mons, and one or two others who had conversed with Mr. Morris on the change of the last day of December for the- -day of August, it was suggested that the change entirely contravened the measures pursued by his department; and moved for a reconsideration of it, in order to inquire into the subject. Without going into details, they urged this as a reason sufficient. The eastern delegates, although they wished for unanimity and system in future proceedings relative to our funds and finances, were very stiff in retaining the vote which coincided with the steps taken by their constituents. Of this much complaint was made. Mr. RUTLEDGE, on this occasion, alleging that Congress ought not to be led by general suggestions derived from the office of finance, joined by Mr. Gervais, voted against the reconsideration. The consequence was, that South Carolina was divided, and six votes only in favor of the reconsideration. Mr. HAMILTON having expressed his regret at the negative, and explained more exactly the interference of the change of the epoch with the measures and plans of the office of finance, which had limited all state advances and settlements to August 1780, Mr. RUTLEDGE acknowledged the sufficiency of the reasons, and at his instance the latter date was reinstated. On this second question Connecticut also voted for August.

The day of August being reinstated, before a question on the whole paragraph was taken, Mr. GORHAM objected to the word "general" before funds, as ambiguous, and it was struck out; not, however, as improper, if referring to all the states, and not to all objects of taxation. Without this word the claus passed unanimously, even Rhode Island concurring in it.

Congress proceeded to the third clause relative to the commutation of half-pay. A motion was made, by Mr. HAMILTON, to fill the blank with "six;" this was in conformity to tables of Dr. Price, estimating the officers on the average of good lives. Liberality in the rate was urged by several as necessary to give satisfaction, and prevent a refusal of the offer. For this motion there were six ayes, five noes; the Southern States and New York being in the affirmative, the Eastern and New Jersey in the negative. Colonel BLAND proposed six and a half, erroneously supposing the negative of six to have proceeded from its being too low. It was, on the contrary, rather doubtful whether the Eastern States would concur in any arrangement on this head, so averse were they to what they call pensions. Several having calculated that the annual amount of half-pay was between four and five hundred thousand dollars, and the interest of the gross sum nearly two thirds of that sum, Congress were struck with the necessity of proceeding with more caution, and for that purpose committed the report to a committee of fiveMr. Osgood, Mr. Fitzsimmons, Mr. Gervais, Mr. Hamilton, and Mr. Wilson.

On the motion of Mr. WILSON, Monday next was assigned for the consideration of the resolution on the second clause of the report on the memorial from the army. He observed, that this was necessary to prevent the resolution from being, like many others, vox et præterea nihil.

MONDAY, January 27.

A letter from General Washington was received, notifying the death of Lord Stirling, and enclosing a report of the officer sent to apprehend Knowlton and Wells. (See p. 8.)

The following is an extract from the report:

“He (one Israel Smith) further said, that Knowlton and Wells had received a letter from Jonathan Arnold, Esquire, at Congress, part of which was made public, which informed them that affairs in Congress were unfavorable to them, and would have them to look out for themselves. What other information this letter contained, he could not say. I found, in my march through the state, that the last-mentioned gentleman was much in favor with all the principal men in that state I had any conversation with."

Mr. ARNOLD, being present at the reading, informed Congress that he was surprised how such a notion should have prevailed with respect to him; that he had never held any correspondence with either Knowlton or Wells; and requested that he might be furnished with the extract above. In this he was indulged without opposition. But it was generally considered, notwithstanding his denial of the correspondence, that he had, at least at second-hand, conveyed the intelligence to Vermont.

A long petition was read, signed, as alleged, by nearly two thousand inhabitants

'but all in the same hand-writing) of the territory lately in controversy between Pennsylvania and Virginia, complaining of the grievances to which their distance from public authority exposed them, and particularly of a late law of Pennsylvania interdicting even consultations about a new state within its limits, and praying that Congress would give a sanction to their independence, and admit them into the Union. The petition lay on the table, without a single motion or remark relative to it.

The order of the day was called for- to wit, the resolution of Saturday last in favor of adequate and substantial funds.

