CONGRESS was summoned to meet in extra session September 19,
by a proclamation issued August 8, before the capture of Washington.
On the appointed day the members appeared, but found their building
in ashes, and met like vagrants, without a shelter they could call
their own. The President caused the only public office that had been
spared, to be fitted for their use. Partly owing to the exertions of
Dr. Thornton, the head of the Bureau of Patents, partly owing to the
tornado of August 25, the building used as Post and Patent Office was
not burned. There Congress was obliged to hold its sessions, in such
discomfort as it had never before known.
The President sent his Annual Message September 20, which informed
Congress that it had been specially summoned to supply “any inadequacy
in the existing provision for the wants of the Treasury,” as well as
to be ready for whatever result might be reached by the negotiation
at Ghent. Two thirds of the Message related to the operations of war,
and the President seemed rather disposed to suppress than to avow his
difficulties, but the little he said of them was heavy with anxiety.
He announced that July 1 five million dollars remained in the Treasury,
and that “large sums” must be provided; but he did not add that the
loan had failed, or that the banks and Treasury had suspended specie
payments. He did not say that the regular army and the militia system
were inadequate to national defence; but he declared “the necessity of
immediate measures for filling the ranks of the regular army,” and of
giving “the requisite energy and efficiency” to the militia:--
“From this view of the national affairs Congress will be urged
to take up, without delay, as well the subject of pecuniary
supplies as that of military force, and on a scale commensurate
with the extent and the character which the war has assumed. It
is not to be disguised that the situation of our country calls
for its greatest efforts.... From such an adversary, hostility
in its greatest force and in its worst forms may be looked for.”
The President threw on the Secretaries of the Treasury and of War the
ungrateful task of announcing the details of their need. Secretary
Campbell was first to address Congress, and the tone of his report on
the state of the finances received emphasis from the resignation which
he sent at the same time to the President. Campbell’s annual report of
September 23 was an admission of incompetence. He had paid, he said,
nearly twenty millions from the Treasury between January and July;
twenty-seven millions more were payable between July and the following
January. For the year 1815 the Treasury would require at least as
much as for 1814. Congress must therefore speedily provide at least
seventy-four millions for the service between July 1, 1814, and Dec.
31, 1815. He ventured to suggest no means of obtaining this sum, or any
amount approaching it.
July 1 the Treasury contained $4,722,000. From its various sources of
revenue it could expect $4,840,000 during the remainder of the year;
from loans already contracted, $4,320,000. In all, $13,822,000 might be
considered as in hand, which was one half the sum immediately required.
For the year 1815 the revenue in all its branches might produce
$8,200,000, leaving $39,000,000 to be provided. Twenty-two millions
were the extent of Campbell’s resources, but fifty-two million dollars
more must be raised merely to carry on the government as it had been
administered in the past year.
The plan of finance adopted by Gallatin at the outset of the war
assumed that all deficits could be covered by loans.
“The experience of the present year,” said Campbell, “furnishes
ground to doubt whether this be practicable, at least in the
shape in which loans have hitherto been attempted. Nor is it
even certain that the establishing and pledging of revenues
adequate to the punctual payment of the interest and eventual
reimbursement of the principal of the sums which will be
required for the year 1815, would enable the Treasury to obtain
them through the medium of loans effected in the ordinary way.”
Loans being impracticable, Campbell discussed the possibility of using
Treasury notes. Eight millions were already in issue, and of these
more than four millions would fall due before December 31. Campbell
considered that six millions in Treasury notes was about as large
a sum as could easily be circulated, but by issuing notes of small
denominations he hoped to raise the amount to ten millions.
From all sources Campbell hoped to obtain about twenty-four million
dollars of the seventy-four millions required. For the remaining
fifty millions he had no suggestion to offer. The means for new and
extraordinary exertions, he said, “ought to be provided.” He declared
that the resources of the nation were ample,--which was true, but was
also the most discouraging symptom of the time; for if the people,
with ample resources, as he asserted, refused to come to the support
of their own government on any terms, their decision must be accepted
as final. Besides throwing upon Congress all these difficulties,
without a suggestion of his own, Campbell added that Congress would be
required to exert its powers to remedy the evils of the currency and
the suspension of specie payments.
