to expect a liqnidatidn of the demands of the States, and without
the latter, he ihould despair of a continuancc ol the national
union.
Mr. Sedgwick, obfervcd that there was another very important
light in which the fubje£l might be viewed, viz. the probable
consequence which would flow from the mode or modes which
might be adopted, for the dilcharge of the state debts. II laid
he, they are left on the (boulders oPthc state legislatures, the ci
tizens will be very unequally burdened, to difchargc demands
which they will rcafonably consider as unjust. This will create or
continue invidious diftinttions between ftatcs and their citizcns.
It will further promote a spirit of emigration among the Hates,
■which fuffer the moll, which will encreafe the load, on those who
(hall remain behind, and finally, render it intolerable.
There was, he further observed, ar. evil yet unmentioned of a
nature infinitely more malignant and dangerous—that principle of
tooftility, which from this state of things, would be unavoidable,
between the national and state governments; for it was easy to
forefee that the sources of revenue, over which the two kinds of
government, had a concurrent contratt, would be seized on by
t-ach, to the oppreflion of the people and the discouragement of
industry. That hence would ensue a war of legislation, aided
on each fide, by panizans made active, by the powerful incen
tives of felf interrft ; tor there would exist an obvious opposition
of intercft, between the national and the State creditors. That
in such a state ofconfufion, theintereft of both would probably
be injured, and the very being of the government brought into
clanger.
The States, for theif own fakes, would put their debts on a foot
ing as refpettable as poflible : To do this, they mult have recourse
to direst taxes, and to duties of excise. The former would be
found inadequate to the purpose, and carried to an/ considerable
degree, would be oppreflive, unpopular, and might be dangerous.
Ifexcifes were tried, the advantages of commerce would be ren
dered very unequal in different States : Hence would arifc a mo
tive for transfering mercantile capitals from one State to another.
And he aflud, whether in this way there wasany reasonable foun
dation to hope that we Ihould become or continue a nation ?
Mr. $edwick further observed, that he fuppofedSno one would
imagine that by the adoption of a national government, any addi
tional ability, in regard to the collettion of taxes,was given to those
of the States : That it would be unneceflary to remind gentlemen
in how difgracfful a situation the securities of States now were—
constantly fluctuating, aud (hrinking from the grasp of the pub
ic creditor, they affoided only a profit and employment, to an
army of speculators, roaming from town to town and from village
to village, purchasing of the needy holder, in the moment of dif
appointmcnt, when the market was low and felling again when it
rife.*.
On the other hand said Mr. Sedgwick " the advantages of the
opposite policy are manifeft A and certain.—lt will make this go
vernment the centre of the wishes and affettions, of the property
of the countrv---and enable the government riches, to repay for
these advantages, in the encouragement it will afford, to industry
and to every ufeful improvement and occupation.—lt will termi
nate in the fuppreflionol direst taxes—lt willabolifh invidious dif
tinftions between States and their citizens—lt will fix the value of
the State securities and bring them into operation as a circulating
medium—lt will give opportunity to the States to attend to the
improvement of their internal police, and will more than any o
ther measure 1 have contemplated constitute us in fa& a nation, a
great, flourifhing and happy people."
He concluded by observing, that should any number of the
Stares fund their debts, which at this very time was attempting
by some, the difficulties in the attainment of this desirable object
would be greatly encreafed.
THURSDAY, FEP.. 25.
In committee oj the whole. The ajjumption oj the State Debts Jlill under
con ft deration.
Mr. White said he felt himfelf rather in a disagreeable situa
tion, when he rose to oppose a proportion which was countenan
ced by so many refpettable patrons. He thought the original pro
portion on the table would however be less exceptionable by the
adoption of the amendment proposed by his colleague (Mr. Madi
son) becaufc it would remove some of the difficulties that other
wise would rcfult from it.