The subject was introduced by Mr. WILSON, with some judicious remarks on its importance, and the necessity of a thorough and serious discussion of it. He observed, that the United States had, in the course of the revolution, displayed both an unexampled activity in resisting the enemy, and an unexampled patience under the losses and calamities occasioned by the war. In one point only, he said, they had appeared to be deficient, and that was, a cheerful payment of taxes. In other free governments, it had been seen that taxation had been carried farther, and more patiently borne, than in states where the people were excluded from the governments; the people considering themselves the sovereign as well as the subject, and as receiving with one hand what they paid with the other. The peculiar repugnance of the people of the United States to taxes, he supposed, proceeded, first, from the odious light in which they had been, under the old government, in the habit of regarding them; secondly, from the direct manner in which taxes in this country had been laid, whereas in all other countries taxes were paid in a way that was little felt at the time. That it could not proceed altogether from inability, he said, must be obvious; nay, that the ability of the United States was equal to the public burden, could be demonstrated. According to calculations of the best writers, the inhabitants of Great Britain paid, before the present war, at the annual rate of at least twenty-five shillings sterling per head. According to like calculations, the inhabitants of the United States, before the revolution, paid, indirectly and insensibly, at the rate of at least ten shillings sterling per head. According to the computed depreciation of the paper emissions, the burden insensibly borne by the inhabitants of the United States had amounted, during the first three or four years of the war, to not less than twenty millions of dollars per annum -a burden, too, which was the more oppressive as it fell very unequally on the people. An inability, therefore, could not be urged as a plea for the extreme deficiency of the revenue contributed by the states, which did not amount, during the past year, to half a million of dollars; that is, to one sixth of a dollar per head. Some inore effectual mode of drawing forth the resources of the country was necessary. That, in particular, it was necessary that such funds should be established as would enable Congress to fulfil those engagements which they had been enabled to enter into. It was essential, he contended, that those to whom was delegated the power of making war or peace should, in some way or other, have the means of effectuating these objects; that, as Congress had been under the necessity of contracting a large debt, justice required that such funds should be placed in their hands as would discharge it; that such funds were also necessary for carrying on the war, and as Congress found themselves, in their present situation, destitute both of the faculty of paying debts already contracted, and of providing for future exigencies, it was their duty to lay that situation before their constituents, and at least to come to an éclaircissement on the subject. He remarked, that the establishment of certain funds for paying would set afloat the public paper; adding, that a public debt, resting on general funds, would operate as a cement to the Confederacy, and might contribute to prolong its existence, after the foreign danger ceased to counteract its tendency to dissolution. He concluded with moving that it be resolved,―

That it is the opinion of Congress that complete justice cannot be done to the creditors of the United States, nor the restoration of public credit be effected, nor the future exigencies of the war provided for, but by the establishment of general funds, to be collected by Congress."

This motion was seconded by Mr. FITZSIMMONS.

Mr. BLAND desired that Congress would, before the discussion proceeded further, receive a communication of sundry papers transmitted to the Virginia

delegates by the executive of that state, two of which had relation to the question before Congress. These were first, a resolution of the General Assembly, declaring its inability to pay more than fifty thousand pounds, Virginia currency, towards complying with the demands of Congress; secondly, the act repealing the act granting the impost of five per cent. These papers were received and

read.

Mr. WOLCOTT expressed some astonishment at the inconsistency of these two acts of Virginia; supposed that they had an unfavorable aspect on the business before Congress, and proposed that the latter should be postponed for the present. He was not seconded.

Mr. GORHAM favored the general idea of the motion, animadverting on the refusal of Virginia to contribute the necessary sums, and at the same moment repealing her concurrence in the only scheme that promised to supply a deficiency of contributions. He thought the motion, however, inaccurately expressed, since the word "general" might be understood to refer to every possible object of taxation, as well as to the operation of a particular tax throughout the states. He observed that the non-payment of the one million two hundred thousand dollars demanded by Congress, for paying the interest of the debts for the yeardemonstrated that the constitutional mode of annual requisitions was defective; he intimated that lands were already sufficiently taxed, and that polls and commerce were the most proper objects. At his instance, the latter part of the motion was so amended as to run "establishment of permanent and adequate funds to operate generally throughout the United States."

