A gentleman from Pennsylvania (Mr. HARTLEY) has noticed my arguments of

yesterday, respecting a funding system. I beg leave to make a few

observations in answer to him. He has said, that a funded debt is of

great advantage to a nation, and has adduced the situation of England as

a proof, founded on experience. But England is a solitary example, and

the force of that example dwindles into nothing, if we examine into the

real cause of her seeming affluence. She does not owe much of

respectability to her national debt; she owes the most of it, at

present, to the troubles of other countries, and when those have

subsided, the bubble of her credit may blow up, as did the South Sea

project, for Government stock can never be considered as cash. The stock

employed in agriculture, commerce, and manufactures may, by great

prospects of advantage, be diverted into the hands of brokers, for the

purpose of speculating further in the funds; but no real addition will

be made to the means of productive industry, nor was any thing of this

kind contemplated at the time funding was first introduced into England.

We learn from _Blackstone_, that the reason for establishing a national

debt, was in order to support a system of foreign politics, and to

establish the new succession at the revolution; because it was deemed

expedient to create a new interest, called the moneyed interest, in

favor of the Prince of Orange, in opposition to the landed interest,

which was supposed to be generally in favor of the king, who had

abdicated the throne. I hope there is no such reason existing here; our

Government, I trust, is firmly established without the assistance of

stock-jobbers. We ought to reign universally in the hearts of our

fellow-citizens, on account of the salutary tendency of our measures to

promote the general welfare, and not depend upon the support of a party,

who have no other cause to esteem us but because we realize their golden

dreams of unlooked-for success.

Mr. SMITH, (of South Carolina.)--If we were about to contract debts for

the purpose of funding them, the observations of the gentleman from

Georgia would apply; but we have already contracted them, and the only

question is, shall we fund or pay? We must do one or the other. With

respect to the remark of Blackstone, he is writing of an enormous public

debt when he mentions it as injurious, because he expressly says, that

"a certain proportion of debt seems to be highly useful to a trading

people; but what proportion that is it is not for me to determine." To

be sure he adds afterwards, "that the present magnitude of our national

encumbrances very far exceeds all calculations of commercial benefit,

and is productive of the greatest inconveniences." And here I agree with

him: but our public debt is not of such enormous magnitude as to

counterbalance the good effects of throwing out such a quantity of a

stable paper as will answer all the purposes of a circulating medium.

Mr. TUCKER.--I very much applaud the gentleman who made the motion now

before the committee, because he has boldly come forward to combat an

opinion so generally received in this place, that many thought it could

not be controverted by any man possessed of common honesty; and because

I am persuaded, that he has done it with an honorable intention of

substituting real and substantial justice, in the place of that which he

deems to be only the name and the shadow.

Although it is probable I differ with the gentleman who moved the

amendment, I am inclined to think a discrimination of some kind is

equitable and necessary. I believe it may be fairly said, that there are

three classes of domestic creditors. The first, those who hold the

Continental bills of credit, which have been long out of circulation.

Second, those who hold certificates that were given for services or

supplies, in their own names. And, third, those who hold certificates by

purchase. I would wish to consider the obligation to each of these three

classes, and whether, in equity, some kind of discrimination may not be

made. On a strict and impartial examination, I am inclined to believe

they will not appear to be the same. I will now turn to the examination

of the first; namely, the holders of the Continental bills of credit.

The Secretary of the Treasury has reported in favor of some degree of

provision being made for them. But, sir, what is the situation of the

people who hold these bills? If I recollect rightly, the face of the

bills declares, that the bearer shall be entitled to receive so many

Spanish milled dollars as is therein expressed. When these bills were

issued, their real value was equal to their nominal value; no person

refused, or wished to refuse, them as such; but, in a short time, too

large a quantity were issued, and they began to depreciate. Congress

then recommended to the several States to pass tender-laws for the

support of their credit. This was done by all the States; and they

continued, in some of them, to pass as specie, under those laws, when

they were depreciated twenty, thirty, and forty for one. Those people,

who received them in this state, suffered a very great loss by an act of

the Government, and many were ruined by the measure. When these bills

had thus depreciated, Congress passed a resolution, calling them in at

forty for one. This ordinance of Congress immediately reduced the claims

of the first class of creditors by an arbitrary act of power. I do not

pretend to say that the measure was unnecessary, but it was rigorous to

deprive them of 39-40ths of their claims. Perhaps we cannot return to

all the transactions of that time, because it would involve the

Government in a thousand difficulties, and produce, perhaps, greater

evils than it would remedy. But there remains a claim upon our justice

to pay the holders one dollar, at least, for forty. By the act of

Congress, which I alluded to before, these bills were thrown out of

circulation, and have ever since lain in the hands of individuals. Now,

it appears to me, that, in equity, we ought to make all the reparation

in our power. Surely, then, we ought to allow interest on the principal

from the time the bills were scaled, and forced out of circulation.

These creditors, I take it, have a strong claim upon us; because the

Government has materially injured them, and the least satisfaction we

can give them, is to put this part of the debt on the best footing we

can; if we cannot do complete justice, let us approximate towards it as

far as it is in our power. The second class of our creditors have

obligations that are strong. It has been said, and generally passed

current as an incontrovertible opinion, that those who transferred their

certificates have conferred to the purchaser every claim they had upon

the public. I mean, sir, to deny this assertion. There is a claim which

they could not transfer, that is, a claim in equity;, they were entitled

to the principal sum when they presented their accounts to the United

States, and we ought, in justice, to have paid it at that time; but,

perhaps, from our inability to do this, we were obliged to force on them

a certificate of the balance, with a promise to pay them an annual

interest thereon; but a promise to pay the interest does not exonerate

us from paying the principal, as soon as we have it in our power. Now,

this is a claim which the original creditor, who parted with the

evidence of his debt, did not transfer to the person to whom he sold it.

The United States are under no contract with the purchaser who bought a

loaned debt, to pay him any thing more than what the paper specifies,

that is, to pay him the interest from year to year, but not the

principal, until we find it convenient.

Then, with respect to the third class, if the residue of the revenue is

insufficient to pay them the interest on their whole principal, I would

give them certificates for such part as we are able to provide for the

payment of the interest upon, at six per cent., to be paid in the same

manner with the others. And I would give them other certificates for the

remainder, on a like interest of six per cent., the payment whereof

should commence at a fixed period, say three, four, or five years, as it

might be found that the increasing resources of our country would,

enable us to do; but I would undertake nothing now beyond our present

ability.

THURSDAY, February 11.

[Mr. FITZSIMONS presented the address of the yearly (Quaker) meeting of

Pennsylvania, New Jersey, Delaware, and the Western parts of Maryland

and Virginia, held at Philadelphia, against the continuance of the

African slave trade, and praying Congress to remove that reproach from

the land, and Mr. LAWRENCE presented an Address to the same effect from

the Society of Friends in New York.]

Mr. HARTLEY moved to refer the Address of the annual assembly of

Friends, held at Philadelphia, to a committee; he thought it a mark of

respect due to so numerous and respectable a part of the community.

Mr. WHITE seconded the motion.

Mr. SMITH (of S. C.)--However respectable the petitioners may be, I hope

gentlemen will consider that others equally respectable are opposed to

the object which is aimed at, and are entitled to an opportunity of

being heard before the question is determined. I flatter myself

gentlemen will not press the point of commitment to-day, it being

contrary to our usual mode of procedure.

Mr. FITZSIMONS.--If we were now to determine the final question, the

observation of the gentleman from South Carolina would apply; but, sir,

the present question does not touch upon the merits of the case; it is

merely to refer the memorial to a committee, to consider what is proper

to be done; gentlemen, therefore, who do not mean to oppose the

commitment to-morrow, may as well agree to it to-day, because it will

tend to save the time of the House.

Mr. JACKSON wished to know why the second reading was to be contended

for to-day, when it was diverting the attention of the members from the

great object that was before the Committee of the Whole? Is it because

the feelings of the Friends will be hurt to have their affair conducted

in the usual course of business? Gentlemen, who advocate the second

reading to-day, should respect the feelings of the members who represent

that part of the Union which is principally affected by the measure. I

believe, sir, that the latter class consists of as useful and as good

citizens as the petitioners, men equally friends to the revolution, and

equally susceptible of the refined sensations of humanity and

benevolence. Why, then, should such particular attention be paid to

them, for bringing forward a business of questionable policy? If

Congress are disposed to interfere in the importation of slaves, they

can take the subject up without advisers, because the constitution

expressly mentions all the power they can exercise on the subject.

Mr. SHERMAN suggested the idea of referring it to a committee, to

consist of a member from each State, because several States had already

made some regulations on this subject. The sooner the subject was taken

up he thought it would be the better.

Mr. PARKER.--I hope, Mr. Speaker, the petition of these respectable

people will be attended to with all the readiness the importance of its

object demands; and I cannot help expressing the pleasure I feel in

finding so considerable a part of the community attending to matters of

such momentous concern to the future prosperity and happiness of the

people of America. I think it my duty, as a citizen of the Union, to

espouse their cause; and it is incumbent upon every member of this House

to sift the subject well, and ascertain what can be done to restrain a

practice so nefarious. The constitution has authorized us to levy a tax

upon the importation of such persons as the States shall authorize to be

admitted. I would willingly go to that extent; and if any thing further

can be devised to discountenance the trade, consistent with the terms of

the constitution, I shall cheerfully give it my assent and support.

Mr. MADISON.--The gentleman from Pennsylvania (Mr. FITZSIMONS) has put

this question on its proper ground; if gentlemen do not mean to oppose

the commitment to-morrow, they may as well acquiesce in it to-day; and,

I apprehend, gentlemen need not be alarmed at any measure it is likely

Congress will take; because they will recollect, that the constitution

secures to the individual States the right of admitting, if they think

proper, the importation of slaves into their own territory, for

eighteen years yet unexpired; subject, however, to a tax, if Congress

are disposed to impose it, of not more than ten dollars on each person.

The petition, if I mistake not, speaks of artifices used by

self-interested persons to carry on this trade; and the petition from

New York states a case that may require the consideration of Congress.

If any thing is within the Federal authority to restrain such violation

of the rights of nations and of mankind, as is supposed to be practised

in some parts of the United States, it will certainly tend to the

interest and honor of the community to attempt a remedy, and is a proper

subject for our discussion. It may be, that foreigners take the

advantage of the liberty afforded them by the American trade, to employ

our shipping in the slave trade between Africa and the West Indies, when

they are restrained from employing their own by restrictive laws of

their nation. If this is the case, is there any person of humanity that

would not wish to prevent them? Another consideration why we should

commit the petition is, that we may give no ground of alarm by a serious

opposition, as if we were about to take measures that were

unconstitutional.

