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duties on distilled spirits imported from foreign countries, which are specified in the act making further provision for the payment of the debts of the United States, namely: [Here follows a detailed statement of the proposed duties.]

The product of these several duties (which correspond in their rates with those proposed in the report above referred to, of the ninth of January last) may, upon as good grounds as the nature of the case will admit, prior to an experiment, be computed at eight hundred and seventy-seven thousand and five hundred dollars, the particulars of which computation are contained in the statement which accompanies this report.

This computed product exceeds the sum which has been stated as necessary to be provided, by fifty thousand eight hundred and seventy-five dollars and twenty-seven cents; an excess which, if it should be realized by the actual product, may be beneficially applied towards increasing the sinking fund.

The Secretary has been encouraged to renew the proposition of these duties, in the same form in which they were before submitted, from a belief, founded on circumstances which appeared in the different discussions on the subject, that collateral considerations, which were afterwards obviated, rather than objections to the measure itself, prevented its adoption, during the last session; from the impracticability, which he conceives to exist, of devising any substitute equally conducive to the ease and interest of the community; and from an opinion that the extension of the plan of collection, which it contemplates, to the duties already imposed on wines and distilled spirits, is necessary to a well grounded reliance on their efficacy and productiveness.

The expediency of improving the resource of distilled spirits, as an article of revenue, to the greatest practicable extent, had been noticed upon another occasion. Various considerations might be added to those then adduced, to evince it, but they are too obvious to justify the detail. There is scarcely an attitude in which the object can present itself, which does not invite, by all the inducements of sound policy and public good, to take a strong and effectual hold of it.

The manner of doing it, or, in other words, the mode of collection, appears to be the only point about which a difficulty or question can arise.

characterize whatever plan may be adopted. One of them makes the security of the revenue to depend chiefly upon the vigilance of the public officers; the other rests it essentially on the integrity of the individuals interested to avoid the payment of it.

The first is the basis of the plan submitted by the Secretary; the last has pervaded most, if not all the systems, which have been hitherto prac tised upon, in different parts of the United States. The oaths of the dealers have been almost the only security for their compliance with the laws.

It cannot be too much lamented, that these have been found inadequate dependence. But experience has, on every trial, manifested them to be such. Taxes or duties, relying for their col lection on that security, wholly, or almost wholly, are uniformly unproductive. And they cannot fail to be unequal, as long as men continue to be discriminated by unequal portions of rectitude. The most conscientious will pay most; the least conscientious, least.

It may not be improper further to remark, that the two great objections to the class of duties denominated excises, are inapplicable to the plan suggested. These objections are, first, the sum mary jurisdiction confided to the officers of excise, in derogation from the course of the common law, and the right of trial by jury; and, secondly, the general power vested in the same officers, of visiting and searching, indiscriminately, the houses, stores, and other buildings, of the dealers in excised articles. But, by the plan proposed, the officers to be employed are to be clothed with no such summary jurisdiction, and their discre tionary power of visiting and searching, is to be restricted to those places which the dealers themselves shall designate, by public insignia or marks, as the depositories of the articles on which the duties are to be laid. Hence, it is one of the recommendations of the plan, that it is not liable to those objections.

Duties of the kind proposed are not novel in the United States as has been intimated in another place. They have existed, to a considerable extent, under several of the State Governments, particularly in Massachusetts, Connecticut, and Pennsylvania. In Connecticut, a State exemplary for its attachment to popular principles, not only all ardent spirits, but foreign articles of consump tion, generally, have been the subjects of an excise or inland duty.

If the supposition, that duties of this kind are attended with greater expense in the collection, than taxes on lands, should seem an argu

ment for preferring the latter, it may be observed that the fact ought not too readily to be taken for granted. The state of things in England, is sometimes referred to as an example on this point, but, there, the smallness of the expense in the collection of the land tax, is to be ascribed to the peculiar modification of it, which, proceeding without new assessments, according to a fixed standard, long since adjusted, totally disregards the comparative value of lands, and the variations in their value. The consequence of this is, an inequality so palpable and extreme, as would be likely to be ill relished by the landholders of the United States. If, in pursuit of greater equality, accurate periodical valuations or assessments are to afford a rule, it may well be doubted whether the expense of a land tax will not always exceed that of the kind of duties proposed.

* *

Among other substantial reasons which recommend, as a provision for the public debt, duties upon articles of consumption, in preference to taxes on houses and lands, is this: It is very desirable, if practicable, to reserve the latter fund for objects and occasions which will more imme. diately interest the sensibility of the whole community, and more directly affect the public safety. It will be a consolatory reflection, that so capital a resource remains untouched by their provision, which, while it will have a very material influence in favor of public credit, will, also, be conducive to the tranquillity of the public mind, in respect to external danger, and will really operate as a powerful guarantee of peace.

