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To reduce, one third, the estimate of revenue to arise from commerce and sales of public lands, is proper and necessary, if our object is not to deceive the people and ourselves, but to arrive at truth. These sources of revenue can hardly be said to exist. During the war, which has caused the devastation and depopulation of the frontiers, it is not evident much can be expected to be derived from the sales of lands.* During an embargo, re-enforced by an extensive and rigorous blockade of the enemy, and of itself; so rigid that it is a subject of exultation among its authors, that vessels of every description are chained to our wharves, and the ports are hermetically sealed-during a rigid enforcement of a non-impor. tation law, to be supported by another non-importation law, what revenue can be derived from commerce?
The necessity then exists to provide additional revenue to preserve the public credit, and to regard those maxims and principles set forth in such strong language, and so highly commended by the house on a former occasion.
Sir, it is an anomaly in political economy, it is a departure from the fundamental principles of public credit, to create a debt without providing the ways and means adequate to the payment of the interest. So say Gallatin himself, in his book upon finance, and the ever to be lamented Hamilton, in his works. This deceased statesman may be truly called the founder of the public credit of this nation. Called to the treasury, he found the finances of the country in the deplorable situation they are described to have been at the close of the revolution. But before the magic force of his genius, our fiscal embarrassments disappeared. He extracted order from chaos, light from darkness. He made confidence to take place of distrust and general discontent. In the celebrated report of this great man, whose services to his country are second only to those of our great political father, we find the foundation of the argument I am feebly endeavouring to sustain. “ The secretary ardently wishes (says Mr. Hamilton) to see it incorporated as a fundamental maxim in the sys. tem of public credit, that the creation of debt should always be accompanied with the means of extinguishment. This HE REGARDS AS THE TRUE SECRET OF RENDERING PUBLIC CREDIT IMMORTAL.” The comment upon this text is afforded by the financial system of Great Britain. Her chancellor of exchequer would as soon think of spunging the public debt, as to go into the market with his loan, without providing the ways and means commensurate with the demands of the government. He would be hissed off the exchange.
* The failure of the sale of lands as a source of revenue is mani. fested by the applications entertained by the house, on the part of frontier settlers, for a considerable extension of credit in their pay. Inents for purchases already made.
The public credit should be guarded with the vigilance and care due to female chastity. The federal administrations scrupulously regarded this great principle of finance. In 1798, when it was necessary, to meet the public exi. gencies, to borrow two millions of dollars in anticipation of the direct tax, the fund arising from it was solemnly pledged for the payment of the interest and the reimburse. ment of the principal. By pursuing the principles and ad. vice of Hamilton, and the practice of all well regulated governments, was the credit of this country established. The means by which it is to be destroyed, the house is now called on to sanction.
The present men in power have not only endangered the public credit by a violation of “all those principles held sacred by every country,” but they have deliberately violated the public faith. The fact is demonstrable. The eight million sinking fund, pledged for the payment of the old public debt, has also been pledged for the pay.
ment of the eleven million loan, the sixteen million loan, the seven and a half million loan, and it is now to be again pledged for the twenty-five million loan. This same sinking fund is also pledged for the redemption of the treasury bills. These treasury bills, by law, are made receivable at the custom-house for the imposts. These bills, possessing no intrinsic value-a mere artificial value imparted to them by the fund pledged for their redemption, destroy the value of that very fund. The sinking fund is rendered valueless; and may ultimately, as far as it is derivable from commerce, consist merely of these bills, which are a legal tender for commercial duties. This position is so evident that it requires no illustration.
I must now be indulged with a few remarks upon the ability of the government to borrow, or the capacity and disposition of the people to lend. It has been admitted by one gentleman that the loan would be filled. I entertain no such opinion. I believe it will fail. Unless a most exorbitant interest is given, it must fail. Nor is it likely that any premium will ensure success.
The eastern states, being free from blockade, have become the depot of most of the foreign articles imported into the United States, for the supply of the whole American continent. These articles, owing to the combined cfforts of the public enemy and our own government, cannot be paid for in the produce of the southern and middle states, and must be met by specie. If the coasting trade were not destroyed-if the trade of the several states with each other had to contend only against the public enemy, the debt thus accrued, in favour of the north, would have been discharged during the winter months, by the bulky articles of southern growth, easily transported by our coasting craft.
The president, in a manner not to be disregarded, recommended to congress to stop this traffic. The mandate was obeyed; and specie alone must go to meet the demands of the merchants of New England. This causes such a pressure from the east, on the banks of the middle and southern states, as will deprive them of the means, if they have the disposition, to fill the loan. The accumulation of capital in the state of Massachusetts alone, enables that state, by pressing New York, to reach the extreme southern end of the chain of banks. It cannot be concealed, or denied, that a very general alarm is felt for the critical situation of the banks, produced by an accumulation of capital to the north in the manner mentioned. The consequence is, that the whole circulating medium of the country is in danger. Sir, gentlemen seem not to be aware of the difficulties with which they are beset. I do not wish to ruffle their serenity, by exciting apprehensions; but they should be prepared to encounter troubles which they have hitherto been strangers to. They should be prepared for an explosion, the noise of which may not reach their ears in time for their retreat. The very foundations of the government tremble beneath it. The ground on which ministers stand is hourly washing from under their feet. They have no excuse for not providing the ways and means called for by the public exigencies but the fear of offending the people, and yet the popularity of the war is the favourite theme of its authors. A crisis has arrived in the finances of the government, which, unless promptly and vigorously met by efficient measures, will bring on certain ruin. The credit of the government once destroyed, cannot be easily reinstated. It must be destroyed, if this system is pursued.
I will proceed now, Mr. Chairman, according to my original design, to examine the points in dispute between Great Britain and our government, and endeavour to VOL. II.
tráce the events which have conducted us directly to this war. If I succeed in satisfying those, whose minds are not steeled against conviction, that instead of honestly and sincerely endeavouring to adjust our differences with Great Britain, administration has undeviatingly pursued the opposite course of provoking and exasperating En. gland, I shall at least stand acquitted for the opposition give this bill.
By referring to documents on your table, sir, it will appear that a negotiation was opened at London in 1804. It continued until 1806, when it was brought to a happy issue by the conclusion of a treaty of commerce and amity signed by Messrs. Monroe and Pinkney. It merits particular notice, that pending this negotiation, and when there was every reason to expect a beneficial result, in the same spirit of insincerity and unfriendliness which has since characterized every correspondence and negotiation with Great Britain, a law was passed by congress, through Mr. Jefferson's influence, calculated, and no doubt in. tended, to produce a rupture of the negotiation. I allude to the celebrated non-importation law of 1805. The avowed object of this act of the government was to coerce Great Britain to concede what we demandedto obtain by compulsion what was only to be secured through friendly discussion and mutual concession. This compulsory measure could have but one effect, if indeed it be not certain, that such was its object—to excite a temper and irritation in the British ministry, which would thwart the efforts of our ministers to obtain a satisfactory and honourable treaty. However it may have been intended and ardently desired, that the measure should be considered as a rod held over the British ministry to intimidate and compel compliance with our demands, yet so ardent was their desire to preserve the relations of amity and commerce with the United States, that they