In stating his objettions, he remarked, that if he understood the
meaning and force of the proportion, it would have this effect,
that the States who have made exertions, and nearly paid the whole
of the proportion of their federal debt, should, notwithstanding,
contribute to the payment of the delinquenres of others ; this ap
peared to him tobeuniuft. To have a tight view of the matter,
none of the Statfscould properly be conlidered as creditors of the
Union, unless they had contributed in a greater degree than was
required of them, in proportion to their wealth and number of
citizens. Toillultrate this argument, he would suppose that the
proportion of theexpence for MalTachufetts and Virginia should
each be 10,000,000, then if MaflTachufetts (hall advance 15,000000
she would be a creditor for 5,000000, whereas if Virginia should
have advanced no more than the 10,000000, than (he would have
paid no more than her just proportion, and could have no demand
on the Union. Again, if (he had advanced no more than 000000
ftie would justly owe 2,000000, which Congress could not aflume
to pay without injury to the other. He therefore thought it just,
that whatever sum might appear 011 the liquidation of the account
to have been advanced by a State beyond its equal proportion, that
that fliould be affumcd by the Union, and no other. He had also
an obje&ion to the amendment, by which a door was to be open
ed for all claims; th/s might induce the States to bring forward
claims thereby the public debt might be unduly increafcd. For
the States generally thinking themselves creditors, it would create
a jealoufv, and there would be a general searching for and admit
ing of claims, to rhe great injury of the Union. This inconven
ience he thought would result.
Other incpnvenicncies might p'occd from this circumstance ; in
fomeof the States the creditors might relufo to accept the proposal :
He thought this would be the cafe in Virginia, because in that State
their debts wefre well funded at 6 pr. cent. and the intercft regu
larly paid ; fuppoling this event to take place, what would be
the coniequence ? tne State of Virginia would have to levy taxes
to pay this intercft, and at the fame time contribute to pay that of
other States; difficulties might aiifc Qn this ground, that to him
appeared (Wious
It appeared bcthe intention of thelloufe to fund all thedebt,
and to make no arrangement lor the difchargc thereof; this he
could not approve of. Perpetuating a public debt, he did not con
ceive advantageous to any country.
Gentlemen seemed dazztfd with thefplcndor of Great Britain,
supposing her profperitv i< owing to her debts ; but the-- rcverfe
is the cafe—it was her peculiar circuniJUmc<« which ei abled her to
lupport her debts—tljather wealth and power weic owing to the
fpint and indullrv of her inhabitants—to J»cr natural advantages
of foil, climate, and situation, and to the great Security of proper
ty under a free constitution ; that however, were he an Englifh
rnan, he would tremble for the event : Sure he was, that at a per
iod not very remote, the nation must fink under the weight of the
debt, or it mutt be wiped out with a fpunge to the ruin of thou
sands.
The fnme confluence mightfollow the perpetuation of the debt
in thefeStates, though the period might be more remote. If the
States were left to thcmfclves they would pursue measures to ex
ttnguifti the debts; this was an object desirable to accomplish.
The State of Virginia he knew had cxtingujftied more than
«,coccoo of dollars of her public debt. But Virginia was not
alone, there were other States he believed, that had also effc&ed a
considerable diminution of their debts.
Jt had been urged, he fa id, as an argument in favor of the mea
sure, thaf unless these debts were a (Turned, that some of the States
would be induced to Jay and thereby put it out of the
power of the government to nife money fiotn that fouree ; hut
the excise and the impost would not do ; no adequate provision
for the payment of the intereil could be drawn from thefc lources.
The Secretary had proposed to raise the duty on various articles;
but his calculations did not reach a provision tor the State debts ;
he had only contemplated those of the Union. How then was the
State debts to be provided for ? Would Congrefslevy a land tax ?