Mr. HAMILTON went extensively into the subject; the sum of it was as follows: he observed that funds considered as permanent sources of revenue were of two kinds-first, such as would extend generally and uniformly throughout the United States, and would be collected under the authority of Congress; secondly, such as might be established separately within each state, and might consist of any objects which were chosen by the states, and might be collected either under the authority of the states or of Congress. Funds of the first kind, he contended, were preferable; as being, first, more simple, the difficulties attending the mode of fixing the quotas laid down in the Confederation rendering it extremely complicated, and in a manner insuperable; secondly, as being more certain, since the states, according to the said plan, would probably retain the collection of the revenue, and a vicious system of collection prevailed generally throughout the United States - -a system by which the collectors were chosen by the people, and made their offices more subservient to their popularity than to the public revenue; thirdly, as being more economical, since the collection would be effected with fewer officers, under the management of Congress, than under that of the states. Mr. GORHAM observed, that Mr. Hamilton was mistaken in the representation he had given of the collection of taxes in several of the states, particularly in that of Massachusetts, where the collection was on a footing which rendered it sufficiently certain.

Mr. WILSON, having risen to explain something which had fallen from him, threw out the suggestion that several branches of the revenue, if yielded by all the states, would perhaps be more just and satisfactory than any single one; for example, an impost on trade combined with a land tax.

Mr. DYER expressed a strong dislike to a collection by officers appointed under Congress, and supposed the states would never be brought to consent to it.

Mr. RAMSAY was decidedly in favor of the proposition. Justice, he said, entitled those who had lent their money and services to the United States to look to them for payment; that if general and certain revenues were not provided, the consequence would be that the army and public creditors would have soon to look to their respective states only for satisfaction; that the burden in this case would fall unequally on the states; that rivalships relative to trade would impede a regular impost, and would produce confusion among the states; that some of the states would never make, of themselves, provision for half-pay, and that the army would be so far defrauded of the rewards stipulated to them by Congress; that although it might be uncertain whether the states would accede to plans founded on the proposition before the house, yet, as Congress was convinced of its truth and importance, it was their duty to make the experiment.

Mr. BLAND thought, that the ideas of the states on the subject were so averse to a general revenue in the hands of Congress, that if such a revenue were proper it was unattainable; that as the deficiency of the contributions from the states, proceeded, not from their complaints of their inability,* but of the inequality of the apportionments, it would be a wiser course to pursue the rule of the Confederation, to wit, to ground the requisition on an actual valuation of lands; that Congress would then stand on firm ground, and try a practicable mode.

TUESDAY, January 28.

The subject yesterday under discussion was resumed. A division of the question was called for by Mr. WOLCOTT, so as to leave a distinct question on the words "to be collected by Congress," which he did not like.

Mr. WILSON considered this mode of collection as essential to the idea of a gencral revenue, since, without it, the proceeds of the revenue would depend entirely on the punctuality, energy, and unanimity of the states, the want of which led to the present consideration.

Mr. HAMILTON was strenuously of the same opinion.

Mr. FITZSIMMONS informed Congress that the legislature of Pennsylvania had, at their last meeting, been dissuaded from appropriating their revenue to the payment of their own citizens, creditors of the United States, instead of remitting it to the Continental treasury, merely by the urgent representations of a committee of Congress, and by the hope that some general system in favor of all the public creditors would be adopted; that the legislature were now again assembled, and, although sensible of the tendency of such an example, thought it their duty, and meant, in case the prospect of such a system vanished, to proceed immediately to the separate appropriations formerly in contemplation.

On the motion of Mr. MADISON, the whole proposition was new-modelled, as follows:

"That it is the opinion of Congress that the establishment of permanent and adequate funds, to operate generally throughout the United States, is indispensably necessary for doing complete justice to the creditors of the United States, for restoring public credit, and for providing for the future exigencies of the war."

The words "to be collected under the authority of Congress" were, as a separate question, left to be added afterwards.

Mr. RUTLEDGE objected to the term "generally," as implying a degree of uniformity in the tax which would render it unequal. He had in view, particularly, a land tax, according to quality, as had been proposed by the office of finance. He thought the prejudices of the people opposed the idea of a general tax; and seemed, on the whole, to be disinclined to it himself, at least if extended beyond an impost on trade; urging the necessity of pursuing a valuation of land, and requisitions grounded thereon.

Mr. LEE seconded the opposition to the term "general." He contended that the states would never consent to a uniform tax, because it would be unequal; that it was, moreover, repugnant to the Articles of Confederation; and, by placing the purse in the same hands with the sword, was subversive of the fundamental principles of liberty. He mentioned the repeal of the impost by Virginia -- himself alone opposing it, and that, too, on the inexpediency in point of time- as proof of the aversion to a general revenue. He reasoned upon the subject, finally, as if it was proposed that Congress should assume and exercise a power immediately, and without the sanction of the states, of levying money on them.