Congress on hearing this financial statement regarded the situation
as desperate. “Tell Dr. Madison,” Senator Lacock was reported[354]
to have said to the President’s private secretary, “that we are now
willing to submit to his Philadelphia lawyer for head of the Treasury.
The public patient is so very sick that we must swallow anything,
however nauseous.” Dallas was nominated October 5, and confirmed the
next day without opposition, as Secretary of the Treasury. No stronger
proof could have been given of the helplessness of Congress, for Dallas
was a man who under no other circumstances could have obtained a ray of
popular favor.
Dallas’s character was high, his abilities undoubted, his experience
large; but for ten years he had been one of the least popular men
in Pennsylvania, the target of newspaper abuse and the champion of
political independence. The people reasonably required that their
leaders should more or less resemble some popular type, and if the
result was monotonous the fault was in the society, not in its politics
or its politicians; but Dallas was like no ordinary type in any people.
His tone of intellectual and social superiority, his powdered hair,
old-fashioned dress and refined manners, his free habits of expense,
and the insubordination even more than the vivacity of his temper
irritated the prejudices of his party.[355] He had little respect
for Presidents, and none for Congress. For Jefferson and Virginia
doctrines he felt distrust, which was returned. Earnest in temper and
emphatic in tone, even to the point of tears and tropical excitability,
Dallas came to Washington as though to lead a forlorn hope,--caring
little for parties and less for ambition, but bent upon restoring to
the government the powers that his friend Gallatin, too easily as he
thought, had allowed to slip from its grasp.
The difficulties of the Treasury when Dallas took charge of it were
not easily exaggerated. His own description,[356] given some six weeks
afterward, made no disguise of them. “The Treasury,” he said, “was
suffering under every kind of embarrassment. The demands upon it were
great in amount, while the means to satisfy them were comparatively
small, precarious in collection, and difficult in their application....
The means consisted, first, of the fragment of an authority to borrow
money when nobody was disposed to lend, and to issue Treasury notes
which none but necessitous creditors or contractors in distress ...
seemed willing to accept;” second, of bank-credits, chiefly in the
South and West, rendered largely useless by the suspension of specie
payments; third, of the current receipts of taxes, also useless because
paid chiefly in Treasury notes. The Treasury was bankrupt. The formal
stoppage of payments in interest on the debt was announced, November
9, by an official letter from the secretary, notifying holders of
government securities in Boston that the Treasury could not meet its
obligations, and that “the government was unable to avert or to control
this course of events.”[357] After that date the Treasury made no
further pretence of solvency.
From this situation the government could be rescued only by a great
effort; and obviously the currency must be first restored, for
until some system of exchange could be established, every increase
of taxation would merely increase unavailable bank deposits. Fifty
millions of Southern bank-notes, locked in the vaults of Southern
banks, would not pay the over-due interest on government bonds at
Boston.
To this subject every one turned, but the schemes that seemed to have
a chance of adoption were only two. The first came from President
Jefferson, and was strongly pressed by the South. As Jefferson
explained it, the plan seemed as simple as his plans were apt to
be; he proposed to issue twenty millions in promissory notes every
year as long as might be necessary. “Our experience,” he told the
President,[358] “has proved it [a paper currency] may be run up to two
or three hundred millions without more than doubling what would be the
prices of things under a sufficient medium, or say a metallic one.” His
plan included an increase of taxation by two million dollars every year
to redeem the same amount of Treasury issues.
Obviously the insuperable obstacle to this plan was the paper money
of the State banks, which already stood at discounts varying from ten
to fifty per cent in specie, and in any large quantity could not be
discounted at all. Until private paper should be abolished, public or
government paper could not be brought into common use. Jefferson’s
views on this, as on the whole subject, were interesting.
