gutnent lie liad noticed to the gentleman, (Mr. Ames) —that Great Britain* in the year 1719, might have funk all her debt, but for this very tie, which we were about to inipofe on ourselves. Mr. Madison -could not admit some of the dodtrines of the gentleman, nor some of the con clusions drawn from others. The proposed mo difications, however veiled or varnilhed by our selves, could not be reconciled with the tenor of the public engagements, and mull reft for their juftification with the world on the circumstances of thecountry. The Britilhexample adverted to ■was not applicable. The creditors there, by re fufing to fubfcribeto the new loan, remained in pofleilion of their ftipulatedintereft. It was but to let the tranfaclion speak its true meaning : as it was decided to be the sense of the committee that the public circumstances required that the d;bt should be modified, the only questions left inuft relate to the form and words of the modifi cation to be proposed. He wiflied to Amplify the debt as much as poflible, and should therefore a gree to strike out the clause restraining the right of redemption to the rate of 4 dollars and a frac tion per annum, in order to authorise the govern ment to pay it off at the rate of 10 dollars per annum, as luggefted by another gentleman from Maflachufetts. If this, said he, be done, it wonld be proper to adjnft the sum to be funded at the end of ten years, to the change made in the irre deemable term. The gentleman had drawu a pleasing, and he hoped atrue piifturc of the grow ing prol'perity of this country. But What would result from it > Not that the debt should be per petuated ; but that we should be able to begin a reduction of the principal, and ought not there fore to throw away the right to do 10. • FRIDAY, MARCH 12. In Committee of the whole on the report of the Secretary of the Treasury, for making provision for the support of the public credit. The third proposition was read. Mr. Lee moved that this should be rejected. Mr. Kitzfimons observed that if this is struck out, all idea of offering an alternative to the cre ditors is abandoned—he wished to enquire whe ther that was the inind of the Committee ? For if this is struck out, the creditors must receive the two-thirds, at fix per cent, and the refidueinland. Mr. Lee said, that having made provision for tne debt to the extent of our abilities, he thought there was no obligation to attempt to do more, and being in favor of a fiinple plan of finance, he was opposed to encreafing the propositions on ■which it is to be funded. Mr. Sedgwick obfervedthat to an inhabitant of Virginia, the plan of paying one-third of the debt in lands, was an object of great consequence. But to.those of the Middle and Northern States, this would prove a very inconsiderable induce ment to subscribe to the loans : Upon ternn of justice and equality, he therefore contended that different alternatives ought to be held out to the inhabitants of the United States. Mr. Stone was 111 favor of the motion—he an ticipated foreigners becoming proprietors of our funds, as an evil to be greatly deprecated. The settlement of the Western Territory, byourown citizens is a event, from thisfource we have always expected to derive the means offink ing a great proportion of our debt; and by con lining the creditors to one object, we shall eqilal ly interest .the citizens of all the states. If we hold out different alternatives, we should proba bly deprive ourselves of the advantage of making jale ofanyofour Western Territory. Mr. Sherman was opposed to the motion—he thought it wife andjuft to hold out different pre positions; he differed with Mr. Sedgwick, he thought the lands would be an object with the Isew-England people : 1 hey areaddidied to emi gration as much as any part of the union. He was for shortening the period for redemption ; but hoped that the proposition would not be re jected altogether. Mr. Fiszfimons advocated tlie proposition, and entered into a particular consideration of the au vantages which would result in the present cir eumftatices of the country from foreigners pur chasing otir debt, provided they gave a full equi valent for it. The advantage of the cash which would thereby be brought into the country, would more than counterbalance the payment of interest for many years to come. The motion for rejecting the proposition being put, it was negatived. The question then was on the amendment pro posed by Mr. Jaclcfon for striking out what re lates to irredeemability. Mr. Tucker in a series of calculations upon certain principles attempted to (hew that the ir redeemable 'quality would greatly enhance the debt of the United States. Mr. Lawrance replied to Mr.Tucker,and {hewed that the gentleman's plan would greatly enhance the amount of the debt; whereas the Secretary's report demonstratively provides for leflening it. He agreed with the gentleman from Maryland, that we ought to do the belt for our creditors ; but did not think that making them only one of fer, and that the one already agreed to, was do ing the best wc can. He mentioned the exifling resources of the country, and the obligation we are