Mr. _Stone_ feared that if Congress took any measures indicative of an

intention to interfere with the kind of property alluded to, it would

sink it in value very considerably, and might be injurious to a great

number of the citizens, particularly in the Southern States. He thought

the subject was of general concern, and that the petitioners had no more

right to interfere with it than any other members of the community. It

was an unfortunate circumstance, that it was the disposition of

religious sects to imagine they understood the rights of human nature

better than all the world besides; and that they would, in consequence,

be meddling with concerns in which they had nothing to do. As the

petition relates to a subject of a general nature, it ought to lie on

the table as information. He would never consent to refer petitions,

unless the petitioners were exclusively interested. Suppose there was a

petition to come before us from a society, praying us to be honest in

our transactions, or that we should administer the constitution

according to its intent, what would you do with a petition of this kind?

Certainly it would remain on your table. He would, however, not have it

supposed that the people had not a right to advise and give their

opinion upon public measures; but he would not be influenced by that

advice or opinion to take up a subject sooner than the convenience of

other business would admit. Unless he changed his sentiments, he would

oppose the commitment.

Mr. BURKE thought gentlemen were paying attention to what did not

deserve it. The men in the gallery had come here to meddle in a business

with which they have nothing to do; they were volunteering in the cause

of others, who neither expected nor desired it. He had a respect for the

body of Quakers, but, nevertheless, he did not believe they had more

virtue or religion than other people, nor perhaps so much, if they were

examined to the bottom, notwithstanding their outward pretences. If

their petition is to be noticed, Congress ought to wait till counter

applications were made, and then they might have the subject more fairly

before them. The rights of the Southern States ought not to be

threatened, and their property endangered, to please people who would be

unaffected by the consequences.

Mr. HARTLEY thought the memorialists did not deserve to be aspersed for

their conduct, if influenced by motives of benignity. They solicited the

Legislature of the Union, to prevent, as far as is in their power, the

increase of a licentious traffic; nor do they merit censure, because

their behavior has the appearance of more morality than other people.

Congress ought not to refuse to hear the applications of their

fellow-citizens, while those applications contain nothing

unconstitutional or offensive. What is the object of the address before

us? It is intended to bring before this House a subject of great

importance to the cause of humanity; there are certain facts to be

inquired into, and the memorialists are ready to give all the

information in their power; they are waiting, at a great distance from

their homes, and wish to return; if, then, it will be proper to commit

the petition to-morrow, it will be equally proper to-day, for it is

conformable to our practice; besides, it will tend to their conveniency.

Mr. LAWRENCE.--The gentleman from South Carolina says, the petitioners

are of a society not known in the laws or constitution. Sir, in all our

acts, as well as in the constitution, we have noticed this society; or,

why is it that we admit them to affirm in cases where others are called

upon to swear? If we pay this attention to them, in one instance, what

good reason is there for contemning them in another? I think the

gentleman from Maryland (Mr. STONE) carries his apprehensions too far,

when he fears that negro property will fall in value, by the suppression

of the slave trade; not that I suppose it immediately in the power of

Congress to abolish a traffic which is a disgrace to human nature; but

it appears to me, that, if the importation was crushed, the value of a

slave would be increased instead of diminished; however, considerations

of this kind have nothing to do with the present question. Gentlemen may

acquiesce in the commitment of the memorial, without pledging themselves

to support its object.

Mr. JACKSON.--I differ much in opinion with the gentleman last up. I

apprehend, if through the interference of the General Government the

slave trade was abolished, it would evince to the people a disposition

towards a total emancipation, and they would hold their property in

jeopardy. Any extraordinary attention of Congress to this petition may

have, in some degree, a similar effect. I would beg to ask those, then,

who are desirous of freeing the negroes, if they have funds sufficient

to pay for them? If they have, they may come forward on that business

with some propriety; but, if they have not, they should keep themselves

quiet, and not interfere with a business in which they are not

interested. They may as well come forward and solicit Congress to

interdict the West India trade, because it is injurious to the morals of

mankind; from thence we import rum, which has a debasing influence upon

the consumer. But, sir, is the whole morality of the United States

confined to the Quakers? Are they the only people whose feelings are to

be consulted on this occasion? Is it to them we owe our present

happiness? Was it they who formed the constitution? Did they, by their

arms or contributions, establish our independence? I believe they were

generally opposed to that measure: why, then, on their application,

should we injure men who, at the risk of their lives and fortunes,

secured to the community their liberty and property? If Congress pay any

uncommon degree of attention to their petition, it will furnish just

ground of alarm to the Southern States. But why do these men set

themselves up in such a particular manner against slavery? Do they

understand the rights of mankind, and the disposition of Providence,

better than others? If they were to consult that book, which claims our

regard, they will find that slavery is not only allowed but commended.

Their Saviour, who possessed more benevolence and commiseration than

they pretend to, has allowed of it: and if they fully examine the

subject, they will find that slavery has been no novel doctrine since

the days of Cain; but be these things as they may, I hope the House will

order the petition to lie on the table, in order to prevent an alarm to

our Southern brethren.

Mr. SEDGWICK.--If it was a serious question whether the memorial should

be committed or not, I would not urge it at this time; but that cannot

be a question for a moment, if we consider our relative situation with

the people. A number of men, who are certainly very respectable, and of

whom, as a society, it may be said with truth, that they conform their

moral conduct to their religious tenets, as much as any people in the

whole community, come forward and tell you, that you may effect two

objects by the exercise of a constitutional authority, which will give

great satisfaction. On the one hand, you may acquire revenue, and on the

other, restrain a practice productive of great evil. Now, setting aside

the religious motives which influence their application, have they not a

right as citizens to give their opinion of public measures? For my part,

I do not apprehend that any State, or any considerable number of

individuals in any State, will be seriously alarmed at the commitment of

the petition, from a fear that Congress intend to exercise an

unconstitutional authority, in order to violate their rights. I believe

there is not a wish of the kind entertained by any member of this body;

how can gentlemen hesitate, then, to pay that respect to a memorial

which it is entitled to, according to the ordinary mode of procedure in

business? Why shall we defer doing that till to-morrow, which we can do

to-day; for the result, I apprehend, will be the same in either case.

Mr. SMITH, (of South Carolina.)--The question, I apprehend, is whether

we will take the petition up for a second reading, and not whether it

shall be committed? Now, I oppose this, because it is contrary to our

usual practice, and does not allow gentlemen time to consider of the

merits of the prayer. Perhaps some gentlemen may think it improper to

commit it to so large a committee as has been mentioned; a variety of

causes may be supposed to show that such a hasty decision is improper;

perhaps the prayer of it is improper. If I understood it right on its

first reading, though to be sure I did not comprehend perfectly all that

the petition contained, it prays that we should take measures for the

abolition of the slave trade. This is desiring an unconstitutional act,

because the constitution secures that trade to the States, independent

of Congressional restrictions, for a term of twenty-one years. If,

therefore, it prays for a violation of constitutional rights, it ought

to be rejected as an attempt upon the virtue and patriotism of the

House.

Mr. BOUDINOT.--It has been said, that the Quakers have no right to

interfere in this business. I am surprised to hear this doctrine

advanced, after it has been so lately contended and settled, that the

people have a right to assemble and petition for redress of grievances.

It is not because the petition comes from the society of Quakers that I

am in favor of the commitment, but because it comes from citizens of the

United States who are equally concerned in the welfare and happiness of

their country with others. There certainly is no foundation for the

apprehensions which seem to prevail in gentlemen's minds. If the

petitioners were so uninformed as to suppose that Congress could be

guilty of a violation of the constitution, yet I trust we know our duty

better than to be led astray by an application from any man or set of

men whatever. I do not consider the merits of the main question to be

before us; it will be time enough to give our opinions upon that when

the committee have reported. If it is in our power, by recommendation,

or any other way, to put a stop to the slave trade in America, I do not

doubt of its policy; but how far the constitution will authorize us to

attempt to depress it, will be a question well worthy of our

consideration.

Mr. SHERMAN observed, that the petitioners from New York stated, that

they had applied to the Legislature of that State to prohibit certain

practices which they conceived to be improper, and which tended to

injure the well-being of the community; that the Legislature had

considered the application, but had applied no remedy, because they

supposed that power was exclusively vested in the General Government

under the Constitution of the United States; it would, therefore, be

proper to commit that petition, in order to ascertain what are the

powers of the General Government in the case.

Mr. GERRY thought gentlemen were out of order in entering upon the

merits of the main question at this time, when they were considering the

expediency of committing the petition. He should, therefore, not follow

them further in that track than barely to observe, that it was the right

of the citizens to apply for redress, in every case in which they

conceived themselves aggrieved; and it was the duty of Congress to

afford redress as far as in their power. That their Southern brethren

had been betrayed into the slave trade by the first settlers, was to be

lamented; they were not to be reflected on for not viewing this subject

in a different light, the prejudice of education is eradicated with

difficulty; but he thought nothing would excuse the General Government

for not exerting itself to prevent, as far as they constitutionally

could, the evils resulting from such enormities as were alluded to by

the petitioners; and the same considerations induced him highly to

commend the part the Society of Friends had taken; it was the cause of

humanity they had interested themselves in, and he wished, with them, to

see measures pursued by every nation, to wipe off the indelible stain

which the slave trade had brought upon all who were concerned in it.

Mr. MADISON thought the question before the committee was no otherwise

important than as gentlemen made it so by their serious opposition. Had

they permitted the commitment of the memorial, as a matter of course, no

notice would have been taken of it out of doors; it could never have

been blown up into a decision of the question respecting the

discouragement of the African slave-trade, nor alarm the owners with an

apprehension that the General Government were about to abolish slavery

in all the States; such things are not contemplated by any gentleman;

but they excite alarm by their extended objections to committing the

memorials. Gentlemen may vote for the commitment of the petition without

any intention of supporting the prayer of it.

Mr. WHITE would not have seconded the motion, if he had thought it would

have brought on a lengthy debate. He conceived that a business of this

kind ought to be decided without much discussion; it had constantly been

the practice of the House, and he did not suppose there was any reason

for a deviation.

Mr. PAGE said, if the memorial had been presented by any individual,

instead of the respectable body from whom it emanated, he should have

voted in favor of a commitment, because it was the duty of the

Legislature to attend to subjects brought before them by their

constituents; if, upon inquiry, it was discovered to be improper to

comply with the prayer of the petitioners, he would say so, and they

would be satisfied.

Mr. STONE thought the business ought to be left to take its usual

course; by the rules of the House, it was expressly declared that

petitions, memorials, and other papers, addressed to the House should

not be debated or decided on the day they were first read.

Mr. BALDWIN felt at a loss to account why precipitation was used on this

occasion, contrary to the customary usage of the House. He had not heard

a single reason advanced in favor of it. To be sure it was said the

petitioners are a respectable body of men; he did not deny it; but

certainly gentlemen did not suppose they were paying respect to them or

to the House, when they urged such a hasty procedure. It was contrary to

his idea of respect, and the idea the House had always expressed, when

they had important subjects under consideration; and, therefore, he

should be against the motion. He was afraid that there was really a

little volunteering in this business, as it had been termed by the

gentleman from Georgia.

Mr. HUNTINGTON considered the petitioners as much disinterested as any

persons in the United States; he was persuaded they had an aversion to

slavery, yet they were not singular in this; others had the same; and he

hoped, when Congress took up the subject, they would go as far as

possible to prohibit the evil complained of. But he thought that would

be better done by considering it in the light of revenue; when the

Committee of the Whole on questions of finance might properly take the

subject into consideration, without giving any ground for alarm.