“The banks have discontinued themselves,” he explained.[359]
“We are now without any medium; and necessity, as well as
patriotism and confidence, will make us all eager to receive
Treasury notes if founded on specific taxes. Congress may now
borrow of the public, and without interest, all the money they
may want, to the amount of a competent circulation, by merely
issuing their own promissory notes of proper denominations for
the larger purposes of circulation, but not for the small. Leave
that door open for the entrance of metallic money.... The State
legislatures should be immediately urged to relinquish the right
of establishing banks of discount. Most of them will comply on
patriotic principles, under the convictions of the moment; and
the non-complying may be crowded into concurrence by legitimate
devices.”
Instead of “banks of discount,” Jefferson probably meant to say banks
of issue, although the Virginia school was hostile to all banks, and
possibly he wished to destroy the whole system. If the scheme were
adopted, twenty million dollars in paper money would not supply the
wants of the Treasury, which required at least fifty millions within a
year. The resource was limited, even if the States could be compelled
to stop the issue of private notes,--which was extremely doubtful in
the temper of Massachusetts and with the leanings of Chief-Justice
Marshall. Jefferson did not touch upon legal tender; but the assumption
of power implied in the issue of paper money seemed to require that
the government should exercise the right of obliging its creditors to
accept it. The actual interest-bearing Treasury notes stood then at
a discount of about twenty per cent. The proposed paper money could
hardly circulate at a better rate, and coin was not to be obtained.
Under such conditions the notes must be a forced currency if they were
to circulate at all.
The scheme was reported to the House by the Committee of Ways and Means
through its chairman, John W. Eppes, Jefferson’s son-in-law.[360] For
the report Eppes was alone responsible, and the plan in his hands
varied in some points from that of Jefferson. Starting from the
admitted premise that loans were not to be obtained, and that money
could not be transferred from one point to another in any existing
medium at the disposition of government, Eppes proposed to issue
Treasury notes “in sums sufficiently small for the ordinary purposes
of society,” which were not to be made payable on demand in coin, but
might at any time be exchanged for eight per cent bonds, and were to
be received “in all payments for public lands and taxes.” Nothing was
said of legal tender, or of driving bank-notes from circulation; but
Eppes proposed to double the taxes at one stroke.
Eppes’s scheme lost the advantages of Jefferson’s without gaining any
of its own. It abandoned the hope of abolishing bank paper; and in want
of such a restraint on private issues, the proposed government paper
would merely add one more element of confusion to the chaos already
existing. Eppes further altered Jefferson’s plan by adding some ten
millions instead of two millions to the burden of taxation; but even
Jefferson protested that this part of the scheme was impracticable.
“This is a dashing proposition,” he wrote to Monroe;[361] “but
if Congress pass it, I shall consider it sufficient evidence
that their constituents generally can pay the tax. No man has
greater confidence than I have in the spirit of the people to
a rational extent. Whatever they can, they will. But without
either market or medium, I know not how it is to be done. All
markets abroad and all at home are shut to us, so that we have
been feeding our horses on wheat. Before the day of collection,
bank-notes will be but as oak-leaves; and of specie there is not
within all the United States one half of the proposed amount of
the taxes.”
This was the situation of the Virginia scheme when Dallas took the
matter in hand. Immediately after entering into office, Dallas wrote to
Eppes an official letter, dated October 17, expressing views wholly at
variance with the Virginia plan.