But, in order to be at liberty to pursue this salutary course, it is indispensable that an efficacious use should be made of those articles of consumption which are the most proper and the most productive, to which class distilled spirits very evidently belong; and a prudent energy will be requisite, as well in relation to the mode of collection, as to the quantum of the duty.

It need scarcely be observed, that the duties on the great mass of imported articles have reached a point which it would not be expedient to exceed. There is at least satisfactory evidence that they cannot be extended further, without contravening the sense of the body of the merchants; and, though it is not to be admitted as a general rule, that this circumstance ought to conclude against the expediency of a public measure, yet, when due regard is had to this disposition which that enlightened class of our citizens has manifested towards the National Government

*

#

* there

will be perceived to exist the most solid reasons against lightly passing the bounds which coincide with their impressions of what is reasonable and proper. It would be, in every view, inauspicious

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to give occasion for a supposition that trade alone is destined to feel the immediate weight of the hands of Government, in every new emergency of the treasury.

However true, as a general position, that the consumer pays the duty, yet, it will not follow, that trade may not be essentially distressed and injured, by carrying duties on importation to a height which is disproportionate to the mercantile capital of the country. It may not only be the cause of diverting too large a share of it from the exigencies of business, but, as the requisite advances to satisfy the duties, will, in many, if not in most cases, precede the receipts from the sale of the articles on which they are laid, the consequence will often be sacrifices which the merchant cannot afford to make.

The inconveniences of exceeding the proper limit, in this respect, which will be felt everywhere, will fall with particular severity on those places which have not the advantage of public banks, and which abound least in pecuniary resources. Appearances do not justify such an estimate of the extent of the mercantile capital of the United States as to encourage to material accumulations on the already considerable rates of the duties on the mass of foreign importation.

A diversification of the nature of the funds is desirable on other accounts. It is clear that less dependence can be placed on one species of funds, and that, too, liable to the vicissitude of the continuance, or interruption of foreign intercourse, than upon a variety of different funds, formed by the union of internal with external objects.

The inference, from these various and important considerations seems to be, that the attempt to extract wholly, from duties on imported articles, the sum necessary to a complete provision for the public debt, would probably be both deceptive and pernicious - incompatible with the interests not less of revenue than of commerce; that resources of a different kind must, of necessity, be explored; and the selection of the most fit objects is the only thing which ought to occupy the inquiry.

To these more direct expedients for the support of public credit, the institution of a national bank presents itself, as a necessary auxiliary. This the Secretary regards as an indispensable engine in the administration of the finances. To present this important object in a more distinct and more comprehensive light, he has concluded to make it the subject of a separate report.

*

Washington's message - Enactments - Admission of North Carolina, Rhode

The first session of Congress adjourned September 29, 1789, and shortly afterward Washington, who had been seriously ill in June, determined to make a tour through the Eastern States, for the double purpose of regaining health and of observing the general condition of that section of the country. Accompanied by Tobias Lear and Mr. Jackson, his secretaries, and traveling in his own private equipage, he set out on October 15 and proceeded by way of New Haven, Hartford, Worcester, Boston and Newburyport, as far as Portsmouth, New Hampshire. On his return journey he took a different route through the interior, and reached New York on November 13. On this trip he was much impressed by the respect paid him by all classes of people.* Salem gave a ball

Of this and later journeys we have Washington's own account in his Diary from 1789 to 1791;

"Publicola "- Jefferson's introduction

in his honor, and Portsmouth a harbor excursion; at Hartford he in

embracing the opening of the first Congress, and his tours through New England, Long Island, and the southern states. Together with his journal of a tour to the Ohio in 1753, edited by Benson J. Lossing (Richmond, 1861) and published by the Virginia Historical Society. Other records of his progress are in William S. Stryker, Washington's Reception by the People of New Jersey in 1789 (Trenton, 1882), and for New York in Griswold, Republican Court, p. 134; Hildreth, United States, vol. iv., p. 55. See also Sparks, Life of Washington, p. 421; Irving, Life of Washington, vol. v., chap. vi.; McMaster, United States, vol. i., pp. 565-566; Lodge, George Washington, vol. ii., pp. 73-75. For the incident of Hancock's failure to call upon the President promptly, see Incidents in the Life of John Hancock as related by Dorothy Quincy Hancock Scott (from the Diary of Gen. W. H. Sumner), in Magazine of American History, p. 508 (June, 1888). See also Ford's ed. of Washington's Writings, vol. xi., p. 444, note i; Fisher Ames, Works, vol. i., p. 74; Sparks, Correspondence of the Revolution, vol. iv., p. 289; Memorial History of Boston, vol. iii., p. 199; Barry, History of Massachusetts, vol. iii., p. 310 and references. The views of Hancock's political enemies will be found in Stephen Higginson, The Writings of Laco, as published in the Massachusetts Sentinel, February and March, 1789 (Boston, 1789). reprinted as Ten Chapters in the Life of John Hancock (New York, 1857).