Mr. TUCKER.--I have no doubt on my mind respecting what ought to be done

on this occasion; so far from committing the memorial, we ought to

dismiss it without further notice. What is the purport of the memorial?

It is plainly this, to reprobate a particular kind of commerce, in a

moral point of view, and to request the interposition of Congress to

effect its abrogation. But Congress has no authority, under the

constitution, to do more than lay a duty of ten dollars upon each person

imported; and this is a political consideration, not arising from either

religion or morality, and is the only principle upon which we can

proceed to take it up. But what effect do these men suppose will arise

from their exertions? Will a duty of ten dollars diminish the

importation? Will the treatment be better than usual? I apprehend not;

nay, it may be worse, because an interference with the subject may

excite a great degree of restlessness in the minds of those it is

intended to serve, and that may be a cause for the masters to use more

rigor towards them than they would otherwise exert: so that these men

seem to overshoot their object. But if they will endeavor to procure the

abolition of the slave trade, let them prefer their petitions to the

State Legislatures, who alone have the power of forbidding the

importation. I believe their applications there would be improper; but

if they are any where proper, it is there. I look upon the address then

to be ill-judged, however good the intention of the framers.

Mr. SMITH claimed it as a right that the petition should lie over till

to-morrow.

THURSDAY, February 11.

_Assumption of State Debts._

[Mr. MADISON's motion to discriminate between original

creditors and present holders, so as to pay claims in full

to the former, and the highest market price to the

assignee, and the remainder to the original creditor.]

The House then again resolved itself into a Committee of the Whole upon

the report of the Secretary of the Treasury, Mr. BALDWIN in the chair.

Mr. BURKE's amendment being under consideration,

Mr. BURKE said, he had brought his motion forward, in consequence of a

hasty promise he had given a member of this House; but as he did not

mean to support it, or vote for it, he would withdraw it.

Mr. MADISON.--No gentleman, Mr. Chairman, has expressed more strongly

than I feel, the importance and difficulty of the subject before us.

Although I have endeavored to view it under all its aspects, and analyze

it in all its principles, yet have I kept my mind open, and been anxious

to aid my own reflections by the reflected light to be expected from

gentlemen on this floor who enter into the discussion. For this purpose,

I have chosen hitherto rather to be a hearer than a speaker on the

subject, and should even at this moment have continued in my seat, but

that the turn which the business has taken, renders it requisite for me

now, if at all, to trouble the committee with my reflections, and the

opinion in which they have terminated.

It has been said, by some gentlemen, that the debt itself does not exist

in the extent and form which is generally supposed. I confess, sir, I

differ altogether from the gentleman who takes that ground. Let us

consider, first, by whom the debt was contracted, and then let us

consider to whom it is due. The debt was contracted by the United

States, who, with respect to that particular transaction, were in a

national capacity. The Government was nothing more than the agent or

organ, by which the whole body of the people acted. The change in the

Government which has taken place has enlarged its national capacity, but

it has not varied the national obligation, with respect to the

engagements entered into by that transaction. For, in like manner, the

present Government is nothing more than the organ, or agent, of the

public. The obligation which they are under, is precisely the same with

that under which the debt was contracted; although the Government has

been changed, the nation remains the same. There is no change in our

political duty, nor in the moral or political obligation. The language I

now use, sir, is the language of the constitution itself; it declares

that all debts shall have the same validity against the United States,

under the new, as under the old form of Government. The obligation

remains the same, though I hope experience will prove that the ability

has been favorably varied.

The next question is, to what amount the public are at present indebted?

I conceive the question may be answered in a few words. The United

States owe the value they received, which they acknowledge, and which

they have promised to pay: what is that value? It is a certain sum in

principal, bearing an interest of six per cent. No logic, no magic, in

my opinion, can diminish the force of the obligation.

The only point on which we can deliberate is, to whom the payment is

really due; for this purpose, it will be proper to take notice of the

several descriptions of people who are creditors of the Union, and lay

down some principles respecting them, which may lead us to a just and

equitable decision. As there is a small part of the debt yet

unliquidated, it may be well to pass it by and come to the great mass of

the liquidated debt. It may here be proper to notice four classes into

which it may be divided:

_First_, Original creditors, who have never alienated their

securities.

_Second_, Original creditors who have alienated.

_Third_, Present holders of alienated securities.

_Fourth_, Intermediate holders, through whose hands

securities have circulated.

The only principles that can govern the decision on their respective

pretensions, I take to be, 1. Public Justice; 2. Public Faith; 3. Public

Credit; 4. Public Opinion.

With respect to the first class, there can be no difficulty. Justice is

in their favor, for they have advanced the value which they claim;

public faith is in their favor, for the written promise is in their

hands; respect for public credit is in their favor, for if claims so

sacred are violated, all confidence must be at an end; public opinion is

in their favor, for every honest citizen cannot but be their advocate.

With respect to the last class, the intermediate holders, their

pretensions, if they have any, will lead us into a labyrinth, for which

it is impossible to find a clew. This will be the less complained of,

because this class were perfectly free, both in becoming and ceasing to

be creditors; and because, in general, they must have gained by their

speculations.

The only rival pretensions, then, are those of the original creditors,

who have assigned, and of the present holders of the assignments.

The former may appeal to justice, because the value of the money, the

service, or the property advanced by them, has never been really paid

to them.

They may appeal to good faith, because the value stipulated and

expected, is not satisfied by the steps taken by the Government. The

certificates put into the hands of the creditors, on closing their

settlements with the public, were of less real value than was

acknowledged to be due; they may be considered as having been forced, in

fact, on the receivers. They cannot, therefore, be fairly adjudged an

extinguishment of the debt. They may appeal to the motives for

establishing public credit, for which justice and faith form the natural

foundation. They may appeal to the precedent furnished by the

compensation allowed to the army during the late war, for the

depreciation of bills, which nominally discharged the debts. They may

appeal to humanity, for the sufferings of the military part of the

creditors can never be forgotten, while sympathy is an American virtue.

To say nothing of the singular hardship, in so many months, of requiring

those who have lost four-fifths, or seven-eighths of their due, to

contribute the remainder in favor of those who have gained in the

contrary proportion.

On the other hand, the holders by assignment have claims, which I by no

means wish to depreciate. They will say, that whatever pretensions

others may have against the public, these cannot affect the validity of

theirs. That if they gain by the risk taken upon themselves, it is but

the just reward of that risk. That as they hold the public promise, they

have an undeniable demand on the public faith. That the best foundation

of public credit is that adherence to literal engagements on which it

has been erected by the most flourishing nations. That if the new

Government should swerve from so essential a principle, it will be

regarded by all the world as inheriting the infirmities of the old. Such

being the interfering claims on the public, one of three things must be

done; either pay both, reject wholly one or the other, or make a

_composition_ between them on some principle of equity. To pay both is

perhaps beyond the public ability; and as it would far exceed the value

received by the public, it will not be expected by the world, nor even

by the creditors themselves. To reject wholly the claims of either is

equally inadmissible; such a sacrifice of those who possess the written

engagements would be fatal to the proposed establishment of public

credit; it would moreover punish those who had put their trust in the

public promises and resources. To make the other class the sole victims

is an idea at which human nature recoils.

A composition, then, is the only expedient that remains; let it be a

liberal one in favor of the present holders, let them have the highest

price which has prevailed in the market; and let the residue belong to

the original sufferers. This will not do perfect justice; but it will do

more real justice, and perform more of the public faith, than any other

expedient proposed. The present holders, where they have purchased at

the lowest price of the securities, will have a profit that cannot

reasonably be complained of; where they have purchased at a higher

price, the profit will be considerable; and even the few who have

purchased at the highest price cannot well be losers, with a well funded

interest of six per cent. The original sufferers will not be fully

indemnified; but they will receive, from their country, a tribute due to

their merits, which, if it does not entirely heal their wounds, will

assuage the pain of them. I am aware, that many plausible objections

will lie against what I have suggested, some of which I foresee and will

take some notice of. It will be said, that the plan is impracticable;

should this be demonstrated, I am ready to renounce it; but it does not

appear to me in that light. I acknowledge that such a scale as has often

been a subject of conversation, is impracticable.

The discrimination proposed by me, requires nothing more than a

knowledge of the present holders, which will be shown by the

certificates; and of the original holders, which the office documents

will show. It may be objected, that if the Government is to go beyond

the literal, into the equitable claims against the United States, it

ought to go back to every case where injustice has been done. To this

the answer is obvious: the case in question is not only different from

others in point of magnitude and of practicability, but forces itself on

the attention of the committee, as necessarily involved in the business

before them. It may be objected, that public credit will suffer,

especially abroad; I think this danger will be effectually obviated by

the honesty and disinterestedness of the Government displayed in the

measure, by a continuance of the punctual discharge of foreign interest,

by the full provision to be made for the whole foreign debt, and the

equal punctuality I hope to see in the future payments on the domestic

debts. I trust also, that all future loans will be founded on a previous

establishment of adequate funds; and that a situation, like the present,

will be thereby rendered impossible.

I cannot but regard the present case as so extraordinary, in many

respects, that the ordinary maxims are not strictly applicable to it.

The fluctuations of stock in Europe, so often referred to, have no

comparison with those in the United States. The former never exceeded

50, 60, or 70 per cent.: can it be said, that because a Government

thought this evil insufficient to justify an interference, it would view

in the same light a fluctuation amounting to seven or eight hundred per

cent.

I am of opinion, that were Great Britain, Holland, or any other country,

to fund its debts precisely in the same situation as the American debt,

some equitable interference of the Government would take place. The

South Sea scheme, in which a change, amounting to one thousand per cent.

happened in the value of stock, is well known to have produced an

interference, and without any injury whatever to the subsequent credit

of the nation. It is true, that in many respects, the case differed from

that of the United States; but, in other respects, there is a degree of

similitude, which warrants the conjecture. It may be objected, that such

a provision as I propose will exceed the public ability; I do not think

the public unable to discharge honorably all its engagements, or that it

will be unwilling, if the appropriations shall be satisfactory. I

regret, as much as any member, the unavoidable weight and duration of

the burthens to be imposed; having never been a proselyte to the

doctrine, that public debts are public benefits. I consider them, on the

contrary, as evils which ought to be removed as fast as honor and

justice will permit, and shall heartily join in the means necessary for

that purpose. I conclude with declaring, as my opinion, that if any case

were to happen among individuals, bearing an analogy to that of the

public, a Court of Equity would interpose for its redress; or that if a

tribunal existed on earth, by which nations could be compelled to do

right, the United States would be compelled to do something not

dissimilar in its principles to what I have contended for.

Mr. LIVERMORE wished the amendment he had formerly mentioned might be

made to the original proposition; it was, to insert, before the word

"interest," the words, "at a certain rate o."

Mr. SHERMAN apprehended it would strongly imply that Congress meant to

reduce the rate of interest, and he did not wish that question involved

with the present.

