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H. OF R.

State Balances.

JANUARY, 1804,

must have lost by the change of ratio, the sum of others who had paid full price for them; and in $774,048, and Virginia $1,165,384. It would be order to effect their object, they passed certain an easy matter to show the effect which this mea- acts by which they depreciated even their specie sure had upon every State in the Union; but it certificates to four shillings on the pound. And would be foreign to my purpose, and I shall there by way of recompense to the soldiers for the loss fore decline it, with barely observing, that it is they had sustained from the depreciation on their evident a considerable majority of the States were certificates, they made them very liberal donations gainers by the measure.

of the unappropriated lands of the State, giving In addition to the injury sustained by the State to the common war soldier six hundred and forty of North Carolina from the change of ratio, I must acres. And here, sir, I will beg leave to remark, beg leave to mention another, which I have un- that these were not what are commonly called derstood from the Commissioners who attended Crown lands, but lands which had been granted to the settlement of her accounts with the Union, by the Crown before the Revolution. I make this she suffered from having her vouchers for currency remark, because I know it is the opinion of some certificates first reduced to their specie value, and of the Committtee that all the States had a right then these as well as her specie certificates scaled to any lands which, previous to the Revolution, at four shillings in the pound. By what authority, belonged to the Crown, while all admit that lands or upon what principle of equity or justice, the which had been previously'granted by the Crown Commissioners felt themselves justified in doing belonged properly to the State within whose limthis, I am at a loss to determine. The only rea- its it lay. Now, sir, if the Commissioners in setson assigned for it, as I have understood, was, that thing the accounts of this State with the Union, this was the rate at which the Legislature of the did not think she ought to be credited at a higher State had valued them. Now, sir

, I admit that price for her certificates than she, for the reasons this was the sum at which the Legislature had just mentioned, had thought proper to set upon rated her certificates; but it by no means follows them, they should at least have given her credit as a consequence that the Commissioners, in the for the lands which she had given her soldiers as settlement of her accounts with the Union, did a recompense for the depreciation of their certifijustice to her in giving her credit for them at the cates. It will not, I presume, be pretended that same rate. For, sir, it will be recollected that they were ignorant of any advance having been under the Articles of Confederation each State made on lands to her soldiers, because, in searchraised from its citizens, in the way most suitable ing for the laws by which she had rated' her certifito themselves, the different sums of money or sup- cates, they could not fail seeing the one by which plies which Congress might require of them. It she had granted the lands to her soldiers. The is also well known, that the great scarcity of operation of this principle of the Commissioners specie rendered it necessary to resort to some ex- must have been very partial, as few of the States pedient to supply the place of it, and that the first had adopted similar measures for paying off their attempt was by issuing a paper currency, which certificates; and that its operation must have been depreciated rapidly, and in a short time fell upon unjust, will be obvious to the weakest mind when the hands of those who held it. The next step it is recollected, that the Union had received from was to issue certificates to those who either per- the citizens of North Carolina full value in the formed services, or furnished supplies in support services and supplies for which these articles had of the common cause, purporting that the bearer been issued by ihe State. If the citizens of any was entitled to the amount thereof, either in cur- State thought proper by their Representatives in rency or specie, from the State on whose account their Legislature to consent to give up to the State the service was performed or the supplies fur- sixteen shillings in every pound of the debt, which nished. The paper currency which had been the State in complying with the requisitions of issued, having borne at the same periods in differ- Congress had contracted with them, and which ent States very different rates of depreciation, it the State alone under the Articles of Confederawas necessary, in order to do justice, that the Com- tion stood responsible to them for; could this jusmissioners should be vested with power to scale lify the Commissioners in adopting a rule by which the currency certificates in the different States, they were to be compelled to pay to the other according to the value which the currency had States the sums they had consented to give up to borne in them respectively, and this power by the their own ? Certainly not. And yet, sir, no man ordinance of May, 1787, was given them. Such, will say that this is not the obvious effect of this however, was the scarcity of cash in that State, principle adopted by the Commissioners in the that by far the greater part of the soldiers as well settlement of these accounts. The exact amount as others who had received even her specie cer- of the injury sustained by the State of North tificates for services performed, or supplies fur- Carolina, by this rule of the Commissioners, it is nished, had, some from necessity and others from impossible to ascertain; but when we recollect a want of confidence in the Government, parted the enormous quantity of certificates which from with them to speculators at about two shillings the scarcity of specie were obliged to be issued and six pence in the pound. This being a fact for the pay of the army, and purchase of supplies, notorious to all, the Legislature of the State de- we may fairly conclude that the loss to her from termined to do full justice to the speculator who this measure, fell very little short of that which had purchased the certificates at one eighth of she suffered from the changes of ratio. their value, without oppressing the soldiers and These, sir, were the two principal injuries susJANUARY, 1804.