spected the manufactories; and at Cambridge saw the great elm under which he took command of the patriot army. Upon his arrival at Boston a trade procession with banners appeared, its ranks opening from Roxbury line to the old State-house. He was highly pleased with the journey and greatly astonished both at the marvelous growth of manufactures and commerce in New England and at the general contentment of the people with the new government.*

On January 4, 1790, Congress reassembled, and on the 8th Washington's first annual address was delivered. The President spoke of the general prosperity of the country, and recommended that Congress take under consideration a number of important subjects, particularly the matter of providing proper means of defence for the sea coast. He said: "To be prepared for war, is one of the most effectual means of preserving peace. A free people ought not only to be armed, but disciplined; to which end, a uniform and well digested plan is requisite; and their safety and interest require that they should promote such manufactories. as tend to render them independent of others for essential, particularly military, supplies." He suggested that means be provided to maintain

Schouler, United States, vol. i., p. 130. Lodge, George Washington, vol. ii., p. 76 et seq. For text, see Richardson, Messages and Papers, vol. i., pp. 65-67; Annals of Congress, vol. i., pp. 932-934.

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intercourse with foreign nations; that a uniform rule of naturalization be established, and that literature and science be promoted, since "Knowledge is in every country the surest basis of public happiness. In one in which the measures of government receive their impression, so immediately from the sense of the community as in ours, it is proportionately essentiol. Whether this desirable object will best be promoted by affording aids to seminaries of learning already established, by the institution of a national university, or by other expedients, will be well worthy of a place in the deliberations of the legislature." The speech closed with a recommendation that an efficient system for supporting the public credit be provided.

Among the laws of a general nature passed were those for the naturalization of aliens after two years' residence; for the patenting of inventions; for securing to authors the copyright of their productions; regulating the merchant marine in respect to the seamen engaged in it; forming the ground work for a criminal code; for a military establishment; for arranging the means of intercourse with the Indians regarding trade and the acquisition of territories owned by them, etc. After returning thanks to the corporation of the city of New York for the accommodations furnished, Congress adjourned August 12, 1790, to meet again in December at Philadelphia.

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As stated above, one of the acts of this session dealt with the patenting of inventions. The Eastern States had grown wonderfully during the past few years, and as commerce and manufactures advanced, new devices of all descriptions were invented. In order to ensure to the inventor the fruits of his labor, it was essential that some government office be established where a model of the invention could be registered for the purpose of determining possible infringements. Accordingly, Jefferson inspired a patent system, which formed the basis of the law of April 10, 1790.* This established a Patent Office and made the Secretary of State, the Secretary of War, and the Attorney-General a board of commissioners to examine the claims of inventors, and to issue patents to

deserving applicants. From the decision of this board there was to be no appeal. Only three patents were issued in 1790,† 33 in 1791, 11 in 1792, and 20 in 1793. But upon complaint of the unsuccessful applicants that the powers of the commissioners were too great and too arbitrary, in 1793 the patent law was revised for the worse, since it now granted all those powers to the Secretary of State alone. This law contin

* Schouler, United States, vol. i., p. 143.

Bishop, History of Manufactures, vol. ii., p. 21. McMaster, vol. ii., p. 160. For the year ending December 31, 1911, there were 33,927 patents granted, including designs, and 157 patents reissued. Prior to July 1, 1836, there were 9,957 patents issued, and up to December 31, 1911, this number had increased to 1,023,051. See the Annual Reports of the Commissioners of Patents.

ued in force for forty-three years (until 1836), when it was again revised.

That same year the Post Office Building, containing the Patent Office, was destroyed by fire, and in this conflagration 7,000 models were lost. Among them were models of a graincutter, a dock-cleaner, and a threshing-machine, the invention of Leonard Harbach, of Baltimore; a watermill for roping and spinning combed wool and flax; a candle-machine invented by Benjamin Folger, of Hudson, New York; a diving apparatus invented by Mr. Torrey, of Lebanon; and a new method of turning iron into steel, devised by Henry Voight.* The most famous, however, was the cotton-gin, invented by Eli Whitney, the essential features of which are used in cottonginning machinery at the present time the world over.† Whitney had invented this machine in Georgia, but before his patent had been secured, · some rascals broke into his workshop and carried off the model. Whitney then went to Connecticut, where he completed a new model, upon which a patent was granted on March 14, 1794. To guard his rights, Eli Whitney was subjected to the annoyance of endless suits, losing many thousands of dollars in defending them.‡

* McMaster, vol. ii., p. 161.

See article by John R. Fordyce, Cotton-Ginning Machinery in Encyclopedia Americana, vol. v.

Bishop, History of Manufactures, vol. ii., pp. 48-50, 69-70; Hammond, The Cotton Industry, pp. 24-30; Olmsted, Memoir of Eli Whitney; Hammond (ed.), Correspondence of Eli Whitney