Mr. LIVERMORE's motion being seconded, the question was put thereon, and

it being lost,

Mr. MADISON moved to amend the original proposition, so as to read as

follows:

_Resolved_, That adequate funds ought to be provided for

paying the interest and principal of the domestic debt, as

the same shall be liquidated; and that in such liquidation,

the present holders of public securities, which have been

alienated, shall be settled with according to the highest

market rate of such securities; and that the balance of the

sums due from the public, be paid in such proportion to the

original holder of such securities.

Mr. BOUDINOT said, he had long been in the habit of paying great respect

to the sentiments of the gentleman from Virginia; but he feared, on this

occasion, he had not viewed the subject with his usual accuracy. He was

not surprised that the gentleman was led away by the dictates of his

heart, for he believed he really felt for the misfortunes of his

fellow-citizens, who had been the prey of avaricious men. Indeed, it is

matter of less surprise, on another account, for heretofore I

contemplated the subject in nearly the same point of view. Influenced by

a desire to do justice to every person connected with the public, I

wished for the means of compensating the original holders, who had sold

their certificates at a great loss; but I found the thing, upon long and

careful examination, to be both unjust and impracticable.

The honorable gentleman tells us, that the debt was contracted for

meritorious services, and inquires whether the creditor received an

adequate compensation in full discharge? I say, sir, this debt is still

due, and that the person to whom it is due, has received nothing but a

certificate as evidence of his claim; but then, if any of our first

creditors have put another person in their shoes, the question will

arise, are we to disown the act of the party himself? Are we to say, we

will not be bound by your transfer, we will not treat with your

representative, but insist upon a resettlement with you alone? But the

same reasoning will oblige us to go further, and investigate all the

claims of those who have received of the Government Continental money,

which they afterwards parted with for ten, forty, or one hundred for

one.

FRIDAY, February 12.

_Abolition of Slavery._

The following memorial of the Pennsylvania Society for promoting the

Abolition of Slavery, the relief of free negroes unlawfully held in

bondage, and the improvement of the condition of the African race, was

presented and read:

The memorial respectfully showeth,

That from a regard for the happiness of mankind, an

association was formed several years since in this State,

by a number of her citizens, of various religious

denominations, for promoting the abolition of slavery, and

for the relief of those unlawfully held in bondage. A just

and acute conception of the true principles of liberty, as

it spread through the land, produced accessions to their

numbers, many friends to their cause, and a Legislative

co-operation with their views, which, by the blessing of

Divine Providence, have been successfully directed to the

relieving from bondage a large number of their

fellow-creatures of the African race. They have also the

satisfaction to observe, that in consequence of that spirit

of philanthropy and genuine liberty which is generally

diffusing its beneficial influence, similar institutions

are forming at home and abroad.

That mankind are all formed by the same Almighty Being,

alike objects of his care, and equally designed for the

enjoyment of happiness, the Christian religion teaches us

to believe, and the political creed of Americans fully

coincides with the position. Your memorialists,

particularly engaged in attending to the distresses arising

from slavery, believe it their indispensable duty to

present this subject to your notice. They have observed,

with real satisfaction, that many important and salutary

powers are vested in you for "promoting the welfare and

securing the blessings of liberty to the people of the

United States;" and as they conceive that these blessings

ought rightfully to be administered, without distinction of

color, to all descriptions of people, so they indulge

themselves in the pleasing expectation, that nothing which

can be done for the relief of the unhappy objects of their

care will be either omitted or delayed.

From a persuasion that equal liberty was originally the

portion, and is still the birthright of all men; and

influenced by the strong ties of humanity, and the

principles of their institution, your memorialists conceive

themselves bound to use all justifiable endeavors to loosen

the bands of slavery, and promote a general enjoyment of

the blessings of freedom. Under these impressions, they

earnestly entreat your serious attention to the subject of

slavery; that you will be pleased to countenance the

restoration of liberty to those unhappy men, who alone, in

this land of freedom, are degraded into perpetual bondage,

and who, amidst the general joy of surrounding freemen, are

groaning in servile subjection; that you will devise means

for removing this inconsistency from the character of the

American people; that you will promote mercy and justice

towards this distressed race, and that you will step to the

very verge of the power vested in you for discouraging

every species of traffic in the persons of our fellow-men.

BENJ. FRANKLIN, _President_.

PHILADELPHIA, _February_ 3, 1790.

Mr. HARTLEY then called up the memorial presented yesterday, from the

annual meeting of Friends at Philadelphia, for a second reading;

whereupon the same was read a second time, and moved to be committed.

Mr. TUCKER was sorry the petition had a second reading, as he conceived

it contained an unconstitutional request, and from that consideration he

wished it thrown aside. He feared the commitment of it would be a very

alarming circumstance to the Southern States; for if the object was to

engage Congress in an unconstitutional measure, it would be considered

as an interference with their rights, the people would become very

uneasy under the Government, and lament that they ever put additional

powers into their hands. He was surprised to see another memorial on the

same subject; and that signed by a man who ought to have known the

constitution better. He thought it a mischievous attempt, as it

respected the persons in whose favor it was intended. It would buoy them

up with hopes, without a foundation, and as they could not reason on the

subject, as more enlightened men would, they might be led to do what

they would be punished for, and the owners of them, in their own

defence, would be compelled to exercise over them a severity they were

not accustomed to. Do these men expect a general emancipation of slaves

by law? This would never be submitted to by the Southern States without

a civil war. Do they mean to purchase their freedom? He believed their

money would fall short of the price. But how is it they are more

concerned in this business than others? Are they the only persons who

possess religion and morality? If the people are not so exemplary,

certainly they will admit the clergy are; why, then, do we not find them

uniting in a body, praying us to adopt measures for the promotion of

religion and piety, or any moral object? They know it would be an

improper interference; and to say the best of this memorial, it is an

act of imprudence, which he hoped would receive no countenance from the

House.

Mr. SENEY denied that there was any thing unconstitutional in the

memorial; at least, if there was it had escaped his attention, and he

should be obliged to the gentleman to point it out. Its only object was,

that Congress should exercise their constitutional authority to abate

the horrors of slavery, as far as they could; indeed, he considered that

all altercation on the subject of commitment was at an end, as the House

had impliedly determined yesterday that it should be committed.

Mr. BURKE saw the disposition of the House, and he feared it would be

referred to a committee, maugre all their opposition; but he must

insist, that it prayed for an unconstitutional measure; did it not

desire Congress to interfere and abolish the slave trade, while the

constitution expressly stipulates that Congress shall exercise no such

power? He was certain the commitment would sound an alarm, and blow the

trumpet of sedition in the Southern States. He was sorry to see the

petitioners paid more attention to than the constitution; however, he

would do his duty and oppose the business totally; and if it was

referred to a committee, as mentioned yesterday, consisting of a member

from each State, and he was appointed, he would decline serving.

Mr. SCOTT.--I cannot entertain a doubt but the memorial is strictly

agreeable to the constitution; it respects a part of the duty

particularly assigned to us by that instrument, and I hope we may be

inclined to take it into consideration. We can at present lay our hands

upon a small duty of ten dollars; I would take this, and if it is all

that we can do, we must be content: but I am sorry that the framers of

the constitution did not go further, and enable us to interdict the

traffic entirely; for I look upon the slave trade to be one of the most

abominable things on earth; and if there was neither God nor devil, I

should oppose it upon the principles of humanity, and the law of nature.

I cannot, for my part, conceive how any person can be said to acquire a

property in another; is it by virtue of conquest? What are the rights of

conquest? Some have dared to advance this monstrous principle, that the

conqueror is absolute master of his conquest; that he may dispose of it

as his property, and treat it as he pleases; but, enough of those who

reduce men to the state of transferable goods, or use them like beasts

of burthen, who deliver them up as property or patrimony to others. Let

us argue on principles countenanced by reason and becoming humanity; the

petitioners view the subject in a religious light, but I do not stand in

need of religious motives to induce me to reprobate the traffic in human

flesh; other considerations weigh with me to support the commitment of

the memorial, and to support every constitutional measure likely to

bring about its total abolition. Perhaps, in our Legislative capacity,

we can go no further than to impose a duty of ten dollars; but I do not

know how far I might go, if I was one of the Judges of the United

States, and those people were to come before me and claim their

emancipation; but I am sure I would go as far as I could.

Mr. JACKSON differed with the gentleman last up, and supposed the master

had a qualified property in his slave. He said the contrary doctrine

would go to the destruction of every species of personal service. The

gentleman said, he did not stand in need of religion to induce him to

reprobate slavery, but if he is guided by that evidence upon which the

Christian system is founded, he will find that religion is not against

it. He will see, from Genesis to Revelations, the current setting strong

that way. There never was a Government on the face of the earth, but

what permitted slavery. The purest sons of freedom in the Grecian

Republics, the citizens of Athens and Lacedæmon, all held slaves. On

this principle the nations of Europe are associated; it is the basis of

the feudal system. But suppose all this to have been wrong, let me ask

the gentleman if it is good policy to bring forward a business at this

moment, likely to light up the flame of civil discord; for the people of

the Southern States will resist one tyranny as soon as another? The

other parts of the continent may bear them down by force of arms, but

they will never suffer themselves to be divested of their property

without a struggle. The gentleman says, if he was a Federal Judge, he

does not know to what length he would go in emancipating these people;

but I believe his judgment would be of short duration in Georgia,

perhaps even the existence of such a judge might be in danger.

Mr. SHERMAN could see no difficulty in committing the memorial; because

it was probable the committee would understand their business, and

perhaps they might bring in such a report as would be satisfactory to

gentlemen on both sides of the House.

Mr. BALDWIN was sorry the subject had ever been brought before Congress,

because it was of a delicate nature as it respected some of the States.

Gentlemen who had been present at the formation of this constitution

could not avoid the recollection of the pain and difficulty which the

subject caused in that body. The members from the Southern States were

so tender upon this point, that they had well-nigh broken up without

coming to any determination; however, from the extreme desire of

preserving the Union, and obtaining an efficient Government, they were

induced mutually to concede, and the constitution jealously guarded what

they agreed to. If gentlemen look over the footsteps of that body, they

will find the greatest degree of caution used to imprint them, so as not

to be easily eradicated; but the moment we go to jostle on that ground,

I fear we shall feel it tremble under our feet. Congress have no power

to interfere with the importation of slaves beyond what is given in the

ninth section of the first article of the constitution; every thing

else is interdicted to them in the strongest terms. If we examine the

constitution, we shall find the expressions relative to this subject

cautiously expressed, and more punctiliously guarded than any other

part, "The migration or importation of such persons shall not be

prohibited by Congress." But lest this should not have secured the

object sufficiently, it is declared, in the same section, "That no

capitation or direct tax shall be laid, unless in proportion to the

census;" this was intended to prevent Congress from laying any special

tax upon negro slaves, as they might, in this way, so burthen the

possessors of them as to induce a general emancipation. If we go on to

the fifth article, we shall find the first and fifth clauses of the

ninth section of the first article restrained from being altered before

the year 1808.