State Balances.

H. OF R.

tained by the State of North Carolina in the settle- by the settlement, why was it not objected to, ment of her accounts with the Union, and are the and the error pointed out at first, when they might whole that I should have troubled the Committee have been examined into and corrected with ease ? with, had not the gentleman from Rhode Island, Why has it been let alone till this late period, (Mr. Stanton,) with a view, I presume, of show- " when there is not the most distant hope that, were ing that the settlement was as fair for one State the accounts opened anew, a settlement could be as another, inasmuch as all suffered by it more effected, that would prove even as satisfactory as or less, told us that his State had lost a very con- the one already made, and against which we so siderable sum by the operation of that part of the loudly complain? I am convinced that the genact of Congress of the fifth of August, 1790, which tleman has not examined this subject with his prohibits the Commissioners allowing any claim, usual accuracy, or he would never have asked which had not been allowed by the State pro- such questions. The fact is, that the settlement ducing it previous to the twenty-fourth day of has been complained of by the Representatives September, 1788. By the operation of the same from the State of North Carolina, as well as several part of that law the State of North Carolina also other States, ever since the report was made; and lost nearly $100,000, which she has felt herself at the very session when it was first published an bound to pay principally to the heirs of those who attempt was made to bring to light the principles had either fallen in the service or died soon after upon which the Commissioners had settled the the close of the war, and had not come of age to accounts, with a view, no doubt, that the errors claim their rights as early as the year 1788. The which had arisen from them might be corrected, truth of this can be vouched by one of the present and justice done to those States which had been Senators from that State, as he was one of the injured by them. To prove this fact, I must beg board of auditors appointed by the Legislature to leave to read a resolution which will be found in settle with the claimants, about the year 1791 or the Journals of the first session of the third Con1792.

gress, page 247, in the following words: I have now, sir, gone through the principal ob- Resolved, That a committee be appointed to examjections taken by the State which I have the ine into, and report on, the practicability of obtaining honor to represent in part, to the settlement of a statement of the principles on which the accounts of her accounts with the Union, and I think it must the individual States with the United States have been be obvious to every candid person who has heard settled, and a statement of the several credits allowed me, that if she had been settled with agreeably in the said settlement.” to the principles of equity by which the Commis- This resolution, sir, it appears was lost on taksioners under the ordinance of 1787 were directed ing the question by yeas and nays, and among to be governed, she must in the result have proved those who voted in favor of it, will be found the to be a creditor to a much larger amount than whole of the Representatives from North Caroshe has been reported to be in debt. By the lina, as well as many members from other States. change of ratio, admitting the aggregate of all the In the Journals of the same session it will be found charges of the several States to have been but that when the bill was on its passage providing $24,000,000, she lost better than $770,000; by the for the payment to the creditor States of the balvery unjust rule adopted by the Commissioners ances reported in their favor, an attempt was in scaling her certificates she must have lost made to extinguish the balances reported to be nearly as much, if not more; and by claims which due from the debtor States, by adding a section to were barred under the act of Congress of the 5th the bill in the following words: “And be it further of August, 1790, she lost about $100,000, making enacted, that the balances reported by the said in the whole better than $1,500,000. The sum Commissioners, and carried to the debt of certain reported against her is but little better than $500,- States, be and the same are hereby relinquished.” 000, from whence it results that instead of being The section was rejected, but the yeas and nays reported a debtor she should have been a creditor not having been taken on the question, we are not for about $1,000,000. I feel myself bound to make able to say, to a certainty, who voted for it or this statement, after what has fallen from gentle against it.' There can, however, be but little doubt men, in the course of the debate, who have opposed as to who were the advocates or opposers of this the resolution upon the principle that they believe section, when we attend to its objects, and see the settlement to have been just, or at least that it who voted for and against the resolution just read. was made upon principles which operated nearly The Committee I hope are now satisfied that the alike upon all the States. This, sir, it is evident report of the Commissioners has never been tawas not the fact, for by the change of ratio a ma- citly acknowledged to be just, by the State of jority of the States were gainers to a very large North Carolina, as well as several other States; amount, while the others were as largely losers; they have seen that at the very session of Conand the rule by which the specie certificates of gress to which the report was first communicated, North Carolina were scaled could not have ap- an attempt was made to bring to light the principlied generally, because there were but few of the ples upon which the settlement had been made, States that had adopted the same method for ex- in order that its errors might be exposed and justinguishing this part of their debt. But, sir, we tice done; and this attempt, they have seen, failed have been asked by a gentleman from Massachu- of success. The reasons why it failed I leave the setts, (Mr. Hastings.) if there were such enor- Committee to conjecture for themselves. It also mous injuries done to the States reported debtors appears that at the same session an attempt was

