_On a_ DISCRIMINATION _between the_ ORIGINAL HOLDERS _and the_
PURCHASERS _of the_ CERTIFICATES _of the_ UNITED STATES.
OBJECTION 1. It iz said that _public faith_ requires the payment of the
certificates, according to contract; that iz, to the bearers. Let me ask
the men who contend for promise, what they meen by _public faith_? Did
the public ever promise to do rong? The money waz du to men who erned
it; the money waz not paid. The full valu expressed on the certificates
waz du, and the certificates were worth but a fourth, or perhaps an
eighth part of that valu. The public promised the creditors their full
demands; but theze promises, at the time of issuing the certificates,
were actually worth but a small part of that demand. Ought the creditors
to be dismissed with this part of their money, and then compelled to pay
the full valu of the certificates to their nabors, who purchased them at
their current price? If this iz right, my ideas of justice are _rong_.
Public faith iz suppozed to be founded on justice. The public engaged to
do justice to its creditors; but this justice _haz_ not been done; and
it appeers to me az plain az the shining of the sun, that if the
certificates should be paid to the bearers, justice _wil_ not be done.
The creditors at the time of contract, expected to receev gold and
silver, or something equivalent; they hav receeved neether the one nor
the other. They receeved articles which were worth but a fourth part of
their demands; for the remainder of their money, the public iz stil
their detor. Public faith therefore requires, that the full valu of the
alienated certificates should not be paid to the bearer. It appeers to
me that the principles of equity, rather than of law, should decide this
important question. It iz the design of the contract, not the words,
which should be pursued; for it must be remembered, that the design of
the public haz been counteracted. The intention of the public, expressed
on the certificates, haz been defeated by the public exigences; and to
pursue the words of the engagement, wil now produce an effect which waz
not designed, viz. _extensiv injustice_.
In this situation the public haz an undouted right to call in the
evidences of the det, and form a system that shall be effectual in the
distribution of justice. If the public suppoze that any arrangement for
this purpoze can be made, they certainly hav a right to attempt it; for
the object of the attempt would be public justice. The sticklers for
paying the det to the present holders, hav the same object in view,
_national faith_; but their ideas of this faith, seem to be derived from
the practice of other nations, the situation of whoze dets bears very
little analogy to that of ours. They therefore advance an argument
against their own cauze; for the faith of the public iz prezerved by
fulfilling _the intention_, rather than the _words_, of the contract.
Every dollar of old continental currency, promises a Spanish milled
dollar. This promise waz founded on the supposition that the valu would
be neerly the same, or waz designed to prezerve the valu. But the
depreciation of that currency, by the enormous sums in circulation,
rendered the fulfilment of the promise impracticable; and had it been
attempted, it would hav thrown the united states into confusion. The
redemption of the bills, at their nominal valu, would hav done justice
to a few, whoze money had depreciated in their hands, but would hav
ruined fifty times the number. Thoze who lost their property by
continental bills, ought to be indemnified, if the persons and sums lost
could be ascertained; but this iz impossible. The case of the
certificates iz different. Theze are promissory notes, expressing the
sums du, and the persons names to whom they were given. If in some
instances the purchasers hav returned alienated certificates to the
office, and taken out new ones in their own names, stil the public books
may remedy this inconvenience.
2. But it iz said the creditors of the public parted with their
certificates voluntarily. It waz at their own option, whether to keep
them or not; and if they choze to alienate them at a discount, the
public iz not responsible for the loss. _A_ owes _B_ 100l. he cannot
make immediate payment, but haz property to secure _B_, who takes a
promissory note. _B_ wants the money, and rather than wait for _A_'s
ability to pay it, he assigns the note to _C_ for 50l. In this case, _A_
cannot refuse to pay the full sum of 100l. because _C_ gave but fifty
for the note. This reezoning iz applied to the case of the public det;
and yet a skool boy ought to be ashamed of the application. The case iz
not parrallel, and the reezoning iz defectiv and inapplicable in every
particular.
