the army left the service, in a worse condition, than they entered into it. In the late period of the war the troops were well fed and clothed. The army was composed mostly of young and middle-aged men, who were full of health and vigor, when they were discharged. They mingled among the citizens, and could easily find employment. In such a situation, it cannot be conceived that they were reduced to extreme indigence. The fact is, it does not comport with the character of a soldier to keep loose property in his hands. He has a liberal spirit, and distributes freely what he possesses. Circumspection in money matters is a rare qualification among men who feel a high degree of military ardor.
It has not been my intention to consider the question of discrimination on its general merit. I only had it in view, to convince the reader, that the relative situation of the different classes of creditors was not so strikingly different, as to furnish either with a claim on government, to interrupt the regular course of discharging the public engagements.
CONGRESS.
HOUSE OF REPRESENTATIVES.
TUESDAY, FEB. 16, 1790.
IN committee of the whole, the Report of the Secretary of the Treasury. Mr. Madison's motion for a discrimination still under consideration.
(Mr. White's Speech concluded.)
Mr. White then endeavored to obviate some of the objections to the measure, on account of its impracticability; and, in general terms, observed, that much greater pains had been taken to shew the impracticability than the injustice of it. He said, if it was just we ought to adopt it; and he did not doubt but the wisdom of the legislature would be able to carry it into effect. Purchasers, he said had been represented as the supporters of public credit; but he could not consider them in that light. He offered a tenth or an eighth part of the value of a bond of an individual, would tend rather to blast his credit, than to support it; and it would have the same effect with respect to the public.
He said he had lived long enough to be convinced, that wise and great men, having the same object in view, often differed in opinion with respect to the means of accomplishing it: therefore every proposition ought to be treated with candor and respect. He made the observation in consequence of what passed yesterday: a gentleman from Massachusetts had introduced his speech in a manner somewhat new—with an apology for an impropriety which he intended to commit; he pursued the arguments of the who went before him, in opposition to the amendment; but his speech consisted principally in an effusion of obnoxious epithets. Some of which Mr. White repeated, and said to detail the whole would perhaps fill half a column of a newspaper. He said he felt on the occasion, not for himself, for he had not expressed his sentiments on the subject under debate; but for the honor of the house, in which he thought no such language ought to be used.
It had been said we came forward as volunteers; that the original holders did not put in their claim. This might be easily accounted for: they were generally obscure and indigent; had too much modesty, or perhaps not the capacity, to come forward. That he believed the crowd in the gallery did not consist of original holders.
A gentleman from New-York (Mr. Benson) had objected to multifarious propositions. He was not certain that he understood the word; but had never considered it as applicable to two. That the proposed amendment had brought the business to such a state, that we had the choice of two systems. In order to determine which to adopt, it is necessary to examine the merits of both. That proposed by the Secretary of the Treasury he considered as exceptional; that the proposed reduction of interest was a breach of public faith; for although it was to be effected by the consent of the creditors, it would operate as coercion with respect to the original holders. He doubted not but the purchasers would eagerly embrace the proposal of 4 per cent. on the nominal sum: The original holders would not—they would wait for a more favorable determination; if they ever should consent it would be with reluctance, and because they find they should get nothing in any other way. The proposed disposition of the surplus revenue among the nonsubscribers, can have no effect: If government do not chuse to pay more than 4 per cent. interest, they will levy taxes only to that amount. The inducements to the acceptance of his several propositions, in consideration of the reduction of interest, are all futile. Western lands to the amount of one third! It is well known that western lands are not a property in much estimation among the holders of certificates.
With regard to his other propositions, of annuities and remote payments, it may be observed, that the proposed reduction is not founded on the inability of the States to pay, but on the principle of expediency only, left taxation should be extended to a degree and to objects which it might not at this time be proper to attempt. Now, what security have we that the same principles of expediency will nor operate ten years hence?
He observed, that the purchase of annuities had not been practiced in America, and did not think it would become an object as it was in Europe. That in Europe there were many single men, who carried their views no farther than their own lives, and who, as they advanced in years, became fearful of difficulty and distress in old age: But this seldom happened in America; there were few without families, and the care of procuring subsistence removed all apprehension of suffering in old age. Besides, a man in most parts of the country could realize his money in such a manner as to double its value in 15 years.
With regard to public opinion, he would say nothing, as he had no documents to support what he might advance. He might, however conjecture from the operation of the several systems.
If the amendment should be adopted, the taxes would be increased, but at the same time rendered more easy; as the means of payment would be in so many more hands. The people would see their indigent neighbors relieved, and those who had rendered services to their country in some degree rewarded.
But if the plan proposed by the Secretary should be adopted, the present holders of certificates, men without public merit, however respectable they may be in their private characters, will
be raised to an enviable state of wealth; the people, he presumed, will very ill brook the payment of taxes, when they see them applied to such purposes. Besides, we are told, that 5,000,000 dollars have been purchased in Holland; the interest of which will perhaps equal the whole expences of our civil government. Will the people approve of such a tribute, unless we can convince them of the justice of it? If it is just, if we have received value for it, no doubt but we must submit to the burden; however great it may be.
Mr. Hartley said that from the observations which have fallen from gentlemen on this occasion, he thought it his duty to give his opinion; tho' he acknowledged that the gentlemen who spoke yesterday had done better justice to the subject than he could.
He then entered into a consideration of the nature of contracts; and observed, the securities of the United States, are a fair and absolute contract; and placing the subject in a political and commercial view, he shewed that an interference on the part of government would be subversive of all those principles, on which every species of negotiable paper is founded.
He reprobated the attempting a discrimination: He said the nearest and dearest connexions he had in life would be benefited by the measure, but on general principles he must be opposed to the idea. If any compensation is to be made to the original holders who have alienated their securities, some other mode must be devised. Mr. Hartley concluded by some particular remarks on Mr. Jackson's observations.
Mr. Moore supported Mr. Madison's proposition. He entered into a particular discussion of the subject, among other observations he said, that if public opinion was to be fairly taken, nine out of ten would be found in favor of discrimination.
The soldiers, who after the war had parted with their certificates, were uninformed even of the resolves of Congress; and it was the interest of the speculator to keep them in the dark. They had followed the poor soldier, and attended at the spot where they could take the greatest advantage.
Mr. Moore concluded by expressing his approbation of the amendment, which he thought was founded on principles of justice and equity.
Mr. Wadsworth said that it appeared to him the question was totally misunderstood; the object appeared to be to benefit the army; and if this could be effected to any substantial purpose, I should be in favor of the attempt; but when I reflect that it would produce directly the contrary effects, I must entirely reprobate the plan.