Gentlemen have said that this petition does not pray for an abolition of

the slave trade. I think, sir, it prays for nothing else; and therefore

we have no more to do with it than if it prayed us to establish an order

of nobility, or a national religion.

Mr. SYLVESTER said, that he had always been in the habit of respecting

the Society called Quakers; he respected them for their exertions in the

cause of humanity; but he thought the present was not a time to enter

into a consideration of the subject, especially as he conceived it to be

a business within the province of the State Legislatures.

Mr. LAWRENCE observed, that the subject would undoubtedly come under the

consideration of the House; and he thought, as it was now before them,

that the present time was as proper as any; he was therefore for

committing the memorial, and when the prayer of it had been properly

examined, they could see how far Congress may, constitutionally,

interfere: as they knew the limits of their power on this, as well as

every other occasion, there was no just apprehension to be entertained

that they would go beyond it.

Mr. SMITH (of South Carolina) insisted that it was not in the power of

the House to grant the prayer of the petition, which went to the total

abolishment of the slave trade, and it was therefore unnecessary to

commit it. He observed, that in the Southern States difficulties had

arisen on adopting the constitution, inasmuch as it was apprehended that

Congress might take measures under it for abolishing the slave trade.

Perhaps the petitioners, when they applied to this House, did not think

their object unconstitutional, but now they are told that it is, they

will be satisfied with the answer, and press it no further. If their

object had been for Congress to lay a duty of ten dollars per head on

the importation of slaves, they would have said so, but that does not

appear to have been the case. The commitment of the petition, on that

ground, cannot be contended. If they will not be content with that,

shall it be committed to investigate facts? The petition speaks of

none. For what purpose, then, shall it be committed? If gentlemen can

assign no good reason for the measure, they will not support it when

they are told that it will create jealousies and alarm in the Southern

States; for I can assure them that there is no point on which they are

more jealous and suspicious, than on a business with which they think

the Government has nothing to do.

When we entered into this confederacy, we did it from political, not

from moral motives, and I do not think my constituents want to learn

morals from the petitioners; I do not believe they want improvements in

their moral system; if they do, they can get it at home.

The gentleman from Georgia has justly stated the jealousy of the

Southern States. On entering into this Government, they apprehend that

the other States, not knowing the necessity the citizens of the Southern

States were under to hold this species of property, would, from motives

of humanity and benevolence, be led to vote for a general emancipation;

and had they not seen that the constitution provided against the effect

of such a disposition, I may be bold to say they never would have

adopted it. And, notwithstanding all the calmness with which some

gentlemen have viewed the subject, they will find that this discussion

alone will create great alarm. We have been told, that if this would be

the case, we ought to have avoided it, by saying nothing; but it was not

for that purpose that we were sent here. We look upon this measure as an

attack upon the palladium of the property of our country; it is

therefore our duty to oppose it by every means in our power. Gentlemen

should consider, that when we entered into a political connection with

the other States, that this property was there; it was acquired under a

former Government, conformably to the laws and constitution, therefore

any thing that will tend to deprive them of that property, must be an

_ex post facto_ law, and, as such, is forbidden by our political

compact.

I said the States would never have entered into the Confederation,

unless their property had been guarantied to them, for such is the state

of agriculture in that country, that without slaves it must be

abandoned. Why will these people, then, make use of arguments to induce

the slave to turn his hand against his master? We labor under

difficulties enough from the ravages of the late war. A gentleman can

hardly come from that country with a servant or two, either to this

place or Philadelphia, but there are persons trying to seduce his

servants to leave him; and, when they have done this, the poor wretches

are obliged to rob their master, in order to obtain a subsistence; all

those, therefore, who are concerned in this seduction, are accessories

to the robbery.

The reproaches which they cast upon the owners of negro property, is

charging them with the want of humanity. I believe the proprietors have

as much humanity as persons in any part of the continent, and are as

conspicuous for their good morals as their neighbors. It was said

yesterday that the Quakers are a society known to the laws and the

constitution, but they are no more so than other religious societies;

they stand exactly in the same situation; their memorial, therefore,

relates to a matter in which they are no more interested than any other

sect, and can only be considered as a piece of advice, which it is not

customary to refer to a committee; but if it is supposed to pray for

what they think a moral purpose, is that sufficient to induce us to

commit it? What may appear a moral virtue in their eyes, may not be so

in reality. I have heard of a sect of Shaking Quakers, who, I presume,

suppose their tenets of a moral tendency. I am informed one of them

forbids to intermarry, yet you may see them with a numerous offspring

about them. Now, if these people were to petition Congress to pass a law

prohibiting matrimony, would gentlemen agree to refer such a petition? I

think if they would reject one of that nature, as improper, they ought

also to reject this.

Mr. PAGE was in favor of the commitment. He hoped that the designs of

the respectable memoralists would not be stopped at the threshold, in

order to preclude a fair discussion of the prayer of the memorial. He

observed, that gentlemen had founded their arguments upon a

misrepresentation; for the object of the memorial is not declared to be

the total abolition of the slave trade, but that Congress will consider

whether it be not in reality within their power to exercise justice and

mercy, which, if adhered to, they cannot doubt must produce the

abolition of the slave trade. If, then, the prayer contained nothing

unconstitutional, he trusted the meritorious effort of the petitioners

would not be frustrated.

With respect to the alarm that was apprehended, he conjectured there was

none; but there might be just cause if the memorial was not taken into

consideration. He placed himself in the case of a slave, and said, that,

on hearing that Congress had refused to listen to the decent suggestions

of a respectable part of the community, he should infer that the General

Government (from which was expected great good would result to every

class of citizens) had shut their ears against the voice of humanity,

and he should despair of any alleviation of the miseries he and his

posterity had in prospect; if any thing could induce him to rebel, it

must be a stroke like this, impressing on his mind all the horrors of

despair. But if he was told that application was made in his behalf, and

that Congress was willing to hear what could be urged in favor of

discouraging the practice of importing his fellow-wretches, he would

trust in their justice and humanity, and wait the decision patiently. He

presumed that these unfortunate people would reason in the same way, and

he, therefore, conceived the most likely way to prevent danger was to

commit the petition. He lived in a State which had the misfortune of

having in her bosom a great number of slaves; he held many of them

himself, and was as much interested in the business, as any gentleman in

South Carolina or Georgia, yet if he was determined to hold them in

eternal bondage, he should feel no uneasiness or alarm on account of the

present measure, because he should rely upon the virtue of Congress that

they would not exercise any unconstitutional authority.

Mr. MADISON.--The debate has taken a serious turn, and it will be owing

to this alone if an alarm is created; for, had the memorial been treated

in the usual way, it would have been considered as a matter of course,

and a report might have been made so as to have given general

satisfaction. If there was the slightest tendency by the commitment to

break in upon the constitution, he would object to it; but he did not

see upon what ground such an event was to be apprehended. The petition

prayed, in general terms, for the interference of Congress, so far as

they were constitutionally authorized: but even if its prayer was, in

some degree, unconstitutional, it might be committed, as was the case on

Mr. Churchman's petition, one part of which was supposed to apply for an

unconstitutional interference by the General Government. He admitted,

that Congress is restricted by the constitution from taking measures to

abolish the slave trade; yet there are a variety of ways by which it

could countenance the abolition, and regulations might be made in

relation to the introduction of them into the new States to be formed

out of the Western Territory. He thought the object well worthy of

consideration.

Mr. GERRY thought the interference of Congress fully compatible with the

constitution, and could not help lamenting the miseries to which the

natives of Africa were exposed by this inhuman commerce. He never

contemplated the subject, without reflecting what his own feelings would

be, in case himself, his children, or friends were placed in the same

deplorable circumstances. He then adverted to the flagrant acts of

cruelty which are committed in carrying on that traffic; and asked,

whether it can be supposed that Congress has no power to prevent such

abuses? He then referred to the constitution, and pointed out the

restrictions laid on the General Government respecting the importation

of slaves. It was not, he presumed, in the contemplation of any

gentleman in this House to violate that part of the constitution; but

that we have a right to regulate this business, is as clear as that we

have any rights whatever; nor has the contrary been shown by any person

who has spoken on the occasion. Congress can, agreeably to the

constitution, lay a duty of ten dollars on imported slaves; they may do

this immediately. He made a calculation of the value of the slaves in

the Southern States, and supposed they may be worth ten millions of

dollars. Congress have a right, if they see proper, to make a proposal

to the Southern States to purchase the whole of them, and their

resources in the Western Territory might furnish them with the means. He

did not intend to suggest a measure of this kind; he only instanced

these particulars to show that Congress certainly has a right to

intermeddle in the business. He thought that no objection had been

offered of any force to prevent the commitment of the memorial.

Mr. BOUDINOT had carefully examined the petition and found nothing like

what was complained of by gentlemen contained in it; he, therefore,

hoped they would withdraw their opposition and suffer it to be

committed.

Mr. SMITH (of South Carolina) said, that as the petitioners had

particularly prayed Congress to take measures for the annihilation of

the slave trade; and as that was admitted, on all hands, to be beyond

their power, and as the petitioners would not be gratified by a tax of

ten dollars per head, which was all that was within their power, there

was, of consequence, no occasion for committing it.

The question on the commitment being about to be put, the yeas and nays

were called for, and were as follows:

YEAS.--Messrs. Ames, Benson, Boudinot, Brown, Cadwalader,

Clymer, Fitzsimons, Floyd, Foster, Gale, Gerry, Gilman,

Goodhue, Griffin, Grout, Hartley, Hathorn, Heister,

Huntington, Lawrence, Lee, Leonard, Livermore, Madison,

Moore, Muhlenberg, Page, Parker, Partridge, Rensselaer,

Schureman, Scott, Sedgwick, Seney, Sherman, Sinnickson,

Smith, (of Maryland,) Sturges, Thatcher, Trumbull,

Wadsworth, White, and Wynkoop--43.

NAYS.--Messrs. Baldwin, Bland, Burke, Coles, Huger,

Jackson, Matthews, Sylvester, Smith, (of South Carolina,)

Stone, and Tucker--14.

The memorials were referred accordingly.

MONDAY, February 15.

_Public Credit._

The House went again into a Committee of the Whole on the report of the

Secretary of the Treasury, Mr. BALDWIN in the chair.

Mr. MADISON's motion for a discrimination being under consideration,

Mr. SEDGWICK.--The proposition, Mr. Chairman, contains a question of the

utmost importance. And the committee must be obliged to the gentleman

who brought it forward for his very ingenious discussion of the subject

of the domestic debt. With respect to the question now before the

committee, so much has been said, that I think it will not be necessary

to consume much of their time in the investigation. On the subject of

contracts I have to observe, that whenever a voluntary engagement is

made for a valuable consideration for property advanced or services

rendered, and the terms of the contract are understood, if no fraud or

imposition is practised, the party engaging is bound to the performance,

according to the literal meaning of the words in which it is expressed.

