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If any persons living in distant countries have, through their absence from their property in America, suffered loss by not having it timely fixed in the several--loans above mentioned, it is not doubted but that, upon an application to Congress stating the case, they will meet with redress.
The real money used in the United States is French, Spanish, Portuguese, and English coins, gold and silver. The most common is Spanish milled dollars, worth five livres five sols tournois.
The nominal money is generally paper, reckoned in pounds, shillings, and pence, of different value in the different States when compared with real money, and that value often changing, so that nothing certain can be said of it. Everywhere the accounts are kept in the nominal pounds, shillings, and pence, the pound containing twenty shillings, and the shilling twelve pence, whatever may be the real value.
Bills of exchange are frequently drawn on Europe; the rate of exchange differing in different States, and fluctuating in the same State, occasioned by the greater or less plenty of bills or of demand for others; they are commonly drawn at thirty days' sight.
The usages in buying and selling merchandises, are much the same as in Europe, except that in Virginia the planter carries his tobacco to magazines, where it is inspected by officers, who ascertain its quality and give receipts expressing the quantity. The merchants receive these receipts in payment for goods, and afterwards draw the tobacco out of the magazines for exportation. Weights and measures are uniform in all the States, following the standard of Great Britain.
Money is lent either upon bond or on mortgage, payable in a year with interest. The interest differs in the different States from five to seven per cent. VOL. II.
Goods are generally imported on eighteen months' credit from Europe, sold in the country at twelve months' credit.
Billets or promissory notes, payable to the creditor or order, are in use, and demandable when due, as well as accepted bills of exchange, without any days of grace, but by particular favor.
OF GREAT BRITAIN AND THE UNITED STATES
IN REGARD TO
THE BASIS OF CREDIT IN THE TWO COUNTRIES.
This paper was written in the year 1777, while Franklin was one of the Commissioners from the United States in France. The object was to produce in Europe a just impression of the resources and political condition and prospects of the United States, with the view of encouraging governments and private capitalists to loan money to the American Congress. It was translated into various languages and widely circulated. — EDITOR.
In borrowing money, a man's credit depends on some, or all, of the following particulars.
First. His known conduct respecting former loans, and his punctuality in discharging them.
Secondly. His industry.
Fourthly. The amount and the certainty of his income, and the freedom of his estate from the incumbrances of prior debts.
Fifthly. His well-founded prospects of greater future ability, by the improvement of his estate in value, and by aids from others.
Sixthly. His known prudence in managing his general affairs, and the advantage they will probably receive from the loan which he desires.
Seventhly. His known probity and honest character, manifested by his voluntary discharge of debts, which he could not have been legally compelled to pay. The circumstances, which give credit to an individual, ought to have, and will have, their weight upon the lenders of money to public bodies or nations. If then we consider and compare Britain and America in these several particulars, upon the question, “To which is it safest to lend money?” we shall find,
1. Respecting former loans, that America, who borrowed ten millions during the last war, for the maintenance of her army of twenty-five thousand men and other charges, had faithfully discharged and paid that debt, and all her other debts, in 1772. Whereas Britain, during those ten years of peace and profitable commerce, had made little or no reduction of her debt; but on the contrary, from time to time, diminished the hopes of her creditors by a wanton diversion and misapplication of the sinking fund destined for discharging it.
2. Respecting industry ; every man in America is employed; the greater part in cultivating their own lands, the rest in handicrafts, navigation, and commerce. An idle man there is a rarity ; idleness and inutility are disgraceful. In England the number of that character is immense; fashion has spread it far and wide. Hence the embarrassments of private fortunes, and the daily bankruptcies, arising from a universal fondness for appearance and expensive pleasures; and hence, in some degree, the mismanagement of public business; for habits of business, and ability in it, are acquired only by practice; and, where universal dissipation and the perpetual pursuit of amusement are the mode, the youth educated in it can rarely afterwards acquire that patient attention and close application to affairs, which are so necessary to a statesman charged with the care of national welfare. Hence their frequent errors in policy, and hence the weariness at public councils, and backwardness in going to them, the constant unwillingness to engage in any measure that requires thought and consideration, and the readiness for postponing every new proposition; which postponing is therefore the only part of business they come to be expert in, an expertness produced necessarily by so much daily practice. Whereas, in America, men bred to close employment in their private affairs attend with ease to those of the public when engaged in them, and nothing fails through negligence.
3. Respecting frugality; the manner of living in America is more simple and less expensive than in England; plain tables, plain clothing, and plain furniture in houses prevail, with few carriages of pleasure. There an expensive appearance hurts credit, and is avoided; in England it is often assumed to gain credit, and continued to ruin. Respecting public affairs, the difference is still greater. In England the salaries of officers and emoluments of office are enormous. The King has a million sterling per annum, and yet cannot maintain his family free of debt; secretaries of state, lords of the treasury, admiralty, &c., have vast appointments; an auditor of the exchequer has sixpence in the pound,
or a fortieth part, of all the public money expended by the nation, so that, when a war costs forty millions, one million is paid to him; an inspector of the mint, in the last new coinage, received as his fee £65,000 sterling per annum; to all which rewards no service these gentlemen can render the public is by any means equivalent. All this is paid by the people, who are oppressed by taxes so occasioned, and thereby rendered less able to contribute to the payment of necessary national debts. In America, salaries, where indispensable, are extremely low; but much of the public business is done gratis. The honor of serving the public ably and faithfully is deemed sufficient. Public spirit really exists there, and has great effects. In England it is universally deemed a nonentity, and whoever pretends to it is laughed at as a fool, or suspected as a knave. The committees of Congress, which form the board of war, the board of treasury, the board of foreign affairs, the naval board, that for accounts, &c., all attend the business of their respective functions without any salary or emolument whatever, though they spend in it much more of their time, than any lord of the treasury or admiralty in England can spare from his amusements. A British minister lately computed, that the whole expense of the Americans in their civil government, over three millions of people, amounted to but £70,000 sterling, and drew from thence a conclusion, that they ought to be taxed, until their expense was equal in proportion to that which it costs Great Britain to govern eight millions. He had no idea of a contrary conclusion, that, if three millions may be well governed for £70,000, eight millons may be as well governed for three times that sum, and that therefore the expense of his own government should