There is nothing further from the truth than the assertion that the soldiers in general of the late army sold their securities through necessity. It is true that a great proportion of the army sold their securities, but they were of that description of men who never fail to divest themselves of all the property they get, immediately. He entered into consideration of the circumstances that led to the alienation of the securities: The exigencies of the country were such as made the necessity of speculation apparent to every body; and, that there was great credit due to those who in the darkest times of public affairs confided in the public faith, greatly to their own loss in innumerable instances: For it is a fact that the intermediate holders of public paper have suffered much more than the original holders. He expressed his disapprobation of the term so frequently repeated, "the poor soldier," as a fair and impartial statement of facts would shew, that the American soldiery had been better paid than any other army whatever; and much better than the officers: He made a statement of the actual amount received by the soldiers in bounties from the Continent, States and towns, which amounted, in the eastern States where the chief of the army had been raised, to 250 dollars pr. man upon an average from the state only. Mr. Wadsworth instance a great variety of difficulties which would arise to render impracticable the plan proposed. These were of a similar nature to those which Mr. Boynot and other gentlemen had stated.
Mr. Goodhue observed, that the gentleman from Virginia, who has advocated this discrimination, having acceded to the proposition, at a contract fairly understood between the contracting parties, and where a proper consideration was given, ought upon no terms whatever to be violated, it became the committee to try the question by its standard; and it sometimes happens, that we are so blinded by existing circumstances, that by reversing the scene in our minds, we are more likely to detect an erroneous sentiment than by any other argument. Let us suppose for a moment, that the late war had been prolonged to a degree, that the debt contracted in its prosecution, became so enormously large, that the abilities of the United States, would enable them to pay but five shillings in the pound, and a number of persons, who had purchased securities at ten shillings, should come forward, and pray they might be authorized to call on the original proprietors, to refund five shillings of the purchase money—can any body doubt what the answer would be? Would they not be told, from all quarters, that they purchased upon the contingency of the public ability? That it might have happened, that they would have got twenty shillings for what cost them but ten, it has turned out otherwise, they took the risk upon themselves, and therefore must abide the loss? This has been the understanding, which has universally prevailed, and every transaction of the United States, relative to assigned securities, as well as the security itself, in its very face, establishes such an understanding.
Mr. Goodhue further observed, that agreeably to his idea, public credit, became a desirable object chiefly for this reason, that in times when great exertions became necessary, the public might avail themselves of services and supplies, beyond what they may have money on hand sufficiently to command—this was to be done only by promissory obligations, and in order to have any effect and answer the purpose, they must be made assignable—he then asked, if the principle of a discrimination, contended for, had existed during the late war, or if it had been understood, any advantage was afterwards to be taken of an assigned security, which assignment was legalized in the very security itself, what would have been the consequences? Would it not have put a period to our credit and exertions? Would not such a principle now established, be an effectual bar to our future credit.
Mr. Goodhue acknowledged, that the case of many soldiers and others, who from necessity were obliged to part with the pledges of their public service for a small consideration, was peculiarly hard, and they were intitled to our compassion and generosity, but not at the expence of our national honor and solemn engagements.
The observation of Mr. Gerry, alluded to by Mr. Jackson, was not "ultima lex regum" or "ultima ratio regnum" as has been by mistake inserted, but "ultima ratio regum."
WEDNESDAY, FEB. 17.
Mr. Madison's motion under consideration.
Mr. Page said that he thought it proper to express some ideas to the committee upon the question, left it should be said that either a blind attachment to the mover on the one hand, or pusillanimity on the other influenced his vote—It has been said by some persons that the motion is infamous, by others it is supposed to be founded on strict justice, I hope a fair and temperate discussion will take place.—The enquiry is, whether we did not owe the

Officers and soldiers of the late army—and whether we have ever paid them. If we have not, is it not justice that they should be paid. This is bringing the matter to a point; and I cannot but agree with my colleague, that we are as a Court of Equity, from whom these people have a right to expect justice; and we may remember, that however we may decide, there is a Judge who will do justice.
The time is now arrived when justice should be done: This time has been patiently waited for; and I don't see how we can avoid doing full justice to the utmost of our power.
He then observed, that it appeared to him much greater injustice would be done in paying the speculators the full sum; it was more than they ever expected, for they had often expressed their doubts of government's ever paying off the securities. Upon the plan proposed, they will gain a profit in general, besides the interest of their money. It has been said, the securities are a contract between the holders and the government: This is strictly true as it respects the original holders. The measure it is said will operate as an ex post facto law: He had recurred, he said, to the Constitution, and found the clause had reference to Bills of Attainder: On this idea, government may not interfere in any case of fraud, for that unfair representations were used with the unsuspicious and needy soldier, cannot be doubted. He hoped that gentlemen would not be taxed with want of candor, for addressing their arguments to the heart as well as the head. When a case is doubtful, the heart is often the surest director. It is happy when they both concur in our decisions.
Mr. Boudinot: I consider the right determination of this question, as the key stone to the fabric of the public credit: As we lay this, will be the weakness or stability of the structure. He had thought differently, at different periods, on the present subject. He rejoiced that it had been brought forward, and hoped it would be discussed with candor and deliberation. He wished that the House should consider themselves as acting in the character of a National Legislature . If we lose sight, said he, of this idea, we shall do great injury to the subject, and every step we take we shall plunge ourselves into still further difficulties. He observed, that there appeared to be a coincidence in one particular sentiment, and that is, that the debt is just, honorable, and meritorious. It is also agreed that great part of this debt has been liquidated, and stipulated terms of payment given.
The incapacity of the United States was the only cause of that species of evidences of the debt's being given, which have from the same cause depreciated. [Here he read the Ordinance of Congress, empowering the original holders of certificates to transfer them; in which the transferees are considered as persons discovering "the most confidence" in the government.] He then observed that the proposition offered by the gentleman from Virginia, was brought forward in such manner, as to demand the most fair, candid, and decent investigation. [Here he read the several classes into which the creditors are divided by Mr. Madison.] With respect to the first class, those who have retained their securities, he agreed with the gentleman. In regard to the second, those who alienated, he said he could mention many persons in this predicament, as meritorious as any description of sufferers that can be named; but as the gentleman had not held them up, as objects of future indemnification, he should say nothing more respecting them. He then adverted to subsequent parts of Mr. Madison's speech, and observed, that gentlemen had used particular terms, in such manner, as to induce some confusion. He instanced Public Faith , Public Credit , and Public Justice , &c. With respect to the original creditors, he presumed that gentlemen would not contend that the persons, in whose names the securities are issued, are only to be considered as such; as it is demonstrable by incontestible facts, that far the greatest part of original holders' names do not appear in the certificates. He then defined the term Justice , and observed, that Public Justice is distributive justice; and is often a different thing from private justice; the latter may operate partially , the former always generally —and in this way equally. He pointed out the precise ideas on which the public paper was issued—that the contracts were formed upon the idea of the transferable quality of the payments to be made; the transferree is therefore ipso facto the original creditor. He then adverted to the doctrine of insurance, and from a variety of deductions, showed that the probable value of the securities had been paid in all the stages of negotiation. He quoted D'Avenant, and the Secretary of the Treasury, to show, that stock on interest, agreeable to all the rules of calculation, is always less valuable than cash. Sir William Davenant says, that a capital of 10s. is worth only 7s. cash. He reversed the present situation of the country, and placed the purchaser of the public paper in the circumstances it would probably have been in, had the country lost its independence—and asked whether a sufferer who had confided in the final success of the country, would conceive that the seller was bound to indemnify him for his loss? He further insisted on the existence of the contract—and in need the common and universal practice of merchants, and others, in all transferable and negotiable business—and from all inferred, and insisted that the assignee stands precisely in the shoes of the assignor. From this he adverted to the objection, arising from its being an ex post facto business—and as we are expressly precluded from passing any such law, the proposition involved a most palpable violation of the Constitution. The gentleman last speaking in reply to this objection, says, that on recurring to the Constitution he found that the clause referred only to bills of attainder .