under to exert ourselves upon that idea. He shewed the advantage of the speculation of fo reigners, and that it ought to be encouraged. Mr. Madison said that foreigners speculating in our funds would induce a spirit ofluxury. That the pernicious consequences of credit had been severely felt; that our experience did not juftify the supposition that an' influx of atflive property, or money would be employed in agricultural im provements. ' He did not think that if a medium to the a mount of one-fourth of the value of all the pro perty of the United States was to be thrown into circulation, that any more land would be culti vated. Mr. Goorlhue said that if by retaining the words, any advantage can be derived, there can be no doubt with gentlemen as to the eligibility of retaining them. He thought it had been de monstrated, that advantages would result from this irredeemable quality. Several other gentlemen spoke on the occa sion—the motion was loft. SATURDAY, MARCH 13 The chairttian of the committee having read the resolve, " that immediate provision ought to be made tor the prclent debt of the United States," &c. Mr. Gerry obterved, that he fbould have risen before this pro portion was read, had he not supposed that the gentleman from Pennsylvania (Mr. Fitzfimons) intended to bring forward his mo tion lor filling up the blanks lett in the last proportion which wa« considered yesterday, and Mr. Fitzfimons informing the com mittee that he propoied to make his motion in the House—Mr. Gerry said thai, as many gentlemen appeared to be fatisfied that the two propositions tor modifying the debt would be accept able to the creditors, and he entertained a different opinion, he hoped for the indulgence of the committee, whilst he submitted his realons for differing from them. He said he considered this part of the Secretary's plan as the most important of the wfiole : it is the elTence of the funding fyftem,the pivot on which will de pend the equilibrium of pu:>lic credit. He had always conceived that public credit was indifpenfible to our national existence, un der any form of government, and being in favor of the Secreta ry's plan in general, he fhouid give it every support in his power ; but not thinking it perfett, he exprelTcd a wiih that its defc&s might be cured. "1 he Secretary* said Mr. Gerry* lays it down as a maxim, and I think it cannot be contcited, " that the maintenance of public credit can only be effected bv good faith, and a pun£lual perfor mance of contrails." Let us enquire what is the existing contrail between the United States and their creditors, in what manner it , has been complied with, and how far it is now in the power of Congrcfs to do them justice. 1 fje contrail, he said, it is well known, is to pay the principal of the debt in fpccie, with an interell till paid of 6 per cent per annum. The principal indeed, of part of the debt, being payable in three years after it was contrailed, is now due ; but this class of the creditors will probably be fatisfied with the provilion to be made for the others. And in what manner, said he, has the contra# been complied with ? A small part of the interest has been paid by bills of ex change on France, and the rcfidue has been paid in depreciated paper, or is now due to the creditors. He then enquired, how far it is in the power of Congress to do juliice to the creditors ? This point, he said, had never been as certained ; but we now intend to propose to the fubferibing cre ditors, to fund two thirds of their debt at 6 percent, redeemable at the pleasure of Congress, and to pay the other third in western lands ; or tofund two-thirds at 6 per cent, irredeemable in a sti pulated degree, and to fund in ten years a sum not yet ascertained as an equivalent. The lurplus of the funds, if auy, is to be ap plied to the payment of the interest due to non-ftibfcribers, so as not to exceed 4 per cent, agreeably to the proposition of the Se cretary. Is this securing, or is it doing all we can to secure to the creditors a compliance with the terms of the contraa ? I con ceive it is neither. ( That the propositionS do not secure such a compliance is evi dent at firft blush ; for who would give as much for 100 dollars, two-thirdsof which shall be funded in one of the modes propo sed, and the other third payable in lands, or in an equivalent to be funded ten years hence, as for 100 dollais funded at fix per cent, per anhum, and redeemable at the pleasure of Congress ? No man of common understanding, as I think will hereafter appear. That the making such proposals is not doing all we can to se cure such a compliance, is, I| think, equally evident. Some gentlemen have declared* that they have no idea* of the ab.l.ty of government to fulfil the contraa ; and that the creditors have abandoned an eXpeaation of receiving either the whole of the principal or of the interest that is due to them. What evi dence have we of this ? If we may judge from the justice of their claims, Irom their urgency and impatience, and from the petitions of the creditors, they expect the whole of their principal and in tcreft : but if thev do not, is it not evident