Something has been said with regard to their paper money. I think very little can be done in favor of it; much may be said, very justly, in favor of it.
Every man of property—every man of considerable transactions, whether a merchant, planter, mechanic, or of any other condition—must have felt the baneful influence of that currency. It gave us relief for a moment. It assisted us in the prosecution of a bloody war. It is destructive, however, in general, in the end. It was struck, in the last instance, for the purpose of paying the officers and soldiers. The motive was laudable.
I then thought, and still do, that those gentlemen might have had more advantage by not receiving that kind of payment. It would have been better for them, and for the country, had it not been emitted. We have involved ourselves in a debt of £200,000. We have not, with this sum, honestly and fairly paid £50,000. Was this right? But, say they, there was no circulating medium. This want was necessary to be supplied. It is a doubt with me whether the circulating medium be increased by an emission of paper currency. Before the emission of the paper money, there was a great deal of hard money among us. For thirty years past, I had not known so much specie in circulation as we had at the emission of paper money, in 1783. That medium was increasing daily. People from abroad bring specie; for, thank God, our country produces articles which are every where in demand. There is more specie in the country than is generally imagined; but the proprietors keep it locked up. No man will part with his specie. It lies in his chest. It is asked. Why not lend it out? The answer is obvious—that, should he once let it get out of his power, he never can recover the whole of it. If he bring suit, he will obtain a verdict for one half of it. This is the reason of our poverty. The scarcity of money must be, in some degree, owing to this; and the specie which is now in this country might as well be in any other part of the world. If our trade was once on a respectable footing, we should find means of paying that enormous debt.
Another observation was made, which has not yet been answered, viz., that the demands of the United States will be smaller than those of the states, for this reason—the United States will only make a demand of the interest of the public debts: the states must demand both principal and interest,