“Under favorable circumstances and to a limited extent,” he
said,[362] “an emission of Treasury notes would probably afford
relief; but Treasury notes are an expensive and precarious
substitute either for coin or for bank-notes, charged as they
are with a growing interest, productive of no countervailing
profit or emolument, and exposed to every breath of popular
prejudice or alarm. The establishment of a national institution
operating upon credit combined with capital, and regulated by
prudence and good faith, is after all the only efficient remedy
for the disordered condition of our circulating medium. While
accomplishing that object, too, there will be found under the
auspices of such an institution a safe depository for the public
treasure and a constant auxiliary to the public credit. But
whether the issues of a paper currency proceed from the national
Treasury or from a national Bank, the acceptance of the paper in
a course of payments and receipts must be forever optional with
the citizens. The extremity of that day cannot be anticipated
when any honest and enlightened statesman will again venture
upon the desperate expedient of a tender-law.”
Without a tender-law the Virginia scheme would hardly answer the
purposes required, since the government must restrain the issue of
paper within a limit too narrow for usefulness. Dallas did not press
this point, but developed his own scheme, which required, like that of
Eppes, a duplication of taxes to produce twenty-one million dollars,
and the creation of a national Bank with a capital of fifty million
dollars.
Either Eppes’s or Dallas’s plan might answer the immediate object
of providing a currency, and both required the exercise of implied
powers by Congress. Apparently Congress had only to choose, but in
truth choice was most difficult. The House readily adopted Dallas’s
recommendation in principle, and voted, October 24, by sixty-six to
forty, that it was expedient to establish a national Bank; but the
problem of establishing a specie-paying bank without specie passed
its powers. Dallas abandoned the attempt at the outset. He proposed a
bank of fifty millions capital, of which forty-four millions might be
subscribed in government bonds and Treasury notes, and six millions in
coin. The bank was at once to lend to government thirty millions,--of
course in bank-notes,--and no one denied that an immediate suspension
of specie payments must follow such an issue. To any bank, strong or
weak, the old Virginia influence represented by Eppes was hostile; and
to a bank insolvent from the start the Federalists also were opposed.
When the bill, reported November 7, was printed, it was found to
contain a provision authorizing the suspension of specie payments at
the President’s discretion. The discussion began November 14, and
every successive day revealed objections and increased the opposition.
Calhoun complicated the subject still further by bringing forward,
November 16, a plan of his own, requiring the capital to consist “one
tenth in specie, and the remainder in specie or in Treasury notes to
be hereafter issued,” and taking away all government control. Ingham
of Pennsylvania, representing Dallas, combated Calhoun with force, but
could not make his own measure agreeable to the House. His phrase in
regard to the suspension of specie payments was significant. Congress,
he said, would be to blame for “frantic enthusiasm” if it did not
provide for the case. “It may happen, and probably will happen, that
their specie payments cannot be continued, and what will then be
the situation of the bank? Failing to fulfil the purposes designed,
its credit is blighted, its operations are stopped, and its charter
violated; and if this should take place before your Treasury notes are
sold, the government will scarce obtain a moment’s relief.” That the
new bank could not pay specie was obvious. The Bank of England itself
could not pay specie, and had not attempted to do so for nearly twenty
years.
The House in committee adopted Calhoun’s amendment by a majority of
about sixty, in spite of Ingham’s opposition; and thus substituted for
Dallas’s scheme a large private bank, over which the government was
to exercise no control, with a capital of fifty millions, nine tenths
of which were to be Treasury notes. The House then discovered so many
unforeseen difficulties, that November 25 it recommitted the bill to a
select committee, of which Lowndes, Calhoun, Ingham, Forsyth, and two
Federalists were members.
Dallas was obliged openly to enter the lists against Calhoun, and
wrote to the committee a letter, dated November 27,[363] sounding like
a defiance: “The dividend on the funded debt has not been punctually
paid; a large amount of Treasury notes has already been dishonored;
and the hope of preventing further injury and reproach in transacting
business with the Treasury is too visionary to afford a moment’s
consolation.” Calhoun’s scheme, he plainly intimated, was impracticable
and mischievous.
