United States--History--Revolution, 1775-1783; Jay, John, 1745-1829
Summary
An account of the evolution of finances. The war was provoked by taxation.
Congress issued its own bills which circulated freely and showed the general seal.
Taxation for any government is difficult because it is not agreeable. As taxes were not
levied to fund the paper money, it soon depreciated. The depreciation was not
accelerated or retarded by good or evil fortune. In order to lessen the quantity of
money, Congress called in a considerable amount to be loaned, but this step only
increased the depreciation. In the spring of 1780 it was decided to issue new paper
money, but the connection between the new money the old injured it. Reasons for the
depreciation of the new money. Laws to make the paper lawful tender, to limit the price
of goods, and to seize property for public use ruined commerce, agriculture, and
manufactures. Congress then adopted the plan of requisitioning the states for specific
articles, but this plan proved inadequate. Finally, Congress decided to turn affairs
over to executive officials. Difficulties of Morris' office until the French Minister
authorized drafts of money. But resources from France were precarious, and nothing
remained except for Mr. Morris to use his own personal property and credit. The director
of finances must have three goals: restore public credit, obtain means for carrying on
the war, and introduce vigor and economy. For the first a national bank has been
established, but credit must be established on good revenues. A poll tax, land tax and
excise tax on liquor are now before Congress. Any revenue now taken in will be
sufficient to pay the interest, and increased wealth of the country will increase
revenues. Congress has apportioned 8 million dollars, but to pay the interest on the
debt and carry on the war with vigor will require about 12 million dollars, and the
states have not yet complied. The paper money and the funded debts stand in the way. The
paper money must be brought in by taxation and destroyed, and the revenues will be
lessened by this measure. In the course of two years, the United States ought to be able
to support herself.