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State Balances.

JANUARY, 1804. made to extinguish the balances reported against tleman from New Jersey. What injury then can the debtor Slates, and the Journals will show that possibly arise from the adoption of the resolution? repeated attempts have since been made for the i confess I can see none. It is true, some gentlesame purpose, but that these attempts have uni- men have said that it would excite in the States formly failed of success.

reported creditors a fear that attempts would be The reasons which may have induced Congress made to wipe off the balances which bave been formerly to reject the measure I know not. But funded for ihem. The weakness and fallacy of I doubt not in the least, that the ingenuity and in this argument has been so ably shown by a gen. dustry of the gentlemen wbo have on this occasion tleman from Pennsylvania, (Mr. SMILIE,) that with so much zeal opposed the resolution, have I will not take up the time of the Commiitee in enabled them to assign every reason against the attempting to refute it; but will proceed to state measure which the nature of the case would pos- what in my humble opinion will be the good effects sibly admit. In the first place all agree that the resulting from an adoption of the resolution. In General Government does not possess the power the first place I believe it to be certain that the of enforcing the payment of the balances, against State of Delaware will be relieved from the most the consent of the Siates. But the gentleman from distressing embarrasments. In the next place we Maryland thinks that, by continuing to refuse to shall remove a bone of contention, which in all extinguish the balances, ihe States may at length probability would, on some future occasion, be the be induced to accept of offers to lay out either ine cause of some legislative bargain, that in effect whole or a part of the sums they owe, either in may be extremely injurious to the Union. The turnpikes, fortifications, or some other work of unusual anxiety of the members upon this subject, public utility within their own limits, as has been at this time, justifies a belief that this will be the done by the State of New York formerly. What case, particularly should any attempt ever be made the State of New York or any other State may to collect the balances. In the third place we shall be induced to do, I cannot pretend to say, but I prevent a future waste of much of the precious think I can venture to predict, that the gentleman time of this House on a subject which tends to exwill to a certainty be disappointed in any expec- cite too highly the feelings of a large portion of its tations of this nature which he may have calcu- members; and lastly, we shall take from those who lated on from the State of North Carolina, and that may succeed us, and be disposed to add to the nafor the reasons I have already mentioned. And tional debt, a pretext which would be but too fareally the gentleman must be much more sanguine vorable to their design. in his expectation than I am, if he entertains any As then I do not see that any real injury can, serious hopes of ever getting anything more, vol- but on the contrary, that very considerable benefits untarily, from the State of New York. Another certainly will follow, from carrying the object of plan has been hinted at by a gentleman from New the resolution into effect, I shall conclude with Jersey: (Mr. Elmer,) by which the balances might expressing my earnest hope that it may meet with be collected, which is by funding and apportion the support of a majority of the Committee. ing them among the different States; but the gen- The resolution was further supported by Messrs. tleman had not the goodness to tell us how large Smilie, Macon, and Mirchill, and opposed by a sum we should have to fund, or how it would Messrs. Hastings, Gregg, Boyd, Sloan and have to be apportioned among the several States Davis. to carry his plan into effect. I wish he had done The Committee now rose, without coming to a it, because I am convinced, if he had, it would have decision, and obtained leave to sit again. furnished one of the strongest arguments in favor of the resolution that could possibly have been adduced. My reason for thinking so is, because I