The next day, November 28, Lowndes brought back Calhoun’s bill to
the House, together with Dallas’s letter, and told the House that
the committee could come to no agreement. Upon this admission of
helplessness, Hanson addressed the House in a speech which seemed to
carry Federalist exultation to the extremest point. Protesting his
anxiety to defend the country, Hanson uttered a cry of triumph over the
destruction of the government:--
“Not only had government bills been dishonored and the interest
of the public debt remained unpaid, but ... so completely
empty was the Treasury and destitute of credit, that funds
could not be obtained to defray the current ordinary expenses
of the different Departments. Disgraceful, humiliating as the
fact was, it ought not to be concealed from the nation, and he
felt it his duty to state to the House that the Department
of State was so bare of money as to be unable to pay even
its stationery bill. The government was subsisting upon the
drainings of unchartered banks in the District, which felt
themselves compelled to contribute their means lest the rod
_in terrorem_ which was held over them should be applied,
and an Act of incorporation refused.”
No one contradicted or answered Hanson. The House wavered in incapacity
that suggested dissolution. At last Richard M. Johnson, in order to
force a decision right or wrong, moved the previous question and
brought the House to a vote. Then the majority turned against Calhoun,
as they had before turned against Dallas, and rejected the bill by a
vote of one hundred and four to forty-nine.
The Southern preference for government paper currency lay at the bottom
of Calhoun’s scheme as of Jefferson’s, and seemed to Dallas to combine
ignorance with dishonesty. Treasury notes bearing interest could not
be made to serve as a currency, and were useless as a foundation for
government paper. “What use is there,” asked Ingersoll,[364] “in such
a mass of banking machinery to give circulation to some millions of
Treasury notes? Why not issue them at once without this unwieldy, this
unnecessary medium?” Yet when Bolling Hall of Georgia, in pursuance of
Macon’s aphorism that “paper money never was beat,” moved, November 12,
Resolutions authorizing the issue of Treasury notes as legal tender,
the House refused to consider it by a vote of ninety-five to forty-two.
Eppes did not vote; Calhoun voted against it, and of the twenty-five
Southern members who supported it Macon and Stanford were the most
prominent.
Nothing could be plainer than that the House must ultimately come to
inconvertible government paper, whether issued by the Treasury or by
a Bank. Dallas, Eppes, and Calhoun were all agreed on that point, if
on no other; but after Congress had sat two months and a half, the
House was no nearer a decision than when it met. The Federalists,
voting at one time with Calhoun, at another with Dallas, were able to
paralyze action. Eppes wrote to Dallas, December 2, inviting further
information; and Dallas wrote back the same day, recounting the needs
of the Treasury for the current month, merely on account of the
national debt. Dallas reported that $5,726,000 in Treasury notes and
dividends were due, or would fall due by January 1; and that including
unavailable bank-credits, and subject to possible contingencies,
the Treasury might contain resources to meet these demands to the
amount of $3,972,000.[365] Eppes could do no more for immediate
relief than report a bill for the issue of some ten millions more of
interest-bearing Treasury notes, which was passed without debate and
became law, December 26, without improving the situation.
The House also passed the heavy tax-bills without much opposition
except from Federalists who wished to stop military operations on the
part of the government. Between thirty and forty members, or about one
half of the Federalists, carried their opposition to that point. The
bill raising the direct tax to six million dollars passed the House,
December 22, by a vote of one hundred and six to fifty-three, and
passed the Senate, January 5, 1815, by twenty-three to seven. Dallas
and Eppes hoped to raise about twenty million dollars through the new
taxation, or twice what had been previously attempted. Jefferson held
that these taxes could not be paid, and expressed his opinion without
reserve.
“If anything could revolt our citizens against the war,” wrote
Jefferson, November 28,[366] “it would be the extravagance with
which they are about to be taxed.... The taxes proposed cannot
be paid. How can a people who cannot get fifty cents a bushel
for their wheat, while they pay twelve dollars a bushel for
their salt, pay five times the amount of taxes they ever paid
before? Yet this will be the case in all the States south of the
Potomac.”