Mr. Boudinot then read the clause, and remarked that he conceived the gentleman had given the clause but a cursory reading—the passage runs thus, "Congress shall pass no ex post facto law—or any bill of attainder"—He then pointed out the particular operation of the measure—as being retrospective to the fullest degree.
He combated the idea that Congress has a right to set as judges on this question—and insisted that this would prove such a violation of the constitution as must make every man shudder at the consequences.—Congress is not competent to determining questions of justice and equity between citizen and citizen—this is such a question—and our judicial courts are alone competent to determining the matter.—Mr. Boudinot dilated largely on this sentiment in this part of his speech—and represented the evil effects that would result, from Congress forming itself into a court of judicature.—He then entered into a consideration of the effects which such a measure would have on the public credit—he said in his opinion it would be a fatal stroke to its very existence—all public confidence would be destroyed—the public securities would immediately sink below any price they have ever been at.
He exhibited in striking colours the wretched predicament that all this property would be placed in; a situation that would totally frustrate all our hopes under the constitution.—He repeated the observation respecting the imbecility of the late confederation—and showed that tho' the individuals who composed that body were persons of the strictest honor and probity—yet in the public character which they held as legislators, judges and executors, they were constantly discovering by their decisions that personal property and private rights could not be protected in such an assembly—a full conviction of this, brought about a revolution in the government—with respect to public opinion—he observed that what was said in a private circle or by eighteen or 20 persons in a neighborhood, could not with any propriety be considered as the public opinion—there is in my opinion said he, a better mode of ascertaining it—and that is by turning to the acts and doings of the people in the several state assemblies—several of them have been recently in session, and in consequence of the idea being circulated that their respective debts would be assumed by the general government—they have voted to provide for the payment of the interest on their respective debts, without saying one word about discrimination, from whence it was fairly deducible that the public opinion is not in favor of the measure.
He enlarged on this article by saying, that no evidence of any kind whatever has been offered to the committee, to show that the
public opinion is in favor of this idea—on the other hand, the total silence observed on the part of the persons who are to be benefited, is a negative proof to the contrary—he replied to the reasons which had been assigned for this silence—and thought the dispersed state and poverty of the soldiers could not be considered as a sufficient reason.
He entered into a full consideration of the instance of the South Sea bubble, which had been adduced on this question—and laid that the circumstance did not apply, but on the other hand was directly opposed to the present proposition.—Mr. Boudinot here showed, that the interference of the government on this memorable occasion was altogether in favor of the public credit, and to oblige the company to make good their contracts.
He took notice of the Mississippi scheme—on this he said he could not dilate so fully—but from the issue of that business, as exemplified in the conduct of the commissioners employed on that occasion, who plundered the public of millions—he deduced the pernicious effects to be apprehended from appointing commissioners as must be the case, to settle the business on this plan.
Mr. Stone, after an introduction which we did not hear—observed, that the members appeared to differ exceedingly, in their opinions upon the most essential principles—on public justice said he we appear to differ very widely, the object therefore must be to produce as great a union of sentiment as possible.—He went into a consideration of the constituent parts of a contract—and insisted that their validity depended altogether on the equivalent—where no such equivalent can be adduced, contracts even in England, have never been enforced.—He applied this idea to the paper evidences of debt received by the officers and soldiers of the late army—no man will say that they have received an equivalent for their services—he supposed that no credit was due to the speculator for his confidence in the public faith—as to the risk—between buyer and seller, there was perhaps not more than one penny difference.
Mr. Stone observed, that if the speculator purchased a security of £100, for £10, on the idea or assurance of obtaining the full payment, he was guilty of a fraud—therefore as this is not supposed to be the case, the speculator will have full justice done him, by being paid his own money with interest, and it surely would be as much against the feelings of the speculator to receive 10 for 1 for his money as against those of the soldier to be reimbursed what he had been so long deprived of—the inability of the country to do full justice is not to be admitted—as he observed, that if there were purchasers to be found, the property of the United States would sell for 600 millions, and we have only 80 millions to provide for.—He enlarged upon the merits of the soldiers—and asserted that they had for years, suffered as persons who had been guilty of some crime—and this is the situation of men to whom America is indebted for her independence—if we do justice to these men we shall establish our character for humanity and we shall always be able to command the services of such persons; but if not, the defence of the country will devolve on mercenaries, who will be paid.
On the subject of discrimination, he laid it down as a principle that the country could not stand the shock of a governmental interference in altering the nature of the debt, by paying a less sum than the securities specified.—I would so contravene their habitual ideas on the subject that he was of opinion the most fatal consequences were to be apprehended, should the measure be attempted; still it is a proper subject of enquiry, to whom this amount is justly due—this appears to devolve upon the national Legislature as the only authority competent to doing justice.
(To be continued.)
WEDNESDAY, FEB. 24.
Sundry petitions were presented, read and laid on the table. The bill for regulating the Post-Office was read a second time, and referred to a committee of the whole House, to be taken up on Monday next.
Ordered that 100 copies be printed for the use of the House. On motion the memorial of Thomas Barclay was read the second time and referred to a select committee consisting of Mr. Clymer, Mr. Page, and Mr. Sinnickson.
Several other memorials were read and committed. In committee of the whole on the Report of the Secretary of the Treasury.—The assumption of the State debts under consideration. Mr. Stone, Mr. Sedgwick, Mr. Madison, Mr. White, Mr. Ames and Mr. Fitzsimons were the speakers. Mr. Madison proposed the following addition to the resolution, viz.
And at the same time, That effectual provision be made for the liquidation of, and crediting to the States, the whole of the expenses during the war, as the same has been, or may be stated for the purpose, and that the best evidence of the same be taken, the nature of the case will admit.
This proposition occasioned some conversation, but the committee rose without coming to a decision. The House then went into a committee of the whole, on the naturalization bill.
Mr. Baldwin moved that the clause which prohibits foreigners from holding lands in the United States, should be struck out; this occasioned some debate, which consumed the time, without producing a decision. Adjourned.
THURSDAY, FEB. 25.
Mr. Gilman of the committee of enrollment, reported, that they had examined the enrolled bill, providing for the enumeration of the inhabitants of the United States, and found it correct: He then presented it to the Speaker, who signed the same.
Mr. Boudinot of the committee appointed for the purpose, brought in a bill for securing to authors and proprietors, the copy right of Books, Charts, Plans, Maps, &c. which was read the first time.
Mr. Thatcher presented a petition from the weighers, gaugers and measurers of Portland, Massachusetts.
The petition of David Cook was read a second time, and referred to the Secretary at War.