Such contract, whether of a Government or an individual, may be either

transferable or not transferable. The latter species of contract

receives an additional value from its capacity of being transferred, if

the circumstances of the possessor should render a sale of it necessary

or convenient to him. To render the transferable quality of such

evidences of contract in any degree advantageous to the possessor, it is

necessary to consider, in case of sale, the alienee possessed of all the

property of the original holder; and indeed it is highly absurd, and

even contradictory, to say, that such evidences of debt are

transferable, and at the same time to say that there is in them a kind

of property that the holder could not convey by _bona fide_ contract.

This is the construction which has invariably been given to these

contracts, whether formed by Government or by individuals. To deprive

the citizen of the power of binding himself by his own voluntary

contract, or to prevent a disposition of property in its nature

alienable, would be a violent and unjustifiable invasion of one of those

rights of which man, as a citizen, is the most tenacious, and would

indeed break one of the strongest bonds by which society is holden

together.

In the transfers which have been made, the contracts were fairly made;

the whole rights have been transferred. It is not pretended any fraud or

imposition has been practised. The risk was calculated by the parties,

and it was observed, that the risk contemplated a revolution in the

Government.

From the foregoing deduction of particulars, it is presumed to be proved

that a property is vested in the transferees. That if this property is

divested by the Government, the law for that purpose would have a

retrospective operation, and that no _ex post facto_ law could be more

alarming than that by which the right of private property is violently

invaded.

Having considered the nature of the contract, and of the obligations

which result from it, I beg leave to call the attention of the committee

to those circumstances by which that obligation may be destroyed,

impaired, or suspended. They are stated to be, 1. Performance. 2.

Voluntary discharge. 3. Composition. 4. Inability.

And gentlemen are called upon to give information of any other causes

which can produce either of those effects.

With regard, more particularly, to the proposition before the committee,

I have, to observe, that with regard to these contracts, there has

existed a depreciation in consequence of the failure of Government

regularly to pay the interest. That in this depreciated state, the

securities have been alienated; that of course the original holders have

sustained a loss; that if the loss resulted from the fault, and not the

misfortune of Government, the creditors have, undeniably, a demand

against the Government for compensation; that this demand, however well

founded, can never authorize the Government to invade the honestly

acquired property of the present possessors, a property warranted by the

terms of the contract itself, and sanctioned by the act of Congress, of

April, 1783, and the validity of it recognized by the constitution we

have sworn to support.

With regard to the claims of the original holders, it is, however,

observable, that the domestic creditor, at the time the contract was

formed, well knew the nature of the constitution of the Government

administered by Congress, the other contracting party; that its power of

performance depended on the ability and good-will of the States; that

Congress had always performed its duty, had made the necessary

requisitions; that this was its utmost power; and that the failure had

arisen wholly from the neglect of the States. I therefore submit it to

the committee, whether, if the original holder has a just or equitable

demand, he should not resort to the State of which he is a member?

I admit, that the case of an original holder is indeed a hard one; that

I have a respect for his misfortunes and for his pretensions; that if

satisfaction is discovered to be just and practicable, I would not

hesitate to go to the utmost ability of the Government for that purpose.

But let me ask, what merit will the Government possess, if it strip one

class of citizens, who have acquired property by the known and

established rules of law, under the specious pretence of doing justice

to another class of citizens?

It was implicitly agreed, that eighty per cent. depreciation would not

authorize the interference proposed by the motion. I ask, then, for some

point of depreciation to be pointed out, which will authorize such

interference.

The question for which I contend has received the universal approbation

of mankind; there are no instances of the interference contended for,

and this general sense of mankind affords me some evidence of truth.

This contract was founded on a valuable consideration. It was the price

of our liberty and independence. The possessor claimed, according to the

very terms of the contract, though it is not pretended that the

engagements of Government have been performed. No composition with the

creditors is proposed; nor is the proposition founded on any pretended

inability of the Government; for to comply with the intention of it,

1,600,000 dollars, annually, more than is proposed by the report of the

Secretary, would be required.

By reason of the circumstances which have taken place, the honorable

gentleman (Mr. MADISON) supposes, that, if the whole amount of a

security shall be paid to the present possessor, he will have a sum of

money to which the original holder is equitably entitled. If this is

true, then, no interposition is necessary, it being a well-known rule of

law, that an action will always lie to recover money out of the hands of

another, to which the plaintiff, from the principles of equity and good

conscience, is entitled.

With regard to the effects, which will probably result from this

measure, I have to observe, that they will be destructive to our

national character. That the world is now willing, charitably, to impute

our former miscarriages to events we could not control; but should our

first measures, in regard to public faith, be a violent infraction of

our contracts, it will sanction all our bitterest enemies have said, to

our disadvantage. With regard to its effects on credit, little

dependence will be placed on the plighted faith of a Government which,

under the pretence of doing equity, has exercised a power of dispensing

with its contracts, and has thereby formed for itself a precedent of

future violations, both with respect to its funds and contracts. With

regard to discovering who was the original holder, except so far as

respects the army debt, I am certain there are no documents by which the

necessary facts can be discovered.

I presume it is a fact, with regard to much the greater part of the

debt, that any fictitious name was inserted. And with regard to the army

debt, the soldiers, generally, who were in the service at the conclusion

of the war, had received ample satisfaction for their services, at the

time of their enlistment, having been paid more, on an average, than two

hundred and fifty dollars per man.

I have only to add, that the proposed system will lay a foundation for

infinite frauds and perjuries, and that it will, beyond all powers of

calculation, multiply the evils of speculation.

Mr. LAWRENCE observed, that the proposition of the gentleman from

Virginia (Mr. MADISON) derived force from the talents and knowledge of

that gentleman in public transactions; but that, on examination, it

would be found to contain doctrines very repugnant to the interest and

prosperity of the Union.

He then stated, that the debts contracted by the United States were for

loans of money, supplies of articles necessary for the public wants, and

for actual services rendered in different employments. That these debts

were ultimately adjusted and reduced to their present transferable form.

That every part of the contract was essential to it. The negotiability

was a material part. That the nature of the contract was frequently

recognized by the late Government. That, in 1783, Congress recommended

certain funds to be established to pay the interest, and put the

principal in a course of discharge. That this recommendation was

unequivocal, as to the nature of it, and made no discrimination between

the possessor and original holder. That the subsequent conduct of that

body was conformable to this recommendation. That they had annually

called on the States to furnish money to pay the interest, without

discriminating between the original holder and present possessor. That

they had paid interest on the securities, without making any

discrimination. That provision had been made for holders of loan-office

certificates that were subject to liquidation, to have them cancelled,

and others issued for the specie value. That the holders of certificates

were enabled to have them registered, to guard against accidents; and

that no distinction was made between the original holder and the

alienee. That the transferable nature of the claim was for the benefit

of the creditor, because it gave it an active value. That he consented

to take it, and consulted his own advantage. That the conduct of the

late Congress, since the war, had been uniform in the support of this

contract, and they had done no act to impair its obligation, according

to the terms of it. That this contract was valid against the Government;

for, notwithstanding the truth of the gentleman's observations, that the

nation is the same, though the bodies that administered the Government

were different, there was yet far greater security; and to remove all

doubt, a clause that made all debts and engagements valid against the

United States, under the late General Government, valid against the

present, was inserted in the constitution.

He further observed, that this contract having descended upon the

Government, there was no right in the Legislature to impair the force of

it. That the particular Governments are restrained from passing laws

impairing the obligations of contracts. That this interference would be

a violation of the contract, between the individuals, when the

certificate was transferred; and it would not be presumed, the States

being prohibited, that the General Government had the power to do it.

He then adverted to the principles of the gentleman, to wrest the

obligation of the public to the original holder; and observed, that the

same principles were in favor of the present possessor. That public

justice required a performance of contracts, when there was no fraud on

the part of the holder. That the possessor had been guilty of no fraud,

no deception. That the contract between him and the original holder was

fair, and that a hazard and risk attended the purchase adequate to the

advantage. That nothing short of a revolution in Government could have

produced payment. That if there was an imposition, the public occasioned

it; and between the original holder and the public, there might be a

claim for retribution. That public faith was as sacredly pledged to the

bearer, or present possessor, as to the original creditor. That public

credit results from fair and upright conduct; that the Government, to

support it, must perform its contract. That this was a contract

recognized by them, and as such should be discharged. That the condition

we have been in made it proper for us to be cautious on this subject;

and even at present, people doubted our disposition to establish our

credit. That this would give a fatal blow to it, and when we should

recover, if ever, was doubtful. That the public opinion was difficult

to be ascertained; gentlemen had different modes to determine it. He

supposed it was better ascertained by the acts of public bodies than by

squibs in the newspapers, or by pamphlets written by individuals. That

the uniform conduct of men, deputed by the particular States to

represent them, in the late General Government, was the best standard;

and their opinion, from the year 1783, was in favor of the present

possessor. That the conduct of the particular States was another

circumstance; that he did not know of any discrimination made by them,

though it had been attempted. That the general opinion of men of

property was in favor of it; and that these sources of public opinion

were more certain than those he had before mentioned.

He further observed, that although he believed gentlemen supposed no

advantage would be derived to the United States from this

discrimination, yet much would arise. That part of the army was composed

of foreigners, many had left the country, others were dead; all their

part would be unclaimed. That certificates were issued to public

officers to a great amount, and were paid by them to persons from whom

they purchased. The difficulty of making proof of the original creditor

would be great; and, from this circumstance, great sums would be gained

to the public. That there were persons enough who would have sagacity to

discern this; and they would doubt the purity of the public motive,

should the gentleman's plan be adopted.

He then adverted to the circumstance of the new creditor receiving

paper. That this paper might be subject to another liquidation on the

same principle as the present. That it would introduce doubt and

distrust of public engagements; and there would be no greater security,

although a fund was pledged, than there is at present, for whenever the

public pleased, they might destroy the obligation. Arguments were

improperly addressed to their feelings; but that however hard it may be

for the original creditor, who had parted with his certificates, to

contribute to pay the debt, yet it would be equally hard on him who had

been injured by Continental money, who had been plundered by the enemy,

who had had his property burned by them in the course of the war; and

that instances of these kinds were numerous.

He then adverted to the doctrine of the Court of Equity; and urged that

this court must be governed by principle. That were the committee this

high court, and the United States the original creditor, and the present

possessor before them; and if there appeared no fraud on the part of the

possessor, the original creditor would have no just claim on him. That

between the United States and original creditors, the United States were

in fault, and the claim, if good, would be against them.