If any conclusion was intended to be drawn from the official
return[367] sent to Congress, October 13, of internal taxes received
to that date in each State, the evil predicted by Jefferson seemed
already to exist. In Massachusetts, of taxes to the amount of
$200,000, accrued for the first two quarters of the year, $170,000 had
been received before October 10. In New York $393,000 had accrued, and
$303,000 had been received; thus New York was nearly one fourth in
arrears. Pennsylvania was worse; of $470,000 accrued the government
had received $280,000,--leaving two fifths in arrears. Virginia was
in somewhat worse condition than Pennsylvania; of $247,000 accrued
$136,000 had been paid,--leaving four ninths in arrears.
Yet Pennsylvania and Virginia paid taxes in their own depreciated bank
paper, while New York and New England paid chiefly in Treasury notes.
The new taxes were still to be paid in the same medium, although the
laws gave no express authority for it. In the next Congress, when the
subject was discussed, Wright of Maryland said:[368] “When Congress
passed the revenue laws and imposed the six million and three million
land tax, did they contemplate the payment of specie? No! they knew
the people had it not, and of course could not pay it.... Does any man
doubt that Congress intended these taxes being paid in bank paper? Nay,
has not the Secretary of the Treasury ... sealed this construction
of the law by taking the bank paper in discharge for these taxes?”
That the bank paper was worth less than Treasury notes was shown
by the Southern States paying their taxes in such paper, when they
might equally well have paid them in Treasury notes except for the
difference in value.
The medium of depreciated and depreciating bank paper in which the
taxes were to be paid, secured the States outside of New England from
intolerable pressure by giving the means of indefinite depreciation;
but to the government such a resource meant merely a larger variety
of bank-credits, which were of no certain value even in the towns
where the banks existed, and were of no value at all elsewhere. The
burden of taxation would be thrown chiefly on New England; and if the
Hartford Convention did nothing else, it was sure to take measures
for sequestering the proceeds of taxation in New England for military
purposes. The hope of restoring the finances by taxation was faint.
Until the currency could be established and exchanges made secure, the
government was helpless.
The House having broken down November 28, the Senate next took the
matter in hand. Rufus King reported, December 2, a bill to incorporate
a bank, which was in effect the bill recommended by Dallas. After a
week’s consideration the Senate passed the bill, December 9, by the
vote of seventeen to fourteen,--King and the Federalists, with four
Republican senators, voting against it. The House referred it to the
Committee of Ways and Means, which reported it, December 14, with
amendments. The debate began December 23, and was cut short December 27
by C. J. Ingersoll, who by the close vote of seventy-two to seventy
obliged the House to call for the previous question, and order the bill
to its third reading. This energy was followed by a reaction; the bill
was recommitted for amendment, again reported, and vehemently attacked.
Never had the House shown itself more feeble. The Federalists took the
lead in debate; and January 2 Daniel Webster, in a speech that placed
him at the head of the orators of the time, dictated the action of
Congress:--
“What sort of an institution, sir, is this? It looks less like a
bank than like a department of government. It will be properly
the paper-money department. Its capital is government debts;
the amount of issues will depend on government necessities;
government in effect absolves itself from its own debts to the
bank, and by way of compensation absolves the bank from its own
contracts with others. This is indeed a wonderful scheme of
finance. The government is to grow rich because it is to borrow
without the obligation of repaying, and is to borrow of a bank
which issues paper without the liability to redeem it.... They
provide for an unlimited issue of paper in an entire exemption
from payment. They found their bank in the first place on the
discredit of government, and then hope to enrich government out
of the insolvency of the bank.”
Webster was a master of antithesis, and the proposed bank was in effect
what he described; but had he been a member of the British Parliament
he might have made the same objections, with little alteration, to
the Bank of England. The Hartford Convention was in session while he
spoke. Every word of his speech was a shock to the government and the
Union, for his only suggestion was equivalent to doing nothing. He
moved to instruct the committee to report a bill creating a bank with
thirty millions of capital, composed one fourth of specie and three
fourths of government securities; without power to suspend specie
payments, and without obligation to lend three fifths of its capital
to the government. To such a bank he would give his support, “not as a
measure of temporary policy, or an expedient to find means of relief
from the present poverty of the Treasury,” but as an institution most
useful in times of peace.