Sundry memorials were read and committed. In committee of the whole on the report of the Secretary of the Treasury; Mr. Madison's amendment to the resolution for the assumption of the State debts under consideration.
Mr. Huntington said that he did not object to the tenor of the proposition: but thought the last clause, "That the best evidence shall be taken that the nature of the case will admit" would afford a dangerous latitude, as it might open the door to innumerable impositions, and would swell the public debt beyond all conception; if there were any peculiar cases, such as loss of vouchers by fire, devaluations by war, and other casualties, provision might be made by Congress for such cases: he hoped the words would be struck out.
Mr. White after a speech of considerable length, moved that the following should be added to Mr. Madison's proposition, viz. Provided such assumption shall not exceed the sum which any state may have advanced above its just proportion, as the same shall appear upon its liquidation; this produced a debate which lasted the remainder of the day—and an adjournment being called for, precluded any determination on the motion.
FRIDAY, FEB. 26.
The Report of the Secretary of the Treasury, on the petition of Francis Bailey, was read the second time.
Mr. Burke moved that it be referred to a select committee for the purpose of bringing in a bill to provide for the particular case of the petitioner.
Mr. Livermore objected to a special committee. He observed, that Mr. Bailey is one of the last persons that needed a special interference in his favor, as it is impossible, according to his own words, for any person to find out his invention. He is therefore perfectly secure from being injured by counterfeits.
Several gentlemen spoke in favor of the motion, and a select committee was accordingly appointed.
Mr. Gerry, to whom the memorial from the commissioners on
the public accounts, respecting the salaries of the clerks in their office was referred, reported, that the salaries of those clerks should be raised to 500 dollars pr. ann. any law of the United States to the contrary notwithstanding.
Sundry acts and resolutions of the legislature of the State of South-Carolina were communicated by Mr. Burke, and read, among others—
An act to cede to the United States the Light House, &c. In committee of the whole on the report of the Secretary of the Treasury; the assumption of the State debts under consideration. Mr. Madison's and Mr. White's amendments were read; the debate was resumed and continued by Mr. Stone, Mr. Burke, Mr. Clymer, Mr. Ames, Mr. Patridge, Mr. Fitzsimons, Mr. Sherman and Mr. White: and the question being taken on Mr. White's motion, it passed in the negative—32 to 15.
Mr. Madison's motion being again read—after a short introduction, he moved, that the following proviso should be added to it, viz. Provided that in case a final liquidation and adjustment of the whole of such expenditures, and provision for the payment of the ballances due from Debtor States to Creditor States, shall not be made before the _____ day of _____ the debts assumed shall be liquidated and adjusted, among the States, according to the ratio of representation, and effectual provision be henceforth made for paying the ballances to the Creditor States, at the expence of the Debtor States. This will be the next subject of discussion.
The committee rose and reported progress. The committee on the petition of Francis Bailey, brought in a bill which was read the first time.
In committee of the whole on the naturalization bill: Some progress was made in the discussion; but the committee rose without finishing the business, and the House adjourned to Monday next.
IMPORTANT EUROPEAN NEWS.
Received by the latest Arrival.
CALCUTTA, (East-Indies,) May 20, 1789.
By letters from Bombay we have been favored with a more particular account of the operations of Tippoo before Tellichery than has yet appeared.
On the 23d of March, Tippoo approached the neighbourhood of Tellichery with a force so considerable as to be seriously alarming. On the 26th, he encamped on Tandantenny, within light, and not more than four miles distant from the town. One of the seapoy belonging to the garrison, cutting wood on the banks of the stream which separates the districts of the English and Tippoo, was wantonly shot by a party of his troops. From the disposition of his army, and some threatening appearances, an attack was hourly expected; the inhabitants, to the number of two thousand, were, in consequence armed. Several deserters came in from Tippoo's army, and these he required to be delivered up in the most insolent and unbecoming terms. Very properly, his requests were treated with the utmost contempt. Among other deserters was a party of Frenchmen who belonged to Lally's corps; that these men should be delivered up, Tippoo was particularly anxious; however, to be out of danger, they were sent round to the government at Bombay on the Shah Syriah. On the evening of the 30th Tippoo, with his whole encampment marched off, avowedly for Pimplipatam, but as the vessel which brought this intelligence to Bombay left Tellichery the same night, it is uncertain where he has directed his rout.
The Government of Bombay have given protection to great numbers of Nairs to whom Tippoo has shewn a most implacable hatred, and on whom he has indiscriminately exercised the most studied cruelties; many of these poor wretches has he again and again, marched into wide and extensive plains; there ordered their legs and arms to be cut off in his own presence, and in that mutilated state left them laying on the ground, prohibiting under pain of death any relief being afforded to the miserable sufferers. During the march of Tippoo from Seringapatnam to Tellichery no less than five thousand have been sacrificed to the vindictive caprice of this unfeeling Tippoo.
MADRAS, May 10, 1789.
The letters from the southward, received yesterday and to day bring an account of an opposition to the detachment under the command of Col. Stewart, rather more obstinate than was expected at so early a stage; and of an action on the 14th instant, bravely maintained by the Murdoos, as they were called—Vellée Murdoo, in defence of the fort at Collungoody. The following are the particulars mentioned in an extract of a letter from the Camp at Collungoody.
"This morning at six o'clock we began the attack, and I am very sorry to add, it was desperate and bloody, beyond conception; it lasted until near one o'clock in the afternoon, when the principal village was taken; but it was stormed once or twice before this could be effected, and our people were repulsed with the loss of some men; the artillery could not get up to support them, or they must have carried it the first attack. Lieut. Taylor was shot through the thigh by a musket ball; Capt. Read slightly wounded in the leg; and, as near as I can guess, four or five of our grenadiers are killed, and twelve wounded, some of them mortally; many of the 72d are killed and wounded, but none of their officers. Mr. Freer is shot through the arm, and the bone dangerously shattered. Ensigns Macklerah, Ridge, and Cornack, are wounded, as is Lieut. Cuppage (slightly) in the hand. Several seapoy's killed and wounded; the Nabob, who is with us, is also wounded."

"A deserter from the Murdoos says, that China Murdoo has lost his son, and that another of the family is shot through the neck; a number of their people have been also killed and wounded. The artillery have had 15 men wounded, but no officer hurt. Some horses, and a quantity of grain, were found in the place."
CONSTANTINOPLE, Sept. 22.
WE learn that the Russian fleet has again taken possession of the island of Zea, after defeating the Algerine squadron, and that the commander of our fleet in the Archipelago has lost his head, by order of his Highness, for not opposing the ravages of the privateers there.
VIENNA, Nov. 19.
A courier has this moment arrived with the news that General Fabry has taken Cladova, and consequently the whole district of Krasnia, comprising 150 towns and villages. What renders this conquest of more importance is, that it will hasten the fall of Orsova, which receives most of its provisions from that quarter.
An officer from Prince Potemkin's army has brought intelligence of the surrender of Bender on the 15th instant, the garrison of which fortress, with as many of the inhabitants as were disposed to follow, were to be escorted to Ismail.