Mr. SMITH (of S. C.) remarked, that it was necessary and proper the

House should give the subject the most ample discussion. The question

had long agitated the public mind, and the people should know that it

had occupied the serious attention of their Representatives, and be made

acquainted with the principles of their decision. For his part, having

bestowed on it the most attentive consideration, he could assert, that

the more he contemplated it, the more he was impressed with a

conviction, that the proposition was unjust, impolitic, and

impracticable. It consisted of two parts: The one was to take away the

property of one person; the other was to give that property to another;

and this by a voluntary interposition of the House, by a mere act of

power, without the assent of the former, or without even the application

of the latter. For it was remarkable, that the original holders, who had

alienated their certificates, had not come forward with this demand; and

it is presumable, that, had they applied for redress, they would reject

any indemnification which was the result of such manifest injustice. To

prove that this was taking away the property of a citizen by force, he

observed, that the purchaser had, by a fair purchase, acquired a right

to the full amount of the sum expressed in the certificate, which it was

not within the power of the House to divest him of. No tribunal on earth

could lawfully deprive a man of his property fairly obtained. The

purchaser bought under the act of Congress, making the securities

transferable; and having given the market price, without fraud or

imposition, he was, by virtue of such purchase, vested with the complete

and absolute ownership of the certificate, as fully as the original

holder; and had as much right to demand full payment as the original

holder would have had, had the security been still in his hands. Even

should the House refuse, by an act of power, to pay him more than half

his demand, the other half would still remain against the public; it

could not be extinguished. The debt would continue to haunt them; the

creditors would loudly clamor for justice, and sooner or later the

balance would be paid. Then would they incur all the odium of a

violation of private rights, without deriving to the public any

advantage whatever. He considered the measure as doing a certain evil,

that a possible good might result from it. This was not, in his opinion,

the proper mode of doing good. Justice cannot be founded on injustice;

and to take money out of the pocket of one man, to put it into that of

another, is a precedent which may justify future interferences. This

step would lead the House to others: for, if the principle be a just

one, then the Government should look into all the transactions and

speculations of individuals, in order to correct them, and make

retribution to every individual according to his losses. He was

persuaded, that the true policy of a Legislative body was, to pursue the

broad road of justice, clearly marked out before them; for it was an

undeniable truth, that whenever they deviated into by-roads and

trackless paths, without any other guide than their own imagination,

they would get bewildered in a labyrinth of difficulties, and rejoice to

trace back their steps, and regain the plain road. Now, the plain line

of conduct is, to do strict justice, such as is enforced in judicial

tribunals, between man and man, in a similar case. The debtor is bound

to pay the debt to the holder of the security; the contract, between the

giver of the bond and the person to whom it was given, is done away the

moment the latter assigns it to another person. If A gives a bond to B,

who parts with it to C, there is no longer any obligation on the part of

A to pay B, but he must pay it to C. A has nothing to do with the

private negotiations between B and C, nor to inquire what consideration

was given for the security. All that he has to inquire is, whether he

really signed it and had value received for it, and the amount of it. He

cannot say to the holder, you gave but fifty dollars for this security

of one hundred dollars, and I will pay you only fifty; for the law will

compel him to pay the hundred. This is a point of justice between man

and man. Is there another point of law and justice for the Government?

By what rule is the Government to square its conduct, if not by those

sacred rules which form the basis of civil society, and are the

safeguard of private property?

The gentleman from Virginia has said, that giving the present holders,

by alienation, the highest market price, would be doing them ample

justice; but did the public mean to refund them the money they had

actually advanced? No; they were to receive this ample justice by a bit

of paper, nominally for ten shillings; but which this very measure would

instantly depreciate to eight, or six shillings. They would have this

consolation, that, according to the gentleman's reasoning, they would

still have a claim against the Government for the balance. For, if the

original holder, by selling his certificate for four shillings, has now

a just claim against the Government for the balance of sixteen

shillings, which it is asserted he has, of course the alienee, to whom

the public should now acknowledge a debt of ten shillings, which he

would sell for only six, would hereafter have a just demand against the

public for four shillings. The reasoning might be carried further, for

it would follow, that whenever the public shall pay in paper which shall

depreciate, the seller will have a demand against the Government for the

difference.

The constitution itself, he said, was opposed to the measure, for it was

an _ex post facto_ law, which was prohibited in express terms. The

transfer of public securities was lawful at the time these alienations

were made; an attempt, therefore, to punish the transferees is an

attempt to make an _ex post facto_ law, by making that now unlawful

which was lawful at the time it was done. It alters the nature of the

transaction, and annexes the idea of guilt to that which at the moment

of commission, was not only perfectly innocent, but was explicitly

authorized and encouraged by a public act of Congress. By that act those

who had money were invited to purchase of those who held securities, and

now we are called upon to punish the purchasers who bought under that

invitation. The constitution restrains the States from passing any laws

impairing the force of contracts; _a fortiori_ is the Legislature of the

Union restrained. What an example to hold up to the Judiciary of the

United States! How could they annul a State law, when the State would be

able to plead a precedent on the part of Congress? The right of property

is a sacred right; no tribunal on earth can deprive a citizen of his

property, unless for a fair equivalent, for the public welfare. The

purchaser is vested, by the sale, with an absolute right, to the full

amount of the security, and it is beyond their authority to divest him

of it. They might, indeed, by an act of power, declare that he should be

paid only half; but his right to the other moiety would not be

extinguished. It had been said, that the original holder still had a

claim against the public, because he had received only two shillings and

sixpence for services worth twenty shillings. On the same principle, and

with more justice, the present holder would still have a claim for ten

shillings, because he has the public bond for twenty shillings. No

ingenuity can overcome these stubborn principles of law and justice;

they are immutable, and must ultimately prevail. The House had been told

that if the Government had defrauded the original holders out of their

dues, it was fit the public should rectify the fraud. The former

Government was not deficient in inclination to do them ample justice;

but, from the imbecility of the Confederation, had not the means. In

those days of democratic enthusiasm, the people were afraid of an

energetic Government: having so recently experienced the severity of the

former one, the citizens of these States were cautious in trusting any

Government with power; and it is not improbable that some of the

original holders, who suffered their embarrassments, from the want of a

Government competent to the payment of its debts, would themselves have

opposed vesting Congress with powers adequate to this object. Even the

present constitution, which is a mild one, met with considerable

opposition: had it been rejected, the public securities would have never

been paid.

Mr. AMES agreed with the gentleman from Virginia (Mr. MADISON) in regard

to the validity of the debt. There was propriety in saying the nation is

the same, though the Government be changed. The debt is the price of our

liberties, and cannot be diminished a farthing, the gentleman from

Virginia says; and why? Because the Government, as one of the

contracting parties, cannot annul, or vary the bargain without the

consent of the other. If the measure proposed by that gentleman

corresponds with that sound principle, he should have the pleasure of

agreeing with him on the ultimate decision; but if the measure should

be found, on a fair discussion, to be subversive of that principle, it

would not merit the countenance of the committee.

A claim upon our justice is made, on behalf of the original holders of

securities, who have transferred them. Does the plighted faith of the

country stand charged to pay the difference between the price their

securities sold for in the market and their nominal sum? In order to

make the affirmative appear, the worthy gentleman has said, that the

paper is the only evidence of a prior contract; and while the paper was

sold, the residuary right to the debt still remained in the seller.

Supposing this novel doctrine to be true, which cannot be conceded, it

will not warrant any conclusion in prejudice of any purchaser of the

Loan-office debt; for the paper was given when the loan was made; as no

prior debt existed, the paper is the very debt. The gentleman ought,

therefore, to confine his motion to the army debt, as his principle

seems inapplicable to any other. And even on liquidating the army debt,

the certificate extinguished the prior debt; otherwise the public would

be twice charged. As, when one man owes another an account, and gives

his bond for the balance, the account is no longer of force. By the

terms of the certificate, the person transferring has lost his claim

against the public. He has freely transferred; for if violence or fraud

were practised, the law will afford him redress. In society, as well as

in a state of nature, property is changed by the consent of the last

occupant. He may dispose of it by gift or at half price, and give a

complete title. Nor will the pretence that this transfer was free only

in appearance, avail; for the motives which disposed the owner to sell

cannot affect the right of the purchaser. Every such creditor risked

something; either that the Government would not pay him at all, or not

in due season. The risk, computed in free and open market, will be

nearly right. It is a kind of insurance against these risks, and the

insurers and insured will calculate the rate of insurance better than

Government can do it. If there is a new risk of Government interposing,

it seems that the purchaser, who may be called the insurer, did not rate

his risk high enough. It seems pretty clear, therefore, that there is no

claim on the stipulated justice of the country.

The committee rose, reported progress, and obtained leave to sit again.

TUESDAY, February 16.

_Public Credit._

The House again resolved itself into a Committee of the Whole on the

report of the Secretary of the Treasury, Mr. BALDWIN in the chair.

Mr. MADISON's proposition still under consideration.

Mr. JACKSON observed, that although as young a politician as any on the

floor, and convinced that the weight of experience was against him, on

so important a national subject, he could not be silent; particularly as

he had the honor of seconding the gentleman's motion (Mr. MADISON) now

before the House, that it would be therefore expected that he should

bring forward his reasons, and the principle which actuated him to it.

He confessed, that had he not before leaned to the side of a

discrimination, the arguments of that able gentleman would have induced

him to support the plan he had brought forward. He was induced on

another motive to rise, to show that the numerous arguments of the

gentlemen in opposition, yesterday, had not convinced him of the

impracticability or injustice of the composition.

The House were told much of the moral obligations we were under of

paying our debts, and the impolicy and injustice of interfering with

private contracts. The obligation, he believed, was nowhere denied; the

debt was of the highest nature; it was the price of our independence:

the only difficulty is, how that debt shall be discharged. He would here

observe, that the justice of the plan before the House, had not been so

fully objected to, as the impracticability, although it had been

asserted to be unjust, by some of the gentlemen who had spoken.

He would consider the justice of the proposition. The House had been

told the nature of those contracts, and the valuable considerations of

them. The contract, as it struck him, fell under the legal terms of _do,

ut des_; I give that thou mayest give--or, I give that I may receive. In

all contracts there are three requisites: 1st. The agreement. 2d. The

consideration. 3d. The thing to be done or omitted. This consideration

is to be an equivalent, or full recompense for the thing to be

performed. Let us examine what is the thing to be done, and what the

consideration is. The creditor, who was to perform the third article of

the contract, held twenty shillings, which was to be given for a

valuable consideration. What was this consideration? Two shillings and

sixpence. He argued, that if this twenty shillings was worth no more

than two shillings and sixpence, the contract was fair and substantial;

but, if gentlemen carried the idea further, and declared this twenty

shillings was money of equal value with the two shillings and sixpence

given, he contended that the contract was destroyed. Equity would

relieve, would declare it an unrighteous bargain, that there was not an

adequate compensation, and would set aside the contract.

This public opinion is in favor of the original creditor; it is

impossible to be otherwise. The people of America are a grateful people,

and they cannot, with indifference, view the earnings of those who

established their independence, converted into the coffers of the

wealthy and ambitious. The speculator, he contended, was already more

than satisfied, if it was only on the principle of interest which had

accrued for six, seven, and eight years past, and which they had

speculated on since.

Mr. BENSON.--The gentlemen in favor of this motion come forward as the

advocates of the late army. I wish, therefore, to be ascertained of one

fact, do the army wish a measure of this kind to take place? I apprehend

they do not; and I am led to this opinion from a knowledge of the habits

of military men; they prefer their honor to every pecuniary

consideration, and they generally are actuated by that principle alone.