As to raising the import, it was a measure he dreaded ; as the du
ties now flood he believed there were no attempts to evade them
by smuggling. But if they were raised, the revcrfe would take
place ; and if the people once becamc habituated to smuggling,
it would be impofiible at any future day to reform them, even by
lowering of the duties. With refpett to dire# taxes, he wiftied
the committee to consider how that would be relished throughout
the Union : He thought it would be contrary to the general sense
of the people. When they accepted the Constitution, it is true
they knew it contained a power to levy taxes ; but it was not ex
pected that this pouer would be exercised in the present fkuation
of the country. It would leflen the influence of the States : They
would be reduced a degree lower than they should be, while at
the fame time the general government would be elevated on their
ruin.' This would be unjust and impolitic. The freedom and
happiness ot America depended as elTentially on the State govern
ments as the general government —perhaps more so. It was an
interference between a State and its citizens ; and attaching them
to the general government without the consent of the State.
It had been said by a gentleman from New-York that it was
easier for one body to draw forth the resources of the community
than for a diftinft number of legiQatures—this was true ; but he
asked if it would l>e administered on the principles of freedom
and independence. Congress may be properly the supreme coun
cil, but not the supreme legislature of the United States. Their
legislative powers were circumscribed and confined to particular
obje&s. Because it might be more convenict>t, it did not follow
that Congreft should for that reason exercise such authority.
It had urged as a reason for the afTumption of tbefe debts,
that the continental securities had in general been purchased at
low rates, and had centered principally in populous cities—and
that the people would not be fatisficd to pay taxes for them, and
have their money continually drawn into these cities—unless the
State debts were adopted, whereby the taxes would go back a
gain into tbc~rcniote parts of the country.
He said he was sensible that the people would very ill brook
the payment of taxes when they saw the amount flow into the
hands of a few individuals. That he had mentioned thrs in a
former debate, and which would have been remedied had a mode
which he thought equitable to render them diffufive been adopted.
But the measure was over-ruled ; —the present he thought unjust
and therefore could not agree to it.
It had been said that the legislature of South-Carolina had de
clined making provision for her creditors, in expectation that
Congress would afTume her debts—he did not doubt the intelli
gence—but how the legislature of a State could conceive that Con
gress would afTume to pay her debts was to him extraordinary—
sure he was that Congress had never exprefled such an idea, and
he hoped that things had not yet taken that turn, that whatever
was devised in the cabinet, should be agreed to in the legislature
—No regard therefore ought to be paid to what South-Carolina
had done.
But a gentleman from Maflachufetts supposed that it would not
lessen the influence of the State governments, that, on the contrary,
it would he an advantage to them.—That it was an old do&rine,
out of debt, out of danger.—But the measure did not place the
States out of debt—they were Hill to pay it—the means of pay
ment being only put into other hands—Sir, said he, if I was in
debted on an open account, and I remain in poflfeflion of my es
tate, and was able to pay it, would it be any advantage to me to
give my creditors a mortgage on my land, and put him into im
mediate pofleflion of the profits of my eftatc. Is the cafe not ap
plicable—we do not propose to pay the debts of the States but
with their property. Is this conferring any favor ? Surely not.
He would propose, in order to bring the matter to a point, that
the assumption of the State debts fliould be confined to such parts
only as appeared to be a surplusage, that any State (ball have ad
vanced beyond its just and equal proportion of the expences in
curred in the defence of the common rights of America. This
surplusage to be ascertained on a liquidation of the account.
Mr. Lawrance observed, that it appeared to him that the result
of the plan proposed by the Secretary would be exactly what the
gentleman had in view—-He stated a particular example to (Hew
that the operation would produce the fame effect.
He therefore thought tl>e last amendment unneceflary ; but the
amendment proposed yesterday he acquiesced in, he supposed it
would meet the approbation of gentlemen in all parts of the union
—He answered the'obje&ion refpetting the importance of the
Statesretaining their debts, that the legislatures of them may meet
and have something to do, in providing for the payment of those
debts—he did not believe that it was considered by the people as
neceflary to the importance of the States, that their legislatures
fliould meet merely for this purpofc.—He answered other objec
tions refpe£ling the interference with the State governments—the
funds he had no doubt would prove fully adequate to all the purpo
ses for which theSecretaiy had designated them without any necefli
ty for direst taxes, those he trusted would be left to the States fort he
lupport of their particular governments. He concluded by ob
serving that the more he contemplated the measure, the more he
was convinced ot its propriety, its justice, and its economy—he
doubted not that every part of the union would chearfully acquiesce
in every measure th. t append to be necessary to be adopted to
piomotethe general interest.