LONDON, Dec. 31
By the Austrian accounts, it is said, that the value of the stores taken from the Turks last campaign, amounts to twenty-two millions of florins. The vessels dispatched from England to America for wheat, may be expected to return in the middle of March; but should they be delayed even a month after that, which is very unlikely, their arrival then would destroy the combination, the effects of which must have at that time, and till the harvest, been severely felt, had not government wisely opened the ports.
Extract of a Letter from an English Gentleman at Brussels, Dec. 15.
"At half after three o'clock, while I was at dinner, the town bells rang the alarm, the patriots flew to arms, seized the critical moment, overpowered all the posts in the lower town, master the Mint, &c. This work was over by six o'clock, but the worse was yet to come; neither reason nor argument could prevail on the Patriots to desist from attacking the grand place opposite the Maison de Ville, which they hazarded against a whole battallion, furnished with eight pieces of cannon, and every avenue guarded. At half after nine the assault began, and continued with unremitting fury till half after 12 o'clock, when the troops called for a parley; but it was too late, they were all captured. Thus the Patriots got possession of all the lower town, and Dalton asked a suspension of arms for a few hours; it was granted, for rest was necessary to the Patriots. At nine o'clock on Saturday morning, to the surprise of every body, Dalton evacuated the town in the most precipitate manner, and the troops went out of the Portede Namur, rather pell mell than otherwise; and all this I saw, for I was about the whole time. He had 4500 effective men, and 18 pieces of brass cannon, besides howitzers. This famous hero was with the advanced guard, his hat flapped, and night-cap over his head, and by that time the rear of the army got out of the gate, he must have been three miles off. I am very sure there is not in history so disgraceful a retreat; for if Dalton had been possessed of skill, or courage, he might have demolished the town and Patriots together, which did not exceed 800 at the commencement; and who supplied the want of good arms and order by desperate courage. The whole country is now in the hands of the Patriots, and the Emperor may bid adieu to the Pays Bas. This Revolution is one of the most extraordinary in the annals of time; conducted with a regularity and humanity that does the natives great honor; not a Royalist has even suffered the smallest inconvenience, their houses are guarded with the utmost circumspection, and we are now perfectly quiet and tranquil."
No less than 120 vessels have already been despatched to America for corn.—From Liverpool 54—Bristol 33.—The coasts of Devonshire and Cornwall 33.—
Letters by yesterday's Flanders mails brings us the confirmation of the Austrians having evacuated Machlin and Termonde. In the former place, the patriots found a train of artillery, with 60000 stand of small arms, so that they are abundantly provided with warlike stores. On hearing of the taking of Brussels, the Imperialists left Louvain. Some letters mentioned positively that General Dalton is taken prisoner, with the whole body of troops with which he was endeavoring to retreat to Luxemburgh from Brussels. On his march, he took many of the nobles out of their country seats, and sent them hostages to Luxemburgh. However, the patriots have been even with him; for they have seized Count Cobenzel, Gen. Lelien, and the Prince Starenberg, who were just arrived from Vienna to mediate a pacification of the present troubles, and will keep them as counter hostages.
Government have in contemplation a colony for the Pelew islands.
At Constantinople such dreadful tumults are reported to prevail, as have obliged the Sultan Selim to abandon that city. Much blood has been shed on the occasion, and it is supposed the insurrection will end in the dethronement of the Emperor.
His Majesty's packet-boat the Sandwich, Capt. Dillon, which brought over the mail of Friday from New-York, has remittances to the merchants to the amount of upwards of 60,000l.—1000l. in Specie, and orders for great quantities of goods of all sorts.
The French Minister, it is said, has made a proposition to the Dutch to sell them the debt due them from the American Congress, for their service last war, which, it is said, has been accepted of. The Americans have given their consent to the transfer, by which means a very considerable sum of money will be raised at once for the service of the French King. Our Court had the first offer of purchasing the debt, but refused it.
NATIONAL ASSEMBLY.
PARIS, December 17.
The Assembly decreed, on the motion of the Military Committee, that all French troops, except militia and national guards, shall be levied by voluntary enlistment.
Carthusian appeared in the National Assembly to succeed M. de la Bastide as Deputy of Auvergn: It was the first, and will, in all probability, be the last time that such a monk honored a French Senate. He mounted the rostrum, and delivered a speech applauded by all the audience for its wisdom, patriotism, religion, and philosophy.
December 19.
This day, after a warm debate, the plan of Finance agreed on by M. Necker, the committee of ten, and the directors of the Caisse D'Escompte, was decreed by a great majority.
December 21.
The new division of the kingdom into departments, is in great forwardness; the committee of constitution having been materially assisted in their labors by the deputies from the several provinces.
Translation of a letter from General de Paoli, to the National Assembly.
"Mr. President: It is with transports of joy more easy to be imagined than expressed, that I entreat you to make known to the Assembly, over which you preside, the sentiment of my most profound respect, and most lively acknowledgement for the decree which you have passed in favor of my country and companions."
"In admitting Corsica to the perfect enjoyment of all the advantages which result from the happy constitution that you have established, you have at length found the most efficacious means of securing for ever the attachment and fidelity of its inhabitants: and in granting to my expatriated companions the power of returning and enjoying all the privileges of French subjects, while you manifest your justice and generosity, you attach to your new Constitution a number of individuals that will defend it to the last drop of their blood; and the beneficent Monarch, the restorer of the liberty of his people, who has sanctioned these decrees, will have no subjects more devoted to his glory."
"Permit me the honor to say, that I am, with the most profound respect, yours, &c."
DE PAOLI."
London, Dec. 11, 1789.
FOR THE GAZETTE OF THE UNITED STATES.
LETTER.—No. III.
MR. FENNO,
BEFORE we can form a clear idea upon matters, we must first acquaint ourselves with the name, the nature and circumstances of the thing. Thus I was compelled to travel over large philosophical and historical grounds, to find the place of the wool hairy negro in the order of nature. Animated beings, therein considered, in strength of body, or in their intellectual strength, in either the one, or the other case, the weakest is ruled by the strongest. As plainly as I conceive, that the ox is born to plough my ground, as plainly also the philosopher will see, that nature has designated the wool hairy negro by innate inferiorities, in consequence of which, he is the slave of other nations. But when nations have attained a high degree of cultivation, and population, they feel the impropriety to have slaves, and if not compelled by circumstances, they will suffer none; this leads me to consider slaves, on political ground.
Where slaves are numerous, plots, insurrections, and war will be the consequence; for examples of these, the history of the slaves in Sparta, in ancient Rome, in Surinam, in the West-India islands, furnish sufficient proof. Slaves are a contradiction to the laws of a free government, and to those of a well regulated monarchy; this is exemplified by the proceedings of the English and French; these were for a while uniform, any negro was free the moment he stood on French or English ground; but the consequences arising from the acquisition of this new species of citizens were soon perceived; the English to get rid of the evil, try now to colonize them in Africa, and the French have without ceremony sent them to the sugar islands; probably they were sold for the Kings account, what I know by experience gives ground for this opinion; in the year 1786, one of my negroes, a girl of about eleven years, a pet of my wife's, was in consequence of that law in France, taken up by the police in port l'Orient, and sent to the islands to be sold for the Kings benefit. The reason of these proceedings in both nations is, that when prompted by humanity to make out of wool hairy negroes citizens of the realm, they did not consider, that they had given up their power to prevent the intermarriage of the black citizens with their white women, &c. &c.—thus to mend what inconsiderately had been done, the English put themselves to trouble, and expence to colonize them, and the French, notwithstanding their urbanity, did a manifest piece of injustice.