that they must con the nat,on ,ri a ft»te of bankruptcy ? And is it not our duty to convince them, and all the world, of our abil.ty and difpofi- to pay our debts, by doing the ftriaeft justice to our crc- If gentlemen have no idea of the ability of government to do this, they mull either despair of resources, or of the support of the people,n drawing them forth: and if the former, is it not our du ty, and will it not be more honorable to apply the resources as far as they will go to the dilchacgc of the debt, and to depend on our increasing population, commerce, husbandry and manufactures, Jiid also on the western territory, for an encrcafe of means, rather than to declare a national bankruptcy ? This, like Pandora's box wou dbe pregnant with every evil; it would shake the govern tnt to the foundation, and endanger our national independence. But why, it they despair of resources, do gentlemen resolve to make adequate provision for fulfilling our engagements with fo eigners ? Are, we, in cases of exigency, to rell the support of our government on foreigners, or on our own citizens ? If on the lat !'"! l, ' y evcr tr " ll , us ast « f"ch partially to foreigners ? Are ot the debts contrasted with our citizens as juflly due as ihofe of the other description ? If we a,e to make a discrimination, ought it not, on principles of policy, to be in favor of our citizens i> May no our national exiftcnce depend on our credit with them ? I am not, however, in any event, for making such , diftinftion ; for, in cafe nf a bankruptcy, I (hould be in favor of equ*uftice io every inr ! ° r ' 7 X thls f dc( P™dency ? Shall we ™t, by defpair en'a v?' e " n ° Ur '° su P credit, ma- Sl, II we nTh f censured for want of firmnefs?, mn T, ; rfpo ," f ' blt ' for hav,n S thus despaired of the Com monwealth, and, what is worCe, for having despaired without Have we atlonded to our resources ? Have we an adequate idea repouTt' ajtea and unliquidated, 406 For the interest of the foreign debt, !' For the interest of the domestic debt, if paid, M 5 »599 »6 according to the contn&, . „ For the civil lift, and other expences of go- l i vernment, The revenue reported in his firft eftimateis, In his lad estimate, Making 3,903,400 n hich leaves a deficiency of 1,284,044 dollars, and 81 cents, s O , funding the whole debt accordingto contract.* j Tlie Secretary has likewise sported that he has additional re sources, without extending taxation to lioul'es or lands, or the st oc k or produce of farms ; and we have no reason to suppose that thole additional rciourccs would not be adequate to the making uothi* deficiency. Butifthisisnottliecafe.it is well known, that in consequence of the propositions o! Congress, in April i ; 8, m 'a„ v of the States divelted, as they confentcd to be, of the itnpJlt and loaded .vith State debts,far exceeding iheirprefent amount agreed to provide annually their refpeftive proportions of what weri cal led the fupplementarv funds, amounting to 1,500,000 dollars an! can any one doubt that, exonerated as the States will now be of their debts, the citizens of the United States in their present cir cumllances, can with much more ease, pay the deficiency men tioned, than they could at that|period the supplementary funds?— Indeed, can any one doubt our ability »t this time to fund the na tional debt, according to the (lipulated terms of the contrail ? If there are any such, I confefs myfelfnot of the number. It is said we mud have in reserve resources in cafe of exigencies : This may be proper; but is not the support of public credit of the greatest moment ? May not the lols of it prove an irreparable in, jury ? And arc we to incur a certain evil to avoid an uncertain one ? • If our resources then are not to be doubted, what reason have wo to diftrult thefupport of our constituents ? Should it be Welled in our hearing that they were indisposed to pay a debt, that had not only a claim 011 their juflice, but on their honor and generofitv a debt that is the price of their independence, lhould we not kin! die with indignation ? And (hall we, by an unreafonablediftiulf be the firft to fix such a (ligma on our constituents ? Or, conduct* ing thus, (hall we not justly mrrit their refentmcnt { Hit be aftcd what (hall we do to fulfill, as far as poflible, our contrast > I an f. wer, wc ought not to oblige the creditois to lake two-thirds of their demands in funded ficuruies, and the other third in wild finds, or in what you mav call ail equivalent, ten yeart hence • or to receive the alternative provided tor the unfubfcribed debt ' A great part of the debt is still in the hands of the original holder! to do justice to whom the committee are unanimous in theirwilh" cs. If we suppose ten millions dollars in the hands of specula" tors,the value thereof will,at the late average rate of (locks, amount to between three 01 four millions dollars in specie, a fnm I con ceive, exceeding the property of the fpcculators altogether • but suppose they hold 1 5 millions dollars, foreigners s millions, and the States, cxclufive of Pennsylvania, 3or 4 millions (for that State, having exenanged her funded certificates for