WEDNESDAY, January 18. do believe this is the only way in which the bal- Mr. Dennis, from the committee appointed, preances ever will be collected ; and should the reins sented a bill to incorporate the Washington Buildof this Government ever fall into the hands of men ing and Fire Insurance Company; which was who believe, as some great men do, that a national read twice and committed to a Committee of the debt is a national benefit, this will become a pre- Whole on Monday next. text for making a very large addition to the na- The House proceeded to consider the amendtional debt; a thing which I conceive a very con- ment proposed by the Senate to the bill, entitled siderable majority

of this Committee would not 1:An act for the relief of the captors of the Mooronly discountenance, but would use their utmost ish armed ships Meshouda and Mirboha:" Whereexertions to prevent, and would of course advocate upon, the said amendment, together with the bill, the resolution for extinguishing the balances al- were committed to the Committee of Ways and together, rather than leave a pretext to those who Means. may succeed them, for adding so largely to our Mr. Newton observed that Congress having asnational burdens. These are the only plans which sumed jurisdiction over the Territory of Columhave been suggested for collecting the balances; bia, it became their duty to prevent laws existing there are few I believe of the Committee who have therein from being oppressive in their operation. any hope of ever getting them upon the one sug- At present a person, though a citizen of a particgested by the gentleman from Maryland, and a ular State, and prosecuted in his State for debt, still smaller number who would ever wish to see might be held io bail in the Territory, without them collected upon the plan suggested by the gen- oblaining relief. Mr. N. after stating a recent

JANUARY, 1804.

State Balances.

H. of R.

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case of this nature, moved the appointment of a same impure air, and had died alongside of each committee to inquire whether any, and if any, other, and their bones are now bleaching on the what alterations are necessary to be made in the same shores. That such was the intention of the laws of the District of Columbia relative to hold framers of the law appears from this strong ciring persons to bail.

cumstance: It provides for the payment of the The resolution was agreed to, and a committee balances due to the creditor States, while there is of five members appointed.

no provision for the payment of the balances of

the debtor States. For is there in that law any STATE BALANCES.

provision to compel the payment? Is there any The House again went into a Committee of direction to the Attorney General, or to any other the Whole on Mr. Rodney's motion to extinguish organ of the Governmeni, to prosecute the recovery State balances.

of them? While there is a provision for funding Mr. Rodney.-I hope I shall receive the indul- the balances of the creditor States, the law is algence of the Committee in replying, in a very con- together silent as to any provision to coerce the cise manner, to the remarks of gentlemen against payment by the debtor States of their balances. the resolution which I have had the honor of sub- | Am I not fully justified, therefore, in saying that mitting. The strong ground taken by the friends coercion was never intended ?

of the motion has not, in my opinion, been shaken I fear that on one point I have been misunderu by anything which has fallen from those who are stood. I stated yesterday, in the outset of my