In ancient times, the Portuguese and Spaniards, were as white as other Europeans, but they were conquered by Carthaginians, Mauritanians, and other African, swarthy, and black people; the intermarriage was enforced by conquest, hence the dark colour prevails among the two nations; their minds have not however been debased by the intermixture, because, the conquerors were highspirited, long haired tawny and blacks.
RUSTICUS.
FROM THE VIRGINIA INDEPENDENT CHRONICLE.
ODE,
For the BIRTH DAY of THE PRESIDENT.
By the Rev. THOMAS THORNTON.
HAIL to the sun, whose circling ray, Once more revolves the happy day That gave our HERO birth; Prepare the feast, in pairs advance, To raise the song, or lead the dance. To jollity and mirth.
CHORUS,
Blow the trumpet, found the flute, Tune the viol, strike the lute, And let ev'ry free-born soul Chant his name from Pole to Pole.
Ambition fir'd the chiefs of old, To fight for empire, or for gold, How few for liberty: But he was born, by Heav'n design'd, To scourge th' oppressors of mankind, And set th' oppress'd free.
Cæsar and Philip's frantic son, With arms and chains, the world o'er run, To gratify their pride: Benevolence and valor join'd, Display the greatness of his mind, And all his actions guide.
NASSAU forsook his native land, Great Britain's ruin to withstand, And he the nation sav'd: Great MARLBRO' led her conquering force, Where nothing could retard his course, And ev'ry danger brav'd.
WILLIAM's high deeds a crown obtain'd, A Prince's title MARLBRO' gain'd; But greater is HIS claim, Thirteen United People's prayers, Their Soldier's hearts, their Senate's cares, Are offer'd all for HIM.
Propitious victory has spread A grove of laurels round his head, And Peace his conquest crown'd: May no malignant spirit dare, With baneful breath, God grant my prayer, His Fame or Peace to wound.
But may kind Angels near him wait, To bear him late, O very late, From hence to realms above; And may he be permitted there, As with his arm he freed us here, To speed us with his love.
CHORUS.
Blow the Trumpet, &c. &c.
RECITATIVE.
Had I my favorite PRIOR's happy vein, I'd sing his triumphs in a noble strain; NASSAU or MARLBRO' shou'd not brighter shine, In bolder figures, or a smoother line; Ensigns and Trophies shou'd adorn his bowers, And Vernon's Mount rise high as Blenheim's towers.
CHORUS.
Blow the Trumpet, &c. &c.
FOR THE GAZETTE OF THE UNITED STATES.
MR. FENNO,
Being in the gallery this day, the rapidity of certain movements, gave rise to the following, which please to publish, and oblige, S. FEB. 26.
THE TYPE-NOSTRUM.
THE maxim's held by all mankind, That Quacks in ev'ry trade we find; And yet how few are on their guard— Pretenders seldom miss reward: E'en Senates—form'd of learned sages— Have been be-quack'd, in former ages. All hail ye labor-hating crew, Who keeping novelty in view, Mankind bewilder and surprize, See with your's—not their own eyes. Ye 'spight of nostrum, pill and powder, The bell of death was never louder.
But astrum, hid in broken steel, To bene the common weal— May justly make a stoic feel. Yet B— is no mortal snout, Can scent this wondrous secret out— And ev'n C— seem to think, That he can make such strokes in ink, As shall defy all future cheats, T' enrich themselves by counterfeits. Hence patents "ready and dry"— Confirm the maxim in my eye; While B—'s meer chance med stroke, Prove wit and genius all a joke.
NEW-YORK, FEBRUARY 27.
A CORRESPONDENT.
The assumption of the State debts appears to be attended with many difficulties, in the contemplation, but while it is very well known that ingenious men can very easily perplex and embarrass any business when under discussion—and although it is conceded that the present subject is attended with circumstances that require consideration; it is without doubt a measure that involves the justice, peace and stability of the government—and it is conceived that the great and desirable event of a settlement of accounts between the individual states and the United States, can be brought about in no other way.
One great advantage gained by the people of the United States in the late revolution, is the almost total abolition of dry taxes; for it is notorious that the laws for direct taxation operated most unequally, as the poor were the victims, while the wealthy could very easily evade paying any thing like their proportion: But in imposts, and especially excises, there is not such opportunities to evade; as the consumers must inevitably pay in proportion to the consumption. In this view, every person becomes interested in the punctual execution of the laws, for smuggling and evasions cause deficiencies, which take money out of the pockets of the poor.
THE PRESIDENT of the UNITED STATES, now resides in Broad-Way, in the house, that was lately improved by the Hon. Chargé de Affaires of his Most Christian Majesty, who has removed to Cherry-Street.
"AFRICANUS" in our next.
Wanted by the Editor of this paper, a House that will accommodate a large family, and the printing business—from the first of May next.
ARRIVALS.—NEW-YORK.
Friday. Ship Peacock, Pearson, St. Kitts, 18 days. Ship Alexander, Woodard, St. Ubes. Brig Federalist, Marsh, St. Thomas.

REPORT of the SECRETARY of the TREASURY to the HOUSE of REPRESENTATIVES.
TREASURY DEPARTMENT, Jan. 9, 1790.
[CONTINUATION.]
THE Secretary conceiving, that he could not convey an accurate idea of the plan contemplated by him, for the collection of these duties in any mode so effectual as by the draft of a bill for the purpose, begs leave respectfully to refer the House to that, which will be found annexed to this report, relatively to the article of distilled spirits; and which, for the better explanation of some of its parts, is accompanied with marginal remarks.
It would be the intention of the Secretary, that the duty on wines should be collected upon precisely the same plan with that on imported spirits.
But with regard to teas and coffee, the Secretary is inclined to think, that it will be expedient, till experience shall evince the propriety of going further, to exclude the ordinary right of the officers to visit and inspect the places in which those articles may be kept. The other precautions, without this, will afford, though not complete, considerable security.
It will not escape the observation of the House, that the Secretary, in the plan submitted, has taken the most scrupulous care, that those citizens upon whom it is immediately to operate, be secured from every species of injury by the misconduct of the officers to be employed. There are not only strong guards against their being guilty of abuses of authority; they are not only punishable, criminally, for any they may commit, and made answerable in damages, to individuals, for whatever prejudice they may sustain by their acts or neglects: But even where seizures are made with probable cause, if there be an acquittal of the article seized, a compensation to the proprietors for the injury their property may suffer, and even for its detention, is to be made out of the public treasury.
So solicitous indeed has the Secretary been, to obviate every appearance of hardship, that he has even included a compensation to the dealers, for their agency in aid of the revenue.
