misrepresentation; for with him, ethics were so subservient to politics, that in regard to men and measures, these two operations were uniformly concurrent. The measures alluded to were, 1st, the system of finance suggested by Hamilton, for the payment of the national debt, and establishment of public credit; and 2nd, the establishment of a national bank. The history of these measures, of the enlightened and patriotic views from which they proceeded, the able support and strenuous opposition of which they were the objects, you may find in the faithful narration of Marshall.*

One of the causes, which, by demonstrating its necessity, produced our present federal government, was the fact that the old confederation possessed no faculty of providing for the payment of the public debt. The old congress in which were combined inefficiently, legislative and executive powers, could only recommend to the states measures of supply. It had no authority either to prescribe or enforce those measures. The consequence of this want of punctuality and defect of capacity, was, that the vouchers of our foreign debt had greatly depreciated, and that those of our domestic debt had fallen almost to nothing. The disgrace and injustice involved in this state of things, made so deep an impression on the

middle states) possess a degree of information and steadiness not to be found in other countries." Then turning from politics he again indulges the feelings of friendship and concludes with wishing that his correspondent's family might remain "like a tree planted by the water-side, whose leaf shall not wither."

I have selected these excerpts to show how this good and great man met the storm which was raging around him, and of whose most malignant fury he was the object. Above the insults of mobs and the denunciations of demagogues, his voice was heard, uttering an eulogy over the good sense and good feeling which would soon lead the former to repentance, and a sigh over the depravity which urged the latter into wrong. Calm amid all the confusion, he looked back with elevating reflections to the noble examples of history,-forward, with strong reliance on the great Chief and the good people of his country,-and upward with perfect confidence in the ultimate dispensations of the Almighty Ruler of the universe. Thus balanced and buoyed, he met with unruffled bosom every wave of the tumult, and shamed its clamours with the breathings of friendship, patriotism and piety. Thus have I seen a swan meeting a thousand billows with a breast of down, and breathing above their hissing and howling hubbub those soft, sonorous and silvery notes which rise in rapture till they sound no more. And thus to the end did this great and good man perseverehis long, active, useful and eventful life, in public so spotless, in private so pure; his passions so subdued, his piety so exalted,-and by this long career of ethereal virtue, his immortality at length so conspicuous through the mortal, that it did not shock the religious sense of the community where he lived to hear, nor impugn the taste of his eulogist to pronounce, that "a halo of veneration seemed to encircle him as one belonging to another world, though lingering among us. When the tidings of his death came to us, they were received through the nation, not with sorrow or mourning, but with solemn awe, like that with which we read the mysterious passage of Ancient Scripture, ‘And Enoch walked with God, and he was not, for God took him.""

For the facts and excerpts in this note, see Jay's Life, Vol. I. p. 357 et seq. The concluding extract is from an address by G. C. Verplanck, Esq., written soon after Mr. Jay's death.]

* Vol. V. Ch. 4.

nation, that the first congress under the new constitution, deemed it their duty to require, by a resolution of the 21st September, 1789, the Secretary of the Treasury to report a plan for the redemption of the public debt, foreign and domestic; an instruction which, on the ninth of the succeeding January, he complied with.

This celebrated report pointed out sources of adequate revenue to be pledged by congress for the annual payment of the interest, and the regular redemption of the principal, of the whole debt which had been contracted by the nation in their struggle for independence, whether by the continental congress or by the several states. When it came to be considered by the legislature, it encountered various objections, honestly, no doubt, as they were certainly eloquently, urged. Some members objected to funding systems generally, and to withdrawing by a permanent appropriation, from the management of congress any of the legitimate objects of taxation. Others proposed that with respect to the domestic creditor he should only be paid the market price of the government paper-that is about twelve dollars in every hundred. Mr. Madison contended that a discrimination should be made between the original and the actual holder of the paper, paying to the latter the highest price it had borne in the course of its transfer, and to the former the difference between that and its nominal value-or the complement of this value-and of consequence, where the original was the actual holder, the full amount it represented. But the strongest opposition was directed against that section of the report, which included in the assumption the debts created by the states.

The objection to the plan of the Secretary, on the score of its introducing a funding system, found little support, and was quietly disposed of. The proposition to reduce the amount of debt, by availing the nation of the self-created depreciation of its own paper, was defeated by arguments drawn from its injustice, and from the bad effect it would have on the system of public credit, which it was the object of the resolution of congress and the report of the Secretary, to establish. Mr. Madison's motion to discriminate between the actual and original holders, from the eloquence and ingenuity with which he supported it, and from the specious idea it included of a remedial intervention against extortion, excited an animated and protracted discussion. But the fallacious equity on which it was founded, attended as it was by the despotic heresy of meddling with private contracts, and by the certainty that it would neither advance the credit nor reduce the debt of the nation, were ably exposed, and the proposition was lost by a large majority.

Arguments in opposition to the assumption of the state debts were derived from the great augmentation it would cause to that, which might be considered proper to the United States-an inconvenience which though momentous in itself, would have the more formidable consequence of creating such a host of dependents on the general government, and of setting in motion the power of taxa

tion on so large a scale as to endanger the independence of the states. It was alleged that the constitution did not authorize this exercise of fiscal power, and that no occasion existed for it, inasmuch as the several states were competent to the discharge of their own engagements. The difficulty of distinguishing between the liabilities they had incurred for their own local defence, and those which had arisen from their exertions in the common cause, was relied on, as was the injustice of confounding in a common operation engagements dissimilar in character and unequal in magnitude. This indefinite increase of the debt, (for the amount of the state debts was not yet ascertained,) it was urged would have a bad effect on the public credit, by creating an apprehension that the national resources would not be adequate to its punctual liquidation-a circumstance which could not fail to depreciate the paper representing it, nor to perpetuate that greatest of national evils, a public debt.