Mr. WILSON rose, and explained the import of the motion to be, that Congress should recommend to the states the investing them with power. He observed that the Confederation was so far from precluding, that it expressly provided for, future alterations; that the power given to Congress by that act was too little, not too formidable; that there was more of a centrifugal than centripetal force in the states, and that the funding of a common debt in the manner proposed would produce a salutary invigoration and cement to the Union.

Mr. ELLSWORTH acknowledged himself to be undecided in his opinion; that, on the one side, he felt the necessity of Continental funds for making good the Conti

* The papers just read, from Virginia, complained of her inability, without mentioning an inequality. This was deemed a strange assertion.

nental engagements; but, on the other, desponded of a unanimous concurrence of the states in such an establishment. He observed, that it was a question of great importance, how far the federal government can or ought to exert coercion against delinquent members of the Confederacy; and that without such coercion, no certainty could attend the constitutional mode which referred every thing to the unanimous punctuality of thirteen different councils. Considering, therefore, a Continental revenne as unattainable, and periodical requisitions from Congress as inadequate, he was inclined to make trial of the middle mode of permanent state funds, to be provided at the recommendation of Congress, and appropriated to the discharge of the common debt.

Mr. HAMILTON, in reply to Mr. ELLSWORTH, dwelt long on the inefficacy of state funds. He supposed, too, that greater obstacles would arise to the execution of the plan than to that of a general revenue. As an additional reason for the latter

to be collected by officers under the appointment of Congress, he signified, that, as the energy of the federal government was evidently short of the degree necessary for pervading and uniting the states, it was expedient to introduce the influence of officers deriving their emoluments from, and consequently interested in supporting the power of, Congress.*

Mr. WILLIAMSON was of opinion, that Continental funds, although desirable, were unattainable, at least to the full amount of the public exigencies. He thought, if they could be obtained for the foreign debt, it would be as much as could be expected, and that they would also be less essential for the domestic debt.

Mr. MADISON observed, that it was needless to go into proofs of the necessity of paying the public debts; that the idea of erecting our national independence on the ruins of public faith and national honor must be horrid to every mind which retained either honesty or pride; that the motion before Congress contained a simple proposition, with respect to the truth of which every member was called upon to give his opinion; that this opinion must necessarily be in the affirmative, unless the several objects of doing justice to the public creditors, &c. &c., could be compassed by some other plan than the one proposed; that the two last objects depended essentially on the first; since the doing justice to the creditors would alone restore public credit, and the restoration of this would alone provide for the future exigencies of the war. Is, then, a Continental revenue indispensably necessary for doing complete justice, &c.? This is the question. To answer it, the other plans proposed must first be reviewed.

In order to do complete justice to the public creditors, either the principal must be paid off, or the interest paid punctually. The first is admitted to be impossible on any plan. The only plans opposed to the Continental one for the latter purpose are, first, periodical requisitions according to the Federal Articles; secondly, permanent funds established by each state within itself, and the proceeds consigned to the discharge of public debts.

Will the first be adequate to the object? The contrary seems to be maintained by no one. If reason did not sufficiently premonish, experience has sufficiently demonstrated, that a punctual and unfailing compliance, by thirteen separate and independent governments, with periodical demands of money from Congress, can never be reckoned upon with the certainty requisite to satisfy our creditors, or to tempt others to become our creditors in future.

Secondly. Will funds separately established within each state, and the amount submitted to the appropriation of Congress, be adequate to the object? The only advantage which is thought to recommend this plan is, that the states will be with less difficulty prevailed upon to adopt it. Its imperfections are, first, that it must be preceded by a final and satisfactory adjustment of all accounts between the United States and individual states, and by an apportionment founded on a valuation of all the lands throughout each of the states, in pursuance of the law of the Confederation; for although the states do not as yet insist on these prerequisites in the case of

*This remark was imprudent, and injurious to the cause which it was meant to serve. This influence was the very source of jealousy which rendered the states averse to a revenue under collection, as well as appropriation of Congress. All the members of Congress who concurred, in any degree, with the states in this jealousy, smiled at the disclosure. Mr. Bland, and still more Mr. Lee, who were of this number, took notice, in private conversation, that Mr. Hamilton had let out the secret.