I will state a case. Suppose I purchased an officer's certificate for

one hundred dollars, and I was to fund it; the Treasurer would say, you

are to receive but fifty dollars, the other fifty are reserved for the

original holder. Now, if I was to go and tell the officer, that,

notwithstanding my purchase of all his right, title, and claim to the

one hundred dollars, the Government would give me but fifty, retaining

the other fifty for him, he would answer, I will never receive a

farthing of it, because it is your money, fairly and honorably purchased

of me. Now, in this case, what would you do? Should these fifty dollars

fall to the Government, or to me? I reason in this manner, because I

suppose this would be a general case. The Society of Cincinnati, of the

State of New York, have, by a resolution, which they have published in

the papers, disavowed the principle; and, in Rhode Island, a member of

the Society was expelled for taking advantage of the tender-law of that

State, and paying off a _bona fide_ debt with depreciated paper. I

apprehend the principle of action still remains the same throughout the

whole of the army. When the soldier conveyed his certificate, there was

a contract between the parties, that whatever sum the Government could

pay, the whole of it should go to the assignee. Now, by an act of

violence, you take the half of it away, and enable the assignor to

discharge the contract by paying fifty dollars, when he had engaged that

the purchaser should receive one hundred. This is, in effect, the same

as the payment of depreciated paper under a tender-law, and would be

equally rejected by those whom it is intended to favor.

I would state the case, as if it had happened between the gentleman and

myself, could he hesitate to say the whole sum was fairly mine, and

surrender it up, notwithstanding the legal interference of the

Government? This is a question I would not suffer myself to reason upon;

I would not trust my mind with it, lest it should preponderate in favor

of self-interest, though against the common principles of truth and

justice. I cannot think the army would accept the interposition; we

ought, therefore, to be cautious how we trifle with the honor of other

people.

I do not pretend to say, that the persons intended to be relieved by the

proposed scheme have not a claim against the United States; but I deny

that it is a claim upon our equity or justice; it may be a claim upon

our humanity; and, whether we will satisfy this claim, depends on

circumstances which have no connection with the present question.

Mr. JACKSON.--God forbid, Mr. Chairman, that I should trifle with the

honor of men I value, and esteem so highly; it would be the last thing I

could think of. But, sir, as a Legislator, I cannot consent that the

pittance which was the reward of distinguished services, shall be torn

from them by the arts of insidious speculators; but there are others,

who have a claim in equity upon our justice, who ought not to be

sacrificed to the soldier's honor.

Mr. WHITE said he agreed with the gentleman from Massachusetts (Mr.

SEDGWICK) in the principle, that if a contract is made for a valuable

consideration, and with the understanding of both parties, the

Legislature ought not to interfere in it; and should it appear that the

transaction between the original holders of certificates and the

purchasers was a fair one, the dispute, in his mind, was at an end. But

no gentleman had attempted to show that this was the case, though all

the arguments against a discrimination were founded on that supposition.

Perhaps it might be said, that every argument ought to be considered as

fair; unless the contrary be proved. But where one man has obtained the

property of another to the amount of £100 for £10, or £12 10s. the

transaction must be explained to him, before he would believe it to be

honest. What is the present case? The original holders, who have parted

with the evidences of their debts, were principally common soldiers,

militiamen, and farmers in indigent circumstances. Who were the

purchasers? The Secretary of the Treasury tells us, that the most

enlightened among our citizens are the creditors of the United States;

common soldiers cannot be comprehended in this description. What must

have passed, he asked, between the soldier, the militiaman, or farmer,

and the purchaser? What reason could the purchaser assign for offering

£10 for a paper which specified an obligation to pay £100? It must be

something like this--the States will never pay you; if they do, it will

be at a very remote period, so long as to be useless to you; but to

relieve your present necessities, I will take the risk on myself, and

give you £10. Now, could any enlightened man, he asked, in 1783, or at

any subsequent period, in which time the transfers took place, believe

that the independence of America was in danger, or that the debts could

not be provided for?

He knew so many instances of transactions like that which he had stated,

that he doubted not the greater part of the certificates had been

obtained by similar means. Indeed he could not conceive any other by

which they could be obtained.

He said we were, perhaps, without a precedent in any other nation which

would be strictly applicable; but he desired gentlemen to determine for

themselves, whether, under such circumstances, the man who had rendered

services to his country should be deprived of his reward, or whether the

purchaser ought to receive it. He said it was very different in the

common transactions of life. If a man purchased a tract of land for

£1,000, paid the money, and took a bond for the conveyance, a third

person, by informing the purchaser that the seller could not make a

title, or by other false suggestions should obtain a transfer of the

bond in consideration of £100, and get a conveyance and possession of

the land, yet, on repaying the £100, the conveyance would be set aside,

and he would be restored to his land.

He gave some other instances of a similar nature, and said, he believed,

if a bond, whether due, or to become due, was assigned under such

circumstances, that the obligee would be justifiable in contesting it in

a court of law, and that the injured person would, on application,

obtain redress. He said, that in cases of extreme hardship, Courts of

Equity would give relief without express proof of fraud; that this was

the law of Great Britain, and was agreeable to the principles of the

civil law; that the Roman jurists, he believed, had fixed the point of

extreme hardship to one half of the value of the property transferred;

in England the court was to judge.

He said he did not think the present holders were strictly entitled to

any thing more than the original purchasers; that here the maxim, quoted

on the other side of the question, that the assignee stands in the shoes

of the assignor, properly applied. You cannot place another on more

advantageous ground than that on which you stand yourself. The plea of

an innocent purchaser could not take place; the nature of the

transaction must appear evident to every man concerned in the transfer.

He said the reverse of this did not hold. An assignee was not always in

as advantageous a situation as the assignor; and instanced the case of

an executor who should obtain the assignment of his testator's bond at

an undervalue; and who, he said, could not retain in his hands the

amount of the sum specified in the bond, which the creditor might have

recovered, but only the sum which he actually paid for the bond.

He said, that, though in his opinion the present holders of certificates

were strictly entitled to no more than what had been paid to the

original holders, yet, as an investigation of that circumstance would be

involved in inextricable difficulties, and since we were (as had been

very properly observed and well expressed by a gentleman from South

Carolina) settling the business of a family, he was willing to acquiesce

in the motion of his colleague. He said, that arbitrators often gave the

injured party less than his due, for peace sake; and he was willing to

act on the same principle. He doubted not but courts of justice would

give relief in particular cases; but in a matter of that magnitude, he

thought the interference of the Legislature very proper. The South Sea

business, he thought, in that respect, a good precedent. Two gentlemen

had mentioned the business; he would not say they had misstated the

transaction, but he thought their accounts imperfect. They said they had

the documents under their hands; he wished they had been read; he had

them not, but would state from memory what he thought applicable to the

case in question. The directors of the South Sea Company, by various

arts, induced the people to give as high as £1,000 for £100 stock; in

many instances the money was paid, in others it was contracted to be

paid. A gentleman has said, that Parliament interfered, not to violate,

but to perfect the contract: but what did Parliament do? They

confiscated the estates of the directors, and applied the amount to the

relief of those who had actually paid their money, and suspended suits

against those who had not paid; and authorized the debtors to discharge

their debts by the payment of ten per cent. on the real value of the

stock subscribed for. But if he was wrong in supposing the present

holders ought to stand in the place of the first purchasers, they could

be considered only as having purchased, in market, a paper of indefinite

value; if, then, they get the highest market price, they are not

injured.

He would now endeavor to obviate some of the objections to the measure,

on account of its impracticability; and in general terms observed, that

much greater pains had been taken to show the impracticability than the

injustice of it. He said, if it was just, we ought to adopt it; and he

did not doubt but the wisdom of the Legislature would be able to carry

it into effect. Purchasers, he said, had been represented as the

supporters of public credit; but he could not consider them in that

light. The offering a tenth or an eighth part of the value of the bond

of an individual would tend rather to blast his credit than to support

it; it would have the same effect with respect to the public.

He said he had lived long enough to be convinced that wise and great

men, having the same object in view, often differ in opinion with

respect to the means of accomplishing it; therefore, every proposition

ought to be treated with candor and respect. He made that observation in

consequence of what passed yesterday. A gentleman from Massachusetts had

introduced his speech in a manner somewhat new--with an apology for an

impropriety which he _intended to commit_. He pursued the arguments of

those who went before him, in opposition to the amendment; but his

speech consisted principally in an effusion of opprobrious epithets,

some of which he repeated, and said, to detail the whole would perhaps

fill half a column of a newspaper. He said he felt, on the occasion, not

for himself, for he had not expressed his sentiments on the subject

under debate, but for the honor of the House, in which, he thought, no

such language ought to be used.

It had been said we came forward as volunteers; that the original

holders did not put in their claim. That might be easily accounted for;

they were generally obscure and indigent; had too much modesty, or

perhaps not the capacity, to come forward. That he believed the crowd in

the gallery did not consist of original holders.

Mr. HARTLEY.--I do not wish to trespass upon the time of the committee,

but I cannot consent to give a silent vote on this occasion. I mean,

however, to confine myself to a few observations, as many of my ideas

have been communicated by other gentlemen. The honorable gentleman from

South Carolina (Mr. SMITH) has anticipated much of what I had to urge; I

shall therefore reduce my view of the subject to two points; first, as

to the justice or legality of the measure, in obliging a creditor, or

assignee, to take less than a certificate expresses, and pay the

difference to another: second, as to the practicability or policy of the

motion and its consequences.

As to making further satisfaction to the officers and soldiers of the

late army, who have sold their certificates for an inconsiderable sum,

and who have in consequence reaped a less reward than the Government

contracted for, and intended them, I conceive it has nothing to do with

the present question. However, if there is a disposition in Congress to

make a further compensation to those brave and meritorious men, I would

be among the first to support the measure; but I think this a subject

too momentous to be involved collaterally in the question now under

consideration.

With respect to the first point that offers itself, I have to remark,

that a man who enters into a contract should know the consideration, and

understand the principles upon which it is made, and these should be

expressed on the face of the evidence of the contract. Now, if this

contract be of a negotiable nature, the person to whom the same is

offered, looks on its face, from which it discovers the _agrementum_,

and is naturally led to consider the circumstances of the debtor, his

ability and integrity. Suppose even the evidence of the contract to be

obtained by fraud, unless it be against the express provision of a

statute, and is transferred to a third person for a valuable

consideration, without notice of fraud, it, must be paid. A fraud in any

link of the chain is corrected by a _bona fide_ transfer for a valuable

consideration, without a knowledge of that circumstance by the

purchaser.

Now, let us apply these principles to the present case. Here is an

instrument of writing, specifying a debt to be due from the United

States to the original holder, or bearer; this being brought into

market, is offered to a third person, he, before his purchase, sees that

the contract was executed in consequence of a consideration, and not

against any positive statute; he then inquires the ability of the

Union, and its disposition to comply with the contract; and, from a

consideration of these circumstances, he concludes, with respect to his

own interest and safety in the purchase, and pays what is conceived to

be the value. What is there to discharge the Government from the

payment? Is it pretended that the services and supplies were an

inadequate compensation? If it even was so supposed, it would not

authorize us to refuse a compliance with our engagements; any

interference would set afloat the great principle upon which the public

tranquillity and happiness depend. This leads me to consider the subject

in my second point of view, with respect to its policy and

practicability, and the consequences that would result from the attempt.