The House came to a vote the same day, and divided eighty-one to
eighty. Then the Speaker, Langdon Cheves, rose, and after denouncing
the proposed bank as “a dangerous, unexampled, and he might almost say
a desperate resort,” gave his casting vote against the bill.
No sooner had the House struck this blow at Dallas than it shrank
back. The next day, amid complaints and objections, it reconsidered
its matured decision by the sudden majority of one hundred and seven
to fifty-four. Once more the bill was recommitted, and once more
reported, January 6, in the form that Webster proposed. Weary of their
own instability, the majority hastened to vote. Most of the Federalists
supported the bill; but Grosvenor of New York, one of the ablest,
frankly said what every one felt, that the proposed institution could
not be a specie bank, or get a million of its notes into circulation.
“The government relying on it would be disappointed, and ruin soon
stare them in the face.” With this understanding the House passed the
bill, January 7, by a vote of one hundred and twenty to thirty-eight;
and the Senate, after a struggle with the House, accepted it, January
20, by a vote of twenty to fourteen.
Dallas was not a man to be easily daunted even in so desperate a
situation. After ten days deliberation, the President sent to Congress
a veto message.
“The most the bank could effect,” said Madison, “and the most it
could be expected to aim at, would be to keep the institution
alive by limited and local transactions ... until a change from
war to peace should enable it, by a flow of specie into its
vaults and a removal of the external demand for it, to derive
its contemplated emoluments from a safe and full extension of
its operations.”
“I hope this will satisfy our friends,” wrote Webster to his
brother,[369] “that it was not a bank likely to favor the
Administration.” Either with or without such a bank, the Administration
was equally helpless. The veto left the Treasury, February 1, without
a resource in prospect. The unsatisfied demands reached nearly twenty
millions. The cash balance, chiefly in bank-credits, was little more
than six millions. A further deficit of forty millions remained
to be provided above the estimated revenue of 1815. United States
six-per-cents commanded only a nominal price, between fifty and sixty
cents on the dollar,[370] and were quoted in Boston at a discount of
forty cents.[371] Treasury notes being in demand for taxes, were worth
about seventy-five cents in the dollar. Dallas had no serious hope of
carrying on the government. In a letter to the Committee of Ways and
Means, dated January 17, he could only propose to add six millions more
to the taxes, issue fifteen millions in Treasury notes, and borrow
twenty-five millions on any terms that could be obtained. In making
these recommendations he avowed in grave words his want of confidence
in their result:[372]--
“In making the present communication I feel, sir, that I have
performed my duty to the Legislature and to the country; but
when I perceive that more than forty millions of dollars must be
raised for the service of the year 1815, by an appeal to public
credit through the medium of the Treasury notes and loans, I am
not without sensations of extreme solicitude.”
Young George Ticknor of Boston happened to be in the gallery of the
House of Representatives when Eppes read this letter, January 21, and
the next day he wrote,[373]--
“The last remarkable event in the history of this remarkable
Congress is Dallas’s report. You can imagine nothing like the
dismay with which it has filled the Democratic party. All his
former communications were but emollients and palliations
compared with this final disclosure of the bankruptcy of the
nation. Mr. Eppes as Chancellor of the Exchequer, or Chairman
of the Committee of Ways and Means, read it in his place
yesterday, and when he had finished, threw it upon the table
with expressive violence, and turning round to Mr. Gaston, asked
him with a bitter levity between jest and earnest,--
“‘Well, sir! will your party take the government if we will give
it up to them?’
“‘No, sir!’ said Gaston; ... ‘No, sir! Not unless you will give
it to us as we gave it to you!’”