The Pensacola journal. (Pensacola, Fla.) 1898-1985, 1918-08-15
WAR TAXATION
BIG Problem
T on AMERICA
Interesting Comparison Between
Present Day Cost and
the Revolution.
BILLS OF CREDIT
WERE RELIED ON
How Thirteen Colonies Prepared
to Strike Decisive Blow Is
Interesting History.

BY Associated Press.

VdSHfHetOus aug 14.-AG time
when Americans are thinking in war
terms OF billions OF dollars which must
be raised by domestic loans and taxa
tion it is interesting to examine the
methods employed to finance the first
American war--the War OF Independ-
ence
The total cost of the Revolution. not
including the expenditures of the indi-
vidual states, has been estimated at
about s80,000,000 a good deal less than
one days cost Of the present war Ths
sum is trMy Insignificant as compared
with the $4,000, 600 900 which will be
required to finance Americas share of
the present world war during the COM
ing year.
The thirteen colonies We're certainly
as unprepared to strike a decisive blow
for freedom as any county possibly
could be. and the people, handicapped
themselves at the very outset, by deny
ing to Congress the power of levying
and collecting taxes which would have
facilitated the raising of war revenue.
The colonists could not bring them
selves to the point of giving what they
considered too much power to a limited
group of men representing centralized
government, and while the Congress
could enact la8ir lation for an army and
navy, it could do no more than make
suggestions to the various states, re-
garding the manner in which these
lighting forces were to be maintained
AS a result, there was great amount
OF governmental confusion, and while
at least three systems OF raising reve-
nue. We're. suggested, there was no def
mite plan as to the way in which these
methods We're to be adjusted to one
another.
Greatest reliance was placed at first
upon the issue of bills OF credit: some
foreign loans We're negotiated; domes-
tic loans Were made and a nominal
sum was realized through taxes levied
by the states. The bills of credit, how
ever. rested uopn what proved to be
on unsound basis.
Within a week after the Battle of
Bunker Hill. authority was given for
an issue of s.. .0O0O 900 in credit bills. and
the amount to be redeemed between
f779 and 1882 was carefully apportioned
lowed, the total issue being about S24i-
among the colonies Other ISSUES fol-
552, ,7S0 but at no lime was that amount
in circulation and seldom was il ac-
ceptabe at face value. In i7Te depre-
citation became very marked and from
January to May of that year. the value
of the bills varied from twenty TO one
to thirty eight and a half to one.
The domestic loans were more sue
cessfu, although, with the exception
OF ons small loan for the purchase or
gun powder in June i775: these were
not Authorized until October i776, near
ly a rear and a half after the begin
ming u the Revolution. The failure of
the bills of credit and the paucity of
the revenue being secured through tax
alton led Congress to authorize the
borrtwing of 5000, 600 at the rate of
four per cent The lenders received
INDEBTED certificates which NAV right
fully be considered the forerunrers of
the Liberty Bonds. II was found ne
cessFy at a later period to raise the
interest rate to six per cent, put
throigh four loans the amount realfz-
ed vas only 50, ,7s7 600 In September.
i777i the American envoys secured the
first loan from France, and that re-
sultd in such a stimulation of the
domestic loans, that from that time
until the loan offices Were closed. ST.
6S4O0 in specie was subscribed
The foreign loans obtained by the
struggling colonies during their war
for independence are particularly in
tersting at the present time when the
United States is making such tremend-
ou loans to. the various allied coun-
tres. Through Benjamin Franklin
Giuverneur Morris and others. funds
wre obtained either in loans or sub
siies from the governments of France
AID Spain and from private bankers
ii Holland. France granted subsidies
d 1000, 900 livres in Hi and 6.OO0.OO0
lrres in 1851 In all, these sums.
Which may be regarded as gifts.
mounted to 81 ,996, 800
+ The United States borrowed from
france between TIT and 1888 the total
sum of SC. 352 500. while Holland loaned
The struggling nation 1905 900 and
Spain furnished si74is1la total of 81
s30,5i7. Nor must it be forgotten that
France spent at least 100000 on the
army which she sent to the aid of the
At the beginning of tsS4-ten years
after the declaration of Independence
the Indebtedness of the national GOV
arnment WAS s39. .323 ss6 This was III