In the first case, it iz not tru that the alienation of the certificates
waz a voluntary act; but in most cases, waz an act of necessity. Most of
the original creditors were ether _rich_ men who loaned money, or poor
men who did personal service. In many instances, thoze who loaned money,
loaned all their estates; and when they found no provizion made for
paying the interest, or when the interest waz paid in paper of less valu
than specie, they were left destitute of the meens of subsistence. Some
of theze hav been obliged to part with their certificates at a great
loss. But a large number of creditors were poor peeple, who had little
or no property, but their certificates, who had performed service, and
were under a necessity of negociating them on az good terms az they
could. Most of the alienations hav therefore been a necessary
consequence of public delinquency. Many of the creditors hav experienced
a degree of distress, which, in a court of chancery, would entitle them
to a consideration and redress. When a number of losses iz so great az
to effect the public, the legislature then becumes a court of equity,
where the sufferers must seek reparation. The legal principle must be
suspended, and special provision made for this particular case. Thoze
creditors who were able to keep their certificates, hav generally done
it, and on every principle are entitled to the full nominal valu.
In the second place, the case of an individual assignee of a bond wil
not apply; for _B_, in the suppozition, takes the bond voluntarily. _A_,
the dettor, haz property, and it iz optional with _B_, whether to bring
a suit for the money, recover a judgement, and take _A's_ property, or
take a bond on interest. This iz generally the case with individuals,
but not with the public creditors. Theze hav no alternativ; they must
take promises, which the subject cannot compel the public to fulfil,
when the money iz wanted. In another particular, the two cases are
widely different. _A_, _B_, and _C_, are three distinct persons. _A_ iz
the dettor, and it iz indifferent whether he pays the det to _B_ or _C_.
But when _B_ haz sold the note for half the valu, he cannot be called
upon for the money, nor for any part of it. In the other case, the
creditors and the public are, in some mezure, the same person. The same
persons who looze their property by public delinquency, are afterwards
taxed to pay their proportion to the purchasers. But I wil for a moment
suppoze the two cases exactly similar; for I am willing to giv my
antagonists the fairest field of argument; and what conclusion can be
drawn in favor of paying the certificates to the bearers? Can that
reezoning be just which draws general consequences from particular
propozitions? Such bad logic ought not to impeech a man's heart; but it
can do very little honor to hiz head.
Do men, who reezon in this manner, consider that a principle with
respect to individuals, may be perfectly _just_, and yet pursued to a
certain degree, it may become entirely false? That the same principle
which may be good in a certain degree, may, in the extreme becume
criminal, iz tru not only in politics, but in the natural and moral
systems. Heet and water, prouduce vegetables; but too large portions of
either, destroy plants. Every passion, natural to man, iz good in
itself, and the wurk of a perfectly wise being; but any passion indulged
to a certain degree, becumes criminal and destructiv to social
happiness. Self-love, the spring of all action, and in the tru sense of
the word, the most necessary principle in creation, when it becumes
excessiv, iz az criminal and pernicious, az the most malignant passion.
Eeting and sleeping are essential to helth; but beyond a certain degree,
they are hurtful, and may be fatal to the human body.
In politices, the greatest possible good iz the end of guvernment. Any
principle, which may be tru, in particular instances, but which, when
extended to the public, does not produce the greatest good to society,
iz certainly false in legislation. A law which may be good and necessary
in a community, may stil bear hard upon individuals. This iz generally
tru of all laws. If a man takes a note of another, and sells it for half
its valu, he haz no remedy in law, nor ought the law to make provision
for hiz case; for laws are, in their nature and use, general; they do
not desend to particular cases. The reezon iz obvious. Were laws to
notice every inconvenience, which may flow from their operation, they
would produce confusion rather than order, and occasion greater injuries
to the public, than would result from the losses of individuals. But
when such particular losses becume general, the principle loozes its
force. Sufferings, multiplied to a certain number, becume public, and
then require the interference of the legislature. If a man iz in det,
and cannot pay, he iz at the disposal of the law; the law cannot be
suspended nor relaxed for hiz particular benefit. But when the body of a
peeple becume involved, the public safety requires a suspension or
relaxation of law. If an individual settles upon land of another man, he
iz considered az a trespasser, and iz liable to an ejectment. But let
thirty thousand men settle thus upon land that iz not their own, and a
wize legislature wil confirm them in their possessions. Necessity or
general good, in such cases, suspends the operation of legal right, or
rather changes _private rongs_ into _public right_. Or to express the
idea differently; when evils are increesed and extended to a certain
degree, it iz better to let them remain, than to risk the application of
a violent remedy. Instances of this kind occur so frequently, that it iz
needless to multiply examples. Nothing betrays greater weekness, than
the reezoning of peeple, who say, if a principle iz just, it extends to
all cases. I should however be very unhappy to hav such men for my
legislators. It may be asked, where iz the line of distinction? I
answer, it may be impossible to determin. Where the _right_ ends, and
the _rong_ begins; where the legal principle should ceese to operate,
and special legislativ interference becumes necessary, it may be
difficult to discuver; but the extreme iz always obvious. Whenever the
operation of a receeved maxim or principle givs general uneasiness, it
iz a demonstrativ proof that it iz rong: that it produces public evil;
and a wize legislator wil restrain the operation, or establish a
different principle: On the suppozition therefore that the present
holders of the public det, are precisely in the situation of the
assignees of bonds, stil the principle wil not apply nor warrant the
same conclusion in both cases; becauze we cannot reezon from particulars
to generals, especially on political subjects.