Mr. Moore.—Mr. Chairman, said he, I cannot understand the
propofuion now on your table, in the fame light in which the
gentleman lsft up has stated it; nor can I think its effects will be
the fame with that which my colleague has now offered. If I
understand the different propositions—by the firft, <very citizen
in the United States may bring forward his certificate, and loan it
to the United States; on which he is intitled to an intcreft ; his
claim is to be alfumed and funded. The amendment proposes,
that, after an adjustment of all the claims of the States, has been
made, that Congress will assume the 'payment to each State, what
ever (he may appear to have paid, on a final settlement, more than
her jufl (hare or proportion ; but leave it to the States to pay their
refpe&ive citizens, their ciaims, in whatever mode they please.
In the one cafe, Congress only assume the balances due ; in theo
thcr they assume the whole debt. Sir, I think wc have not fuf
ficiently ascertained the amount of the debt ; this ought firft to be
done, before we alfume the payment. The Secretary has Hated to
us the supposed amount ; I make no doubt he has obtained everi
poflible information on the fubjeft. B.ut even fuppole him to be
in poircfiion of the amount of the fettled claims in all the dif
ferent States, it would not ascertain it with futficicnt certainty
It is proposed that the acts limiting the settlement of claims
(hould be repealed ; that further time (hould be given to claim
ants to come forward. Gentlemen appear impressed with the
justice ot this proposition. To what extent are they likely to be
increased ? II gentlemen will only consider the number of peti
tions that have been presented to Congress, by claimants whole
claims appear to be just, they will be fatisfied, that when the bar
to settlements is removed, many new claims will be brought for
ward, and the debt will be increased far beyond the present ftate
mcnt. Sir, before we alTume the payment, vie ought to know
that our resources are co-extensive with the demand, under every
polfible diminution that ran in the nature of things take p'ac-
Should we now assume them, and our means be inadeqtiaie to the
end, I know not of nny procedure that could more cffeflually
ruin the credit of the United States.—But mv principal obictlton
to the original proposition is. that wc shall be obliged to lav a
direfttax. What are the resources the Secretary intends propo
ang ? They oughi firft to be brought to view. I remember well
-382-
when the import bill was before us, Wcw*retoldby gentlenrn
well informed on that fubjeft, that if we increafcd the duties it
would defeat our purpose ; that if would promote .
that on foextenlive a sea coast, where we have so many harbors °it
would be impoflible to prevent it, if we raised duties so
to make it the interest of the merchant to fmu«rgle. We wer*
likewifc told, that laying the duties too high would prevent the
coniumption, and tend to defeat the revenue. Gentlemen then
brought forward every fubjett they could think of, as proper, on
which to lay a duty. I conceive thai if we aflume the entire
debt, no additional duty adequate to the payment of the interest
of the whole debt, can now be laid ; we mud lay direst taxes
A gentleman yesterday observed, that a revenue migjit be col
letted by Congress with more convenience than the States, at less
expence, and more effectually. I think we cannot lay a dire# tax
in a manner so convenient to the citizens, at so small an expence ;
or that the collection will be so effe&ual. Sir, lam of opinion
that the immediate representatives of the people in their States
can lay a tax which the people can more conveniently pay : Tliev
can accommodate not only the fubjefls of taxation, but the tunc
of payment, more to the convenience of the citizens; they are bet
ter informed of their circumstances, and their representation i 9
more equal, than in this body. Sir, I will not undertake to fay
it is unconstitutional ; but I know it is contrary to the light m
which the constitution was contemplated when it was adopted.
The words of the Constitution are, That Congress shall have pow
er to impose duties, excise, and direst taxes, to pay the debts of
the United States. I believe Congress, from the firft forming of
the confederation, held up a diftindtion between debts of the
United States, and State debts.