In support of the assumption it was replied that the whole debt, both that contracted by the continental congress, and that for which the several states were answerable, had been incurred in a cause common to the Union-that in no case had the ordinary expenses, or civil list, of the states, exceeded their ordinary revenues; and that their debts consequently represented the amount of service they had severally contributed to the general defence-that in these operations the states were virtually the agents of the general government, which, upon principles of obvious justice, was liable to the state creditors-that the assumption was not, as it had been described, the prodigal creation of a new debt, but the honest acknowledgment of an old one-that if it could not be denied that congress had the right to create a debt in the prosecution of a second war, it could not well be disputed that they were authorized to discharge the debt contracted in the first; that the question was one not of quantity, but of principle; and consequently was not affected by the circumstance of the state debts having not yet been accurately computed.

A multitude of tax-masters would, it was said, lead to waste in the collection, as a variety of paymasters would, to waste in the distribution of funds out of which these debts were to be satisfied, and which in either mode must be drawn ultimately from the people. Inequality would exist and unfairness be suspected both in their collection and disbursement; circumstances which while they would not alleviate the general pressure on the people, would leave many of the public creditors dissatisfied. It was said to be absurd to impute to the supporters of this measure, a desire to perpetuate the public debt, as the proposition was not to contract a debt, but to pay one, and that moreover as the express object of the assumption was to discharge the debt, it was inconsistent with common sense to attach to it the opposite purpose of perpetuating it. It was urged that the apprehension of its giving undue influence to the general government was at variance with the objection that it would give

perpetuity to the debt-for this influence must be the result of credit, which could not exist unless the debt was regularly liquidated. And it was contended that the assumption, while it would quiet a large body of citizens, would put an end to that speculation which was so anxiously deprecated.

These were the principal arguments advanced in the debate, as it was reported in the journals of the day and is condensed in the History of Marshall; and they are here recapitulated in order that you may judge whether on the part of the supporters of the assumption, there appears any thing like a design to convert our republic into a monarchy. No such design was imputed to them in the discussion; and the accusation seems to have been first propagated, as it was last repeated by Mr. Jefferson, the vilifier general of the friends and measures of Washington; predicting of these, the most pernicious consequences; and ascribing to those, the worst conceivable motives. Two features in the measure alluded to-one that no discrimination was made between the first and last holder of the public paper-the other, that the debts incurred by the several states, in a war undertaken by common consent and prosecuted in common defence, were put on the same footing with those contracted by the general government-were made the occasion of his charge upon Hamilton especially, and the political supporters of Washington generally, of a design to subvert our republican institutions, and to establish a monarchy on their ruins.

This calumny which he specifies (Vol. IV. p. 145, et passim.) as, "a longing for a King, and an English King, rather than any other"-he invented in 1791, when the wounds received by these valiant patriots in liberating us from an English King, were yet fresh and bleeding-and maintained until the day of his death in 1826, with an evergreen vivacity of slander, which drew rancour from the frosts of age, and spread forth its poisonous branches, as the graves of its victims thickened around. To every age, and through every state, it was distributed by his correspondence. The credulity of the young, the prejudices of the old, and the interests of both, were enlisted in its circulation; and not content with defaming the ornaments of his country at home, he industriously proclaimed this calumny abroad. Lafayette and Kosciusko were assured that their chosen friends in the United States had been defeated in an attempt to undermine the liberties of their country; and Mazzei, an Italian adventurer, was made the instrument as you will see of diffusing the falsehood throughout Europe.

LETTER V.

Or a charge so extensively circulated and so long maintained, as that alluded to in the close of my last letter, it is worth while to examine the foundation, especially as the station of its author and the character of its objects, both tend to give it importance; and as on its truth or falsehood, the moral colouring of our national history must greatly depend.

By reference to the Anas, at the end of his fourth volume, it appears that in the year 1818, Mr. Jefferson revised all the imputations he had made or collected against this illustrious body of his countrymen, and therein it will be found he repeats, in the most imposing form he could give it, this particular slander. (447, 8, 9.) In regard to the former branch of it, the making no discrimination between the first and last holders of government stock, he affirms that it was a stratagem devised by Hamilton to gratify speculators, and to attach to himself a band of mercenary supporters who were to be his instruments in overturning the republic. In proof of this affirmation he proceeds as follows-"When the trial of strength on these several efforts had indicated the form in which the bill would finally pass, this being known within doors sooner than without, and especially than to those who were in distant parts of the Union, the base scramble began. Couriers and relay horses by land, and swift-sailing pilot boats by sea, were flying in all directions. Active partners and agents were associated and employed in every state, town and country neighbourhood, and this paper was bought up at five shillings, and even as low as two shillings in the pound, before the holder knew that congress had already provided for its redemption at par. Immense sums were filched from the poor and ignorant, and fortunes accumulated by those who had themselves been poor enough before. Men thus enriched by the dexterity of a leader, would follow of course, the chief who was leading them to fortune, and become the zealous instruments of all his enterprises.

Let it be remembered that among the principal objects of reconstructing the form of the federal government was that of enabling the people of the United States to discharge the debt they had contracted in the war of Independence;* that the initiation of a plan for the accomplishment of this object was imposed, both by the nature of his office and a resolution of Congress, on the Secretary of the Treasury; and does it seem consistent with common justice,

* See Gen. Washington's letter to the governors of the several States. (Marshall, Vol. V. p. 48.)