Suppoze the original creditors to be five, and the present holders two;
more than half the number of creditors hav lost the money which waz due
to them; the loss affects them in the first instance, and the hevy taxes
which are necessary to appreciate the certificates in other hands,
double their injuries and complaints. Theze loozing creditors hav an
idea that they are really cheeted, and their murmurs foment that popular
jealousy which iz ever bizzy to check large and sudden revolutions of
property. The certificates fall into the hands of rich men, at a great
discount, and the body of the peeple say, "we wil not suffer our own
losses to enrich our welthy nabors."
This outcry, it iz said, proceeds from a levelling principle, which aims
to destroy all distinction of rank and property. But in the present
case, the popular complaints proceed from equitable principles; nor do I
know of any instance of public jelousy, excited by an acquizition of
property in the course of honest industry. Fortunes may be suddenly
raized in private business, by commercial speculations, and no notice
taken of the event; but when public delinquency haz thrown numberless
advantages into the hands of a particular class of men, which the peeple
know are made at their own expense, it iz impossible that they should
behold such a change of property, without questioning the propriety of
it, and the justness of the principle by which it iz defended. When the
common sense of mankind iz oppozed to such a change, it ought to be
considered az a good proof that it iz not just.
Whatever conclusions therefore may be drawn from a principle,
established in _courts_ of _law_, or among nations in different
circumstances, the public sense of justice must, after all, decide the
question. A lawyer may wurk himself up to convictions, in wire-drawing
principles; but hiz reezoning iz oppozed to the sense of mankind. Peeple
may not be able to _discuver_ the fallacy of the reezoning, but they can
_feel_ it. They may be _silenced_, but cannot be _convinced_.
One grain of common sense iz worth a thousand cobweb theories; and
however peeple may be abuzed for refining upon justice, we rarely find
them generally dispozed to do rong.
The domestic det of America furnishes a new era in the history of
finance. We hav no examples to follow; we must pursu some practicable
system, with our eyes invariably fixed on public justice. I know it iz
said that the original creditors can purchase certificates now, at the
same or a less price than they took for them. But this iz not strictly
tru. Individuals might purchase at a low rate; but a general demand for
them would raize their valu much abuv their current valu at any past
period: For it should be considered that hitherto the sellers hav been
numerous, and the purchasers, few; that iz, a full market, with little
demand for the articles. Reverse the case. Let the sellers becume the
purchasers; the demand would at once raize the valu of the certificates
neerly to the face of them.
But if the certificates were to pass at their present low valu, few of
thoze who hav alienated them, could re-purchase; for the same necessity
which obliged them to sell at a loss, now prevents their repurchasing.
Peeple hav not grown rich since the revolution; especially thoze who
were faithful in the service of their country. At any rate it iz to be
wished that the certificates might ceese to circulate az objects of
speculation. They are a Pandora's box to this country.
Almost the whole activ specie of the country iz employed in speculation.
Laws prohibiting usury, restrain the loan of money, while the certain
profits of speculation amount to five or ten times the legal interest.
No money can be borrowed; no capitals can be raized to encurage
agriculture and manufactures: Lucrativ industry iz checked; land iz sunk
to two thirds of its real valu, and multitudes of industrious peeple are
embarrassed. From such evils, good Lord deliver us.
No. XXIX.