With all these precautions to manifest a spirit of moderation and justice on the part of the government: And when it is considered, that the object of the proposed system is the firm establishment of public credit; that on this depends the character, security and prosperity of the nation; that advantages in every light important, may be expected to result from it; that the immediate operation of it will be upon an enlightened class of citizens, zealously devoted to good government, and to a liberal and enlarged policy, and that it is peculiarly the interest of the virtuous part of them to co-operate in whatever will restrain the spirit of illicit traffic; there will be perceived to exist, the justest ground of confidence, that the plan, if eligible in itself, will experience the cheerful and prompt acquiescence of the community.
The Secretary computes the nett product of the duties proposed in this report at about one million seven hundred and three thousand four hundred dollars, according to the estimate in the schedule K, which if near the truth, will, together with the probable product of the duties on imports and tonnage, complete the sum required. But it will readily occur, that in so unexplored a field there must be a considerable degree of uncertainty in the data. And that, on this account, it will be prudent to have an auxiliary resource for the first year, in which the interest will become payable, that there may be no possibility of disappointment to the public creditors, ere there may be an opportunity of providing for any deficiency, which the experiment may discover. This will accordingly be attended to.
The proper appropriation of the funds provided, and to be provided, seems next to offer itself to consideration.
On this head, the Secretary would propose, that the duties on distilled spirits, should be applied in the first instance, to the payment of the interest of the foreign debt.
That reserving out of the residue of those duties an annual sum of six hundred thousand dollars, for the current service of the United States; the surplus, together with the product of the other duties, be applied to the payment of the interest on the new loan, by an appropriation, co-extensive with the duration of the debt.
And that if any part of the debt should remain unsubscribed, the excess of the revenue be divided among the creditors of the unsubscribed part, by a temporary disposition: with a limitation, however, to four per cent.
It will hardly have been unnoticed, that the Secretary has been thus far silent on the subject of the post-office. The reason is, that he has had in view the application of the revenue arising from the source, to the purposes of a sinking fund. The post-master-general gives it as his opinion, that the immediate product of it, upon a proper arrangement, would probably be, not less than one hundred thousand dollars. And from its nature, with good management, it must be a growing, and will be likely to become a considerable fund. The post-master-general is now engaged in preparing a plan, which will be the foundation of a proposition for a new arrangement of the establishment. This, and some other points relative to the subject referred to the Secretary, he begs leave to reserve for a future report.
Persuaded as the Secretary is, that the proper funding of the present debt, will render it a national blessing. Yet he is so far from acceding to the position, in the latitude in which it is sometimes laid down, that "public debts are public benefits," a position inviting to prodigality, and liable to dangerous abuse—that he ardently wishes to see it incorporated, as a fundamental maxim, in the system of public credit of the United States, that the creation of debt should always be accompanied with the means of extinguishment. This he regards as the true secret for rendering public credit immortal. Any, he presumes, that it is difficult to conceive a situation, in which there may not be an adherence to the maxim. At least he feels an unfeigned solicitude, that this may be attempted by the United States, and that they may commence their measure for the establishment of credit, with the observance of it.
Under this impression, the Secretary proposes, that the nett product of the post-office, to a sum not exceeding one million of dollars, be vested in commissioners, to consist of the Vice-President of the United States or President of the Senate, the Speaker of the House of Representatives, the Chief Justice, Secretary of the Treasury and Attorney-General of the United States, for the time being, in trust, to be applied, by them, or any three of them, to the discharge of the existing public debt, either by purchases of stock in the market, or by payments on account of the principal, as shall appear to them most advisable, in conformity to the public engagements; to continue so vested, until the whole of the debt shall be discharged.
As an additional expedient for effecting a reduction of the debt, and for other purposes which will be mentioned, the Secretary would further propose that the same commissioners be authorised, with the approbation of the President of the United States, to borrow, on their credit, a sum, not exceeding twelve millions of dollars, to be applied,
First. To the payment of the interest and instalments of the foreign debt, to the end of the present year, which will require 3491,923 dollars, and 46 cents.
Secondly. To the payment of any deficiency which may happen in the product of the funds provided for paying the interest of the domestic debt.
Thirdly. To the effecting a change in the form of such part of the foreign debt, as bears an interest of five per cent. It is conceived, that, for this purpose, a new loan, at a lower interest, may be combined with other expedients. The remainder of this part of the debt, after paying the instalments, which will accrue in the course of 1790, will be 3,888,888 dollars, and 81 cents.
Fourthly. To the purchase of the public debt at the price it shall bear in the market, while it continues below its true value. This measure, which would be, in the opinion of the Secretary, highly dishonorable to the government, if it were to precede a
provision for funding the debt, would become altogether unexceptionable, after that had been made. Its effect would be in favor of the public creditors, as it would tend to raise the value of the stock. And all the difference, between its true value, and the actual price, would be so much clear gain to the public. The payment of foreign interest on the capital to be borrowed for this purpose, should that be a necessary consequence, would not, in the judgment of the Secretary, be a good objection to the measure. The saving by the operation would be itself, a sufficient indemnity; and the employment of that capital, in a country situated like this, would much more than compensate for it. Besides, if the government does not undertake this operation, the same inconvenience, which the objection in question supposes, would happen in another way, with a circumstance of aggravation. As long, at least, as the debt shall continue below its proper value, it will be an object of speculation to foreigners, who will not only receive the interest, upon what they purchase, and remit it abroad, as in the case of the loan, but will reap the additional profit of the difference in value. By the government's entering into a competition with them, it will not only reap a part of this profit itself, but will contract the extent, and lessen the extra profit of foreign purchases. That competition will accelerate the rise of stock; and whatever greater rate this obliges foreigners to pay, for what they purchase, is so much clear saving to the nation. In the opinion of the Secretary, and contrary to an idea which is not without partisans, it ought to be the policy of the government, to raise the value of stock to its true standard as fast as possible. When it arrives to that point, foreign speculations (which, till then, must be deemed pernicious, further than as they serve to bring it to that point) will become beneficial. Their money laid out in this country, upon our agriculture, commerce and manufactures, will produce much more to us, than the income they will receive from it.
The Secretary contemplates the application of this money through the medium of a national bank, for which, with the permission of the House, he will submit a plan in the course of the session.
The Secretary now proceeds, in the last place, to offer to the consideration of the House, his ideas, of the steps, which ought at the present session, to be taken, towards the assumption of the state debts.
These are briefly, that concurrent resolutions of the two Houses, with the approbation of the President, be entered into, declaring in substance,
That the United States do assume, and will in the first session in the year 1791, provide, on the same terms with the present debt of the United States, for all such part of the debts of the respective states, or any of them, as shall, prior to the first day of January in the said year 1791, be subscribed towards a loan to the United States, upon the principles of either of the plans, which shall have been adopted by them, for obtaining a re-loan of their present debt.
Provided that the provision to be made as aforesaid, shall be suspended, with respect to the debt of any state, which may have exchanged the securities of the United States for others issued by itself, until the whole of the said securities shall, either be re-exchanged, or surrendered to the United States.
