explored. The duty was branded with the hateful CHAP. IV. epithet of an excise, a species of taxation, it was 1791. said, so peculiarly oppressive as to be abhorred even in England; and which was totally incompatible with the spirit of liberty. The facility with which it might be extended to other objects was urged against its admission into the American system; and declarations made against it by the congress of 1775, in their address to the Canadians, were quoted in confirmation of the justice with which inherent vices had been ascribed to this

mode of collecting taxes. So great was the hostility manifested against it in some of the states, that the revenue officers might be endangered from the fury of the people; and in all, it would increase a ferment which had been already extensively manifested. Resolutions of Maryland, Virginia, and North Carolina,* reprobating the assumption, were referred to as unequivocal evidences of growing dissatisfaction; and the last mentioned state had even expressed its decided hostility to any law of excise. The legislature of North Carolina had rejected with scorn, a proposal for taking an oath to support the constitution of the United States; had refused to admit persons sentenced to imprisonment under the laws of the United States into their jails; and another circumstance was alluded to but not explained, which was said to exhibit a temper still more hostile to the general government than either of

During this discussion, the legislature of Pennsylvania also passed resolutions condemnatory of the measure.

CHAP. IV. those which had been stated. It was also objected 1791. that the tax was unequal, and would be particularly burdensome on those parts of the union which afforded no substitute for ardent spirits.

When required to produce a system in lieu of that which they so much execrated, the opponents of the bill alternately mentioned an increased duty on imported articles generally, a particular duty on molasses, a direct tax, a tax on salaries, pensions, and lawyers; a duty on newspapers, and a stamp act. By their respective advocates, these were severally declared to be less exceptionable than an excise on spirits.

By the friends of the bill it was contended, that the reasons for believing the existing revenue would be insufficient to meet the engagements of the United States, were as satisfactory as the nature of the case would admit, or as ought to be required. The estimates were founded on the best data which were attainable, and the funds already provided, had been calculated by the proper officer to pay the interest on that part of the debt only for which they were pledged. Those estimates were referred to as documents from which it would be unsafe to depart. They were also in possession of official statements showing the productiveness of the taxes from the time the revenue bill had been in operation; and from these were drawn arguments, demonstrating the danger to which the infant credit of the United States would be exposed by relying on the existing funds for the interest on the assumed debt. It was not probable that the proposed duties

would yield a sum much exceeding that which CHAP. IV. would be necessary; but should they fortunately 1791. do so, the surplus revenue might be advantageously employed in extinguishing a part of the principal. They were not, they said, of opinion, that a public debt was a public blessing, or that it ought to be perpetuated.

An augmentation of the revenue being indispensable to the solidity of the public credit, a more eligible system than that proposed in the bill, could not, it was believed, be devised. Still further to burden commerce, would be a hazardous experiment which might afford no real supplies to the treasury. Until some lights should be derived from experience, it behoved the legis lature to be cautious not to lay such impositions upon trade as might probably introduce a spirit of smuggling, which, with a nominal increase, would occasion a real diminution of revenue. In the opinion of the best judges, the impost on the mass of foreign merchandise could not safely be carried further for the present. The extent of the mercantile capital of the United States would not justify the attempt. Forcible arguments were also drawn from the policy and the justice of multiplying the subjects of taxation, and diversifying them by a union of internal with external objects.

Neither would a direct tax be advisable. The experience of the world had proved, that a tax on consumption was less oppressive, and more productive, than a tax on either property or income. Without discussing the principles on which the

CHAP. IV. fact was founded, the fact itself was incontestible, 1791. that by insensible means much larger sums might be drawn from any class of men, than could be extracted from them by open and direct taxes. To the latter system there were still other objections. The difficulty of carrying it into operation, no census having yet been taken, would not be inconsiderable; and the expense of collection through a country thinly settled, would be enormous. Add to this, that public opinion was believed to be more decidedly and unequivocally opposed to it, than to a duty on ardent spirits. North Carolina had expressed her hostility to the one as well as to the other, and several other states were known to disapprove of direct taxes. From the real objections which existed against them, and for other reasons suggested in the report of the secretary, they ought, it was said, to remain untouched, as a resource when some great emergency should require an exertion of all the faculties of the United States.

Against the substitution of a duty on internal negotiations, it was said, that revenue to any considerable extent could only be collected from them by means of a stamp act, which was not less obnoxious to popular resentment than an excise, would be less certainly productive than the proposed duties, and was in every respect less eligible.

The honour, the justice, and the faith of the United States were pledged, it was said, to that class of creditors for whose claims the bill under consideration was intended to provide. No means

of making the provision had been suggested, CHAP IV. which, on examination, would be found equally 1791. eligible with a duty on ardent spirits. Much of the public prejudice which appeared in certain parts of the United States against the measure, was to be ascribed to their hostility to the term "excise," a term which had been inaccurately applied to the duty in question. When the law should be carried into operation, it would be found not to possess those odious qualities which had excited resentment against a system of excise. In those states where the collection of a duty on spirits distilled within the country had become familiar to the people, the same prejudices did

not exist. On the good sense and virtue of the nation they could confidently rely for acquiescence in a measure which the public exigencies rendered necessary, which tended to equalize the public burdens, and which in its execution would not be oppressive.

A motion made by Mr. Jackson, to strike out that section which imposed a duty on domestic distilled spirits, was negatived by thirty-six to sixteen; and the bill was carried by thirty-five to twenty one.

Some days after the passage of this bill, another question was brought forward, which was understood to involve principles infinitely interesting to the government.

The secretary of the treasury had been the uniform advocate of a national bank. Believing that such an institution would be "of primary importance to the prosperous administration of