I have not had recourse to the journals of Congress so as to be
certain that this diftinftion has been uniformly made ; but mftan
ccscome within my knowledge which prove it. In the requisi
tions to the Slates the diftin&ion is made. The State of Virginia
from her indiscriminate mode of adjulting state and continental
claims, has been refufed a settlement of her claims against the Uni
ted States, and commiflioners are appointed to ascertain her claims
against the United States.
Sir, I think the fr3mers of the constitution contemplated the
payment of the debts of the United States only. But from our
a (Turning the State debts, they become debts of the United States,
and we are to pay them.
I remember well when the constitution was under difcuflion
in the convention of Virginia ; the power of imposing a direst
tax was warmly opposed : The advocates for its adoption, ftatrd
that requisitions weie found to be ineffe&ual—that occasions might
happen in which such a power would be necessary—that it never
would be exetcifed but in cafe of neccflity ; but we are about to
attempt it when no such neceflitv exists. If that convention had
supposed it would have been attempted at so early a day, I think
they would not yet have adopted the constitution.
Mr. Chairman, gentlemen complain that their citizens are op
pressed with taxes : They fay that from their extraordinary exer
tions during the war, they have incurred a debt far exceeding their
just proportion. I think the amendment proposed by my eoJ
league, (Mr. White,) will do them ample justice—whatever furti
they have paid over and above their jurt proportion, Congress will
pay. Leave the payment of their just proportion to themfclves ;
this is all that justice requires. In the mean time the proposition
will not reftiain us from availing ourfelvcs of every resource in
our power, and if there ttiould be a balance in our Treasury, after
paying the debts we have already affumcd, we may apply it te
the payment of the debts of the States.
(TO BE CONTINUtD.)
WEDNESDAY, MARCH 10.
The committee to whom was referred the pe
tition ofGifford Dally bro't in a report which was
read, agreed to, and referred to the committee of
appropriations.
The petition of William Bedlow was read the
second time—lt was moved that it be refered to
the Pofi-Mafter-General.
This was objeifled to, as eftablifliing a bad pre
cedent ; it was said tliis is not the only instance
where public money has been made use of, in con -
sequence of which officers in this department have
become delinquent—Congress cannot interfere
in the present cafe but in a due course of law—
and if relief is now granted, the applications will
be numerous ; the course of justice will be diver
ted from its regular channel, and every public
creditor will think himfelf ill used if he should
not be indulged with a suspension of the public
demand again ft him ; fnch indulgences it was
further said, had produced very pernicious ef
fects in some of the States.
In favor of the petitioner it wat said that he had
been unexpectedly difmifled from office, and-that
he was liable to pay a very extra rent in conse
quence of engaging a house in a central situati
on to accommodate the public, in the discharge
of the duties of his office, and that it appeared
reasonable that he ihould have relief in this in-
fiance
The motion for a reference te the Pofi-Mafter-
General, was negatived.
It was then moved that it be referred to a spe
cial committee, which palled in the affirmative;
and Mr. Benfon, Mr. Fitzfimons, and Mr. Ames
were appointed.
The report of the secretary of the department
of war, on the petition of Colonel John Ely, was
read the second time ; this report was in favor
of granting the prayer of the petition ; which
was for coinpenfation for services rendered the
prifonerson Long-Island, in the capacity of fur
geon.—lt was moved that the report fliould be ac
cepted—This was objected to, it was said by Mr.
Livennore, that he did not conceive that the pe
titioner was entitled to pay in the double capa
city of a surgeon and colonel. He received his
pay as an officer in the line of the army, during
his captivity—if he had a profeffion which he
could exercise at that time, he was in a better
situation than many of his fellow prisoners ; and
probably did exercise it to his private emolument,
among the people on the Island : If he had not
been a prisoner, he could not have exercised the
profeffion of a phyllcian and a colonel at the fame
time, and draw pay in both capacities. It would
be eftabliffiing a precedent for others to apply;
and in all probability, every surgeon who wore a
commission, that happened to be taken prisoner,
will set up a similar demand—he was disposed to