And provided also, that the interest upon the debt assumed, be computed to the end of the year 1791; and that the interest to be paid by the United States commence on the first day of January, 1791.
That the amount of the debt of each state so assumed and provided for, be charged to such state in account with the United States, upon the same principles, upon which it shall be lent to the United States.
That subscriptions be opened for receiving loans of the said debts at the same times and places, and under the like regulations, as shall have been prescribed in relation to the debt of the United States.
The Secretary has now completed the objects, which he proposed to himself, to comprise in the present report. He has, for the most part, omitted details, as well to avoid fatiguing the attention of the House, as because more time would have been desirable to digest the general principles of the plan. If these should be found right, the particular modifications will readily suggest themselves in the progress of the work.
The Secretary, in the views which have directed his pursuit of the subject, has been influenced, in the first place, by the consideration, that his duty from the very terms of the resolution of the House, obliged him to propose what appeared to him an adequate provision for the support of the public credit, adapted at the same time to the real circumstances of the United States; and in the next, by the reflection, that measures which will not bear the test of future unbiased examination, can neither be productive of individual reputation, nor (which is of much greater consequence) public honor, or advantage.
Deeply impressed, as the Secretary is, with a full and deliberate conviction, that the establishment of public credit, upon the basis of a satisfactory provision, for the public debt, is, under the present circumstances of this country, the true desideratum towards relief from individual and national embarrassments; that without it, these embarrassments will be likely to persist still more severely upon the community—He cannot but indulge an anxious wish, that an effectual plan for that purpose may, during the present session, be the result of the united wisdom of the legislature.
He is fully convinced, that it is of the greatest importance, that no further delay should attend the making of the requisite provision; not only, because it will give a better impression of the good faith of the country, and will bring earlier relief to the creditors; both which circumstances are of great moment to public credit; but, because the advantages to the community, from raising stock, as speedily as possible, to its natural value, will be incomparably greater, than any that can result from its continuance below that standard. No profit, which could be derived from purchases in the market, on account of the government, to any practicable extent, would be an equivalent for the loss, which would be sustained by the purchases of foreigners, at a low value. Not to repeat, that governmental purchases, to be honorable, ought to be preceded by a provision. Delay, by disseminating doubt, would sink the price of stock; and as the temptation to foreign speculations, from the lowness of the price, would be too great to be neglected, millions would probably be lost to the United States.
All which is humbly submitted.
ALEXANDER HAMILTON, Secretary of the Treasury.
FOR THE GAZETTE OF THE UNITED STATES.
MR. FENNO,
THE management of the public debt in an honest and suitable manner is a subject on which much of our character, as a nation, depends. The government under the confederation entered into solemn stipulations with those who loaned them monies—served them in the field—supplied them with provisions, &c.—And the former Congresses shewed a disposition on all occasions to make good those sacred engagements, but had not the power to draw forth the resources of the country.
The good people of these States finding that the powers vested in Congress by the former articles of confederation were very inadequate to those things which were indispensably requisite to good government, have established a New Constitution. The scene is now changed, and we be-
hold with pleasure a system of government, adequate to all the purposes of the nation. Justice is expected to flow in pure streams from this fountain, and that all the purposes expressed in the preamble to the Constitution will be fully answered. Now may the citizens of the United States contemplate with pleasure a government, chaste and pure—but any departure from public promises would give a wound to the system, which time itself cannot cure.
By one of the articles in this New System "all debts contracted and engagements entered into before the adoption of this Constitution, shall be as valid against the United States under this Constitution, as under the confederation." Now may the public creditors, who have so long waited for payment, and who have exhibited examples of patience unknown in any other country, expect that the promises made them by the former government will be fulfilled. No doctrine of expediency can be admitted for any the least departure from the public engagements—these promises must be considered as obligatory as those which the people are under to support the government.
But it is said by some persons that the government must now be cautious what promises they make, for a punctual fulfillment of their engagements will be expected—and any departure therefrom would be attended with fatal consequences to the nation. To this I would say the greatest caution is necessary in making the promises, and an exact fulfillment will, and ought to be expected; but let me ask, is not the present government as sacredly bound to fulfill the engagements made by the United States under the old confederation, as the members who may compose the government in 1796 will be to fulfil the engagements which may be made the present year—most certainly they are—and if past promises may be departed from, who will be surety for the future.
But it is said revenue cannot be found to discharge the expence of government, and pay so great interest on their debts (as they have promised) without too much burthening the people. Suppose this to be the case at this time, are we not rising in importance, daily increasing in numbers—and is it not highly probable that monied men will emigrate to our country, when they find that their property will be safe here—that the public faith is sacredly kept—and that no deviation from public promises has taken place since the people established a government adequate to all the purposes of the Union.
It has been frequently said that the Report of the Secretary of the Treasury discovers great abilities—in this sentiment I most readily join—and add, that I have the highest opinion of his integrity—his determination to do honor to his country—and justice to her creditors; but at the same time I do not wholly approve of his plan respecting the public debts, because I think it a departure from the promise of six pr. cent. and that the proposed loan must be considered, in a certain degree as compulsory.
The Secretary proposes four pr. cent. interest, and this is equal to six pr. cent. on two thirds of the debt. Let it now be proposed that two thirds of the debt, in the hands of each individual, be funded at six pr. cent. and for the other third that he receive a certificate, purporting that the United States are indebted in such sum, which they promise to pay, with interest, at six pr. cent. and that in the first session in the year 1795, they will provide funds for paying the annual interest, at the rate of six pr. cent. on such of those certificates as may be then unredeemed. Let the revenue from the Post Office, and the lands of the United States, be considered as a sinking fund, and employed in such manner as may be thought best, in purchasing the evidences of the debts of the Union—and let all the debt, whether funded or unfunded, be redeemable at the pleasure of the government. By this means may the National Faith be preserved inviolate—public creditors be satisfied when they see government doing all in its power to make good former engagements—and it is probable that the day may not be very distant, when the National Credit being firmly established, government may propose to her creditors to reduce their interest to four pr. cent. or borrow money at that rate of interest, and pay off the principal to those who may not wish to reduce the interest: In such case, and only such can government propose a reduction of interest with propriety, and without a violation of public faith.
A LIVERY STABLE,
Kept by BENJAMIN POWELL, at the upper end of QUEEN-STREET, No. 111, near the TEA-WATER PUMP.
WHERE he takes in Horses by the night, week, month or year, at the most moderate rates that can be afforded. He thanks his former customers for their favors, and flatters himself that care and attention will again be paid to such gentlemen, as may put their horses in his charge. Boarding and Lodging may be had by applying as above. FEB. 25.
To be LET,
And possession given the 1st of April, for one or more years, (two miles and half from this city, on the Greenwich road.)
THAT NEW TWO STORY HOUSE—four Rooms on a floor; with six fire places; a new Barn, and Well of excellent Water; a young Orchard of Fruit Trees, with 7 1/2 acres of Land, the most part Meadow. For particulars enquire at No. 7, Maiden-Lane. New-York, February 26.