continental fecuritiea, which were generally owned by original holders, must according to the Secretary's plan, deliver them into the federal trcafury, or re-exchange them) it is evident then that two-thirds 01 the public debt is in the hands of original holders : Let us how ever suppose but half, will many of them be willing, or, if willing be able to receive lands for a third of their debts ? If the lands were cultivated and near them, would they be equal to an'intereft of 6 per cent, or of more than 4 per cent, except perhaps in foms ot the Southern States ? And would they be difpoled to accept of your proposal ? But remote asthefe lands are,inve(led by hostile Indian;, wild and uncultivated, will they furnifhfood orcloath ing (or your creditors ? Should a few purchase, will they not be comparatively very few. Again, Will funding an equivalent for one third ten vearshence, be tulhling the contraa ? After being ten or fifteen years put off With promtfes, will the creditors be thus fatisfied ? Will it be in their power-advanced as many of them are in years, »nd called on, perhaps, by their own creditors, whom your disappointments have prevented them from paying to acc«pt such terms ? Suppose an individual had trusted an other for fucfi a term of years, and at the end thereof, when the latter was in podeffion of hiseftate, had fen told, that twt> thirds of the interest (hould be annually paid £ and that the other third, or an equivalent (hould be paid in ten years: would the proposal cftablifti the credit of the debtor? Or would he not be conftdered as a person deftituteof honelly ? How then can we expefl, merely by such proposals, to cftablifh the pub liC.crcdit ? r ' r Gentlemen conceive that the proposition, referred to will be an equivalent, on the principle laid down by the Secretary, viz. that 1 e s capital at a fixed rate of inter eft, may bean equivalent for a Q reater capital at a variable rate : but admitting this principle, are not t e d ata doubtful on which the calculations are made, that in ere in five years will fall to 5 per cent, and in 20 years to 4 ? rIS e , s own that thc genius of oi|-r fellow-citirens is enter pri ing r* \\e lee them, although we have wild lands exceeding ill extent the German dominion, crofting the Miffifippi to speculate in lands in the Spanilh dominions : we fee them extending their commercial ipeculati6ns to the North pole, and they will go to the out i "ole on the firftdifcovery of a commercial territory ; inour un s, they speculate deeply and they are as conspicuous for their 'peculations 111 forms of government. Scarcely a year revolves, without our feeing some of the States, or the United States, adopt ing a new system of government; and, before 20 years shall c aP c , we expect that the latter, in their turn, will form one or two constitutions. We are also, like other nations, fubjeft to foreign wars and internal commotions : these, and such like events, are eyond our controul ; and, whenever they take place, will en crea e the rates of interfft. The probability is not therefore not more in favor of the fall than of the rife of interest : and if it iou d not fall, the proposition to be made will injure the credit -01 s. I conceive, then, that we have no more right to assume the principle that interest will fall, and by afiuming it, to reduce the interest, than the creditors whose principal is due have a right to a ume the contrary principle, in order to increase the rates of in -Ire t. The faireft way is to presume that the interest will conti nue at the rate it now is, and whenever it falls, to take the bene totit so far as shall be confident with justice. Few of the cre itors understand the calculation of equivalents, and will be apt t® con 'der them as a State artifice to reduce the value of flocks: they will be confirmed in this opinion, however honest our intentions may be, by the disposition we are making to purchase the debt at tie maiket price. We have no right to make arrangements of this 'ind, until the whole debt is fairly funded ; and then, if we have unds left, we shall have a right to apply them in the way men- Some gentlemen have ftipofed that 66 and two-thirds of dollars in ten years hence, may be worth 100 dollars: but this fuppofitr on does not establish thefaa. The rife and fall of stocks, depend on events, these may reduce the sum firft mentioned to 33 and one third dollars. If, then, the two proportions which have bden examined do not Ul ? a com p l ' anc e with the original contrast, will the alternative which is left for non-fubferibers ? This provides that the dregs of the revenue, which may amount to nothing, ih all be applied to pay their interest, not to exceed, in any event, 4 per cent, per an num. Will not this, in lieu of an equitable provision for the cre ditors, be considered x a penalty for their not fubferibing. Mr. Gerry then said, he presumed it must appear that further provision is necelTary, and he should offer a proposition, as an ad dition to the two,that are adopted irf the words following: 600,000 T « a '. 5,'87, 444 »i *>843,000 , 1,060,000
Significant historical Pennsylvania newspapers