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CHAPTER ence, or respect at home or abroad; the state govern III. ments suffering under severe pecuniary embarrassments; 1791. and a large portion of the individuals who composed the nation overwhelmed by private debts. Commerce and industry, without protection from foreign competition, and suffering under all the evils of a depreciated and uncertain currency, exposed, also, to serious embarrassments from local jealousies and rivalries, were but slowly and painfully recovering from the severe dislocations to which first the war of the Revolution and then the peace had subjected them. Even the practicability of carrying the new Constitution into effect, at least without making the remedy worse than the disease, was seriously doubted and stoutly denied by a powerful party, having many able men among its leaders, and, numerically considered, including, perhaps, a majority of the people of the United States.

In two short years a competent revenue had been provided, the duties imposed to produce it operating also to give to American producers a preference in the home market, and to secure to American shipping a like preference in American ports. The public debt, not that of the Confederation only, but the great bulk of the state debts, had been funded and the interest provided for, the public credit being thus raised from the lowest degradation to a most respectable position. The very funding of this debt, and the consequent steady and increasing value thus conferred upon it, had given a new character to the currency, composed as it was, in a great measure, of public securities; while steps had been taken to improve it still further by the establishment of a national bank. A national judiciary had been organized, vested with powers to guard the sanctity of contracts against stop-laws, tender laws, and paper money. The practi

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cability and efficiency of the new system had been as CHAPTER fully established as the experience of only two years would admit, and the nation thereby raised to a respect- 179. able position in its own eyes and in those of foreign countries.

The Senate had unwisely imitated the reserve of the Continental Congress-a reserve necessary in time of war, but contrary to the democratic spirit of American institutions—in transacting their business with closed doors. But the House of Representatives, by opening then doors to reporters and the public, had admitted the people, notwithstanding all the alarm that had been expressed as to the monarchical and aristocratical tendencies of the new government, to a knowledge of national affairs such as they had never before enjoyed. By the newspaper reports, disseminated through the Union, the proceedings of the House became, in fact better known to the people than the doings of their own state Legislatures. These reports were very brief, compared with what we have now, yet sufficient to give a pretty accurate idea of the course of business in the House.

The funding of the public debt, however in particular instances it might have redounded to the enrichment of cunning and sordid speculators, or however deserving sufferers by former public insolvency might have been overlooked, yet in its general operation promoted, to a great, and, indeed, unexpected degree, the public prosperity. By furnishing a capital almost or quite as avaïable as cash, of which enterprise knew how to take auvantage, and by the new and powerful impulse thus given to industry, it went far toward relieving that pri vate pecuniary embarrassment which had constituted one of the greatest evils of the times. The newly funded

CHAPTER Stocks had all the advantages of the old paper money III. issues, without any of their dangers, and with the ad

1791. ditional advantage of having a value abroad as well as at home-the sale of stocks abroad, urged as one of the great objections to the funding system, being, in fact, one of its chief recommendations-the holders being thus enabled to convert these paper obligations into actua, cash. The great secret of the beneficial operation of the funding system was the re-establishment of confidence; for commercial confidence, though political economists may have omitted to enumerate it among the elements of production, is just as much one of those elements as labor, land, or capital-a due infusion of it increasing in a most remarkable degree the productive activity of those other elements, and the want of it paralyzing their power to a corresponding extent. By the restoration of con. fidence in the nation, confidence in the states, and confidence in individuals, the funding system actually added to the labor, land, and capital of the country a much greater value than the amount of the debt thereby charged upon them. Commerce and industry, thus buoyed up, had taken a great start. Favorable seasons, the attention given of late to domestic manufactures, the natural reaction from a period of embarrassment and depression, concurred with the revival of confidence, and the new arrangements in favor of trade and industry, to produce a sudden influx of prosperity. The exports rose at once to twenty millions a year, and shipping was increased so rapidly as already to have solved the doubt whether America could supply vessels enough to transport her own productions. To the profitable trade recently opened with India and China had been added another lucrative traffic to the northwest coast of America, a region then almost unknown, now so familiar as California and O10

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Between this trade and that to China there was CHAPTER a close connection, the great attraction to this coast being the rich furs of the sea otter, purchased for trinkets 1791. and sold in China at an immense profit. The ship Columbia, Captain Gray, of Boston, one of the pioneers in this traffic, after exploring with her consort, the sloop Washington, the coast north and south of Nootka Sound, had returned home by the way of Canton and the Cape 1790. of Good Hope, thus completing the first American voyage round the world. Already on almost every sea the stripes and stars began to wave. In a second voyage Captain Gray entered for the first time the mouth of the 1792. Columbia or Oregon River, an exploration relied upon by the United States, in their controversy with Great Britain many years afterward as to the ownership of that region, as affording a claim of title by discovery.

May

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CHAPTER IV.

INDIAN WAR IN THE WEST. FIRST SESSION OF THE SEC,
OND CONGRESS. STATE OF PARTIES. JEFFERSON, AD
AMS, AND HAMILTON. FIRST CENSUS. NEW APPORTION.
MENT OF REPRESENTATIVES. THIRD TARIFF. MILITIA
POST-OFFICE. MINT. JUDICIAL PROCEDURE. REVOLU
TIONARY CLAIMS. ELECTORS OF PRESIDENT. CONSTITU.
TIONS OF KENTUCKY, DELAWARE, AND NEW HAMPSHIRE.

SHORTLY after the adjournment of Congress, Washington started on a three months' tour through the 1791. Southern States. If not received with quite the same high-wrought enthusiasm which had marked his journey through New England, he was yet every where entertained with cordiality and respect. Many measures of the government had encountered a warm resistance from the Southern members of Congress. Opposition to the Federal Constitution, which had prevailed so extensively in that region, had gradually taken on the character of opposition to the policy of the administration. Yet Washington found occasion to observe many proofs of the favorable impression on the public mind made by the working of the new system.

In the course of his journey he stopped for several days on the Potomac, taking that opportunity to exercise the authority vested in him of definitively selecting the site of the future seat of government. That selection made, the commissioners entered forthwith upon their duty. The city was laid out on a most magnificent scale, on a plot large enough to accommodate a million

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