El Paso herald. (El Paso, Tex.) 1901-1931, 1918-08-14
j. 8. TAXATION
SYSTEMATIZED
War Revenue Is Not OBJ
tanned in the Haphazard
Way of Revolution.

Washington. D. c., Aug. 14.-At a
time when Americans are thinking in
war terms Of billions Of dollars which
must be raised by domestic loans and
taxation it is interesting to examine
the methods employed TO finance the
first American war-the war OF in
dependence.
The total cost of the revolution. not
including the expenditures OF the in
dividual states. has been estimated at
about SsO.00o.O0O a good deal less than
one days cost Of the present war. The
sum IS truly Insignificant as com
pared with the $4,000 900 900. which
will be required TO finance Americas
share Of the war during the coming
year.
The IS colonies were certainly as
unprepared to strike a decisive blow
for freedom as any country possibly
could be. The colonies could not
bring themselves to the point OF Civ
ing what they considered too much
power TO a limited group Of men rep
resenting centralized government. and
while the congress could enact legis-
lation for an army and navy, Il could
do no more than make suggestions TO
the various states, regarding the man
ner in which these fighting forces
were to be maintained
Bills OF Credit UnEound
Greatest reliance was placed at
first upon the issue OF bills Of credit;
some foreign loans were negotiated;
domestic loans were made and a nom
inaI sum was realized through taxes
levied by the states. The bills OF
credit. however, rested upon what
proved TO be on unsound basis
Within a week after the battle OF
Bunker Hill, authority was given for
an issue OF 100000 IN credit bills,
and the amount to be redeemed be-
tween 1873 and 1852 was carefully ap-
pOrtioned among the colonies Other
issues followed. the total issue being
about S241 .552,7S0. but at no time was
that amount in circulation and seldom
was il acceptable at face value in
1873 depreciation became very marked
and from January to May OF that year.
the value Of the bills varied from 20
to one TO 3s1s to one.
Domestic Loans.
The domestic loans were more sue
cessful, although, with the exception
OF one small loan for the purchase Of
gun powder in June. 17I5; these were
not authorized until October. 1l46s
nearly a year and a half after the be-
ginning OF the revolution The fall
ure Of the bills Of credit and the pau
city OF the revenue being secured
through taxation. led congress TO
authorize the borrowing Of $5.o0o,000
at the rate OF four percent II was
found necessary at q late period to
raise the interest rate to six percent.
but through four loans the amount
realized was only sS.IS7, 900. IN Sep
TENDER. 1114. the American ENJOYS Sc
cured the first loan from France, and
that resulted in such a stimulation Of
domestic 1n1nE that mrnwT thar
time until the loan offices were
closed. S7.sS4,o00 in specie was sub
scribed.
The foreign loans obtained by the
struggling colonies during their war
for Independence are particularly in
teresting at the present time when
the United States is making such ire
m endOus loans to the various allied
countries. Through Benjamin Frank
lin, GOuveneur Morris and others
funds were obtained either in loans I
or subsidies from the government OF
France and Spain and from private 4
bankers Of Holland. France granted
subsidies OF 100000 livres in 1slt
and 100000 livres IN ISL In all, 4
these sums, which may be regarded I
as gifts. amounted to S1.996.50
The United States borrowed from I
France between 17I7 and 1873 the to-
tai sum OF s6,352.500, while Holland I
loaned the struggling nation Sl-304.- ]
900 and Spain furnished S174,11t-a I
total Of s7.S3O,517. Nor must il be
forgotten that France spent at least :
Sc, coo, 900 on the army which she sent I
to the aid Of the colonies
At the beginning OF 17S4-ten years
after the declaration OF independence J
the Indebtedness Of the national /
was S39,325. SIS.
This Indebtedness weighed FAR more /
heavily upon the people OF that time /
than the tremendous expenditure OF I
the present does upon the American /
public today.