Post date: Apr 20, 2010 8:56:1 PM
It is in itself something properly appertaining to an illustration of our chapter of "the War of Independence" and as such we here give it, to wit :
In June 1775, was made the first emission of 2,000,000 of dollars. Before the close of that year, 3,000,000 more were issued. In May 1776, 5,000,000 more were issued, in the autumn of that year 5,000,000 more, and in December, 5,000,000 more. Such frequent and large emissions began to reduce their value in the confidence of the people. In the mean time, the power of taxing was virtually denied to the Confederation. They could only recommend the measure to the states. The whole amount issued during the war was 400,000,000 dollars ! but the collections made by the continental government in various ways, cancelled from time to time about one half of it, so that the maximum of valuation at no time exceeded $200,000,000; nor did it reach that sum until its depreciation had compelled congress to take it in, and pay it out at 40 dollars for one of specie. It kept nearly at par for the first year; as it was then but about equal to the amount of specie held in all the colonies. But the quick succession of the increase tended to depreciate it, till it reached 500 for 1, and finally 1000 for 1, -- when it ceased to circulate for any value at all. Congress, after a time, exchanged forty for one, by giving the holders loan office certificates at par, and had offered to redeem the whole in the same way at 1000 to 1 when it was down at that price; but as those loan office certificates had themselves gone down to 2s. 6d. on the pound, or eight dollars for one, very few were found to avail themselves of the offer. That was their misfortune, to have been so distrustful, or so needy ! Public securities of similar character, bearing various names, such as loan office certificates, depreciation certificates, final settlements &c., and thus constituted the public debt at the end of the war. All these were worth but eight for one, until the adoption of the present constitution in 1789 when they were funded and rose to par, and thus made fortunes for many ! The whole revolutionary debt, as estimated on the journal of Congress, the 29th April 1783, not including the paper money, stood thus, viz.: Foreign debt to France and Holland, at 4 per cent -- $7,885,085 Domestic debt in various certificates, as above -- 34,115.290 ----------------- $42,000,375 At four and six per cent. interest, Making an interest of $2,415,958 per annum. To the foregoing the Secretary of the Treasury afterwards added, for claims held by several of the States $21,500,000 and then funded the whole, putting a part on interest at six per cent., postponing another part without interest for ten years, and the remainder bearing an immediate interest at three per cent. The foregoing, with the arrears of six years of interest being added, and with some other unsettled claims, made the whole debt amount to ninety four millions, which soon went up to par ! The statesmen of the Revolution were well disposed to pay their paper obligations, and alleged that they also had the ability to do so; but against these stood the inability of the people to pursue the profitable employments of peaceable times, and therefore their inability to pay taxes, even if the Congress had had the power to impose them. They could only recommend the measure to the States. They had all agreed at one time to exact an impost of 5 per cent. on all imported goods, but Rhode Island resisted the measure to the last, and without unanimity it could not be adopted ! The campaign of 1778 and `79, with an army of thirty to forty thousand men, was sustained by emissions of paper money to the amount of 135,000,000 of dollars. Thus "making it by wagon loads! " In the same time, the amount of specie received into the public Treasury was but 151,666 dollars, a weight but about a ton of coal if all put into a cart for its carriage ! It has been said that so great a sinking of paper money, was not so injuriously felt among the people as might be imagined -- and it has been reasoned that, viz.: The largest sum by which they could have been affected might be estimated at 300,000,000 at 20 for one, which is only half of the rate fixed by Congress. This would give 15,000,000 of sound money; and this, having been a currency for six years, gives an annual average of 2,500,000; which, to a population of 3,000,000 would make, in point of fact, a poll tax of but about one dollar to each; or if they be estimated by families of six persons each, would be an annual loss, to such severally, of but five dollars each ! So easy it is by figures to diminish losses, which we of the present generation have never felt ! Yet it was a painful and onerous loss to our forefathers, now all gone beyond its influence! Those who are minutely curious on this manner may consult, with profit, a late paper in the proceedings of the Philosophical Society of Philadelphia, by Samuel Breck, Esq. Source: Watson’s Annals of Philadelphia And Pennsylvania, 1857