opposed to it. We have stated that there exist on remarks, that it was my decided opinion, that the the books of the Treasury certain balances against Commissioners had acted to the best of their particular States, which are productive of great judgments and according to honest consciences. injury to them, while they do not and cannot bene- | I did not impeach their motives. I did not mean fit the United States one dollar. Have gentlemen to be understood as desiring to touch the settlepointed out any mode in which the amount of ment they made. I afterwards, however, stated these balances is to be obtained? Have they that from the nature of the country, comprehendshown the way in which the United States can ing an extensive range of communities of various legitimately obtain a single cent? Have not gen- habits, engaged in a revolution in which they tlemen admitted that so far as these balances ap- were contending for the rights conferred upon ply to the State I have the honor of representing them by God and nature, it was impossible, or they affect her citizens most oppressively-hat extremely improbable to avoid the commission of they sit like an incubus upon her, producing a honest mistakes: and that if this reasoning were stagnation in the culture and improvement of her supported, it would afford an additional reason lands, in the increase of the trade and commerce, why the United States should extinguish these and thereby checking the vital current of the coun- . balances. But did I question the justice of the try? And when the United States reap no bene proceedings or the motives of those who made fit, will gentlemen say it is politic or just to keep the settlement? I did not. The utmost extent to them suspended over her head? What is their which I went was that which I have just stated. worth to the United States? If they should be There is another point on which my remarks taken to market, what would they bring? Is there have been misconceived. I observed that by a visionary speculator in the land that would bid keeping in suspense these balances consequences sixpence for them? Do gentlemen contemplate might iake place, by which the interests of States, compelling the payment of these balances? The now hostile to the extinction, might be seriously amendment to the Constitution, in hibiting the sua compromitted. I did not say a bargain and sale bility of States, has put that remedy out of their might be made of these interests. I hope no such reach forever. Do they expect that any State thing as this can take place. Bnt I said a comwill voluntarily pay them? No. If then this is promise might be effected, and I spoke of what the situation of the business, is the object worth might happen from what has happened. In this I the candle consumed in discussing it on this, or on find myself supported by the language of a reany other occasion ? When the United Sates spectable member in this discusssion. I did not cannot pocket a cent from the continuance of these use this argument in the way of a threat; but I balances, and they are so injurious to some of stated a fact, and, reasoning from experience and the States, will the Government of the Union from human nature, I calmly inquired of the insuffer the interests of those whom they are bound telligence of the Committee whether such a thing to protect to be thus seriously sported with ? might not possibly occur, and whether the possi

By attention to the law passed by Congress on bility of its occurrence was not a strong reason this subject, it will abundantly appear that it was for removing everything of the kind. never contemplated that the debtor States should As long as these balances remain suspended make payment. For it appears to have been be- over the heads of the debtor States they will be lieved that every State in the Union had exerted monuments of the imbecility of the General Govitself in the common cause to the utmost; that the eroment, and will, in the eyes of the world, present blood of the citizens of Delaware had been min- an unfavorable aspect of the disposition of several gled with the blood of the citizens of South Caro- of the States to that Government. They will lina; that the citizens of the different States had show that several States refuse to comply with fought, bled, and died together; that they had been the demands of the General Government, and that confined in the same prison-ships, had inspired the I the General Government has not power to make


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H. OF R.

State Balances.

JANUARY, 1804.

them comply. Ought not the Government, on Mr. SOUTHARD.-I rise, Mr. Chairman, to give this ground alone, when it is acknowledged on a reason for the vote I shall soon be called upon all hands that she is unable to exact these debts, to give. Every member of this House who has and when their continuance operates so nju- preceded me on this question has drawn concluriously to several of the States, to abandon them? sions, and founded his opinion in favor of the

I will take the liberty of noticing one or two State he represents, arising from the partial and other remarks which have fallen from different circumscribed knowledge he has of the subject gentlemen in the course of this discussion. In under consideration. this notice it is my wish to be brief, as the subject Gentlemen appear to have formed their judgment is so clear to my mind. My only wish is that I of the justice of the report of the Commissioners were the Representative of one of the creditor from what they themselves have seen or heard States, that I might plead with the greater effect of the sufferings of the respective States from the cause of the debtor States, believing, as I do, whence they came, during the Revolutionary war that this circumstance would not alter my opinion. with Great Britain.

While gentlemen repel the charge made by us Were I, Mr. Chairman, to take the same ground against the equitable operation of the settlement and point out to you—by taking a view of the of the Commissioners they acknowledge that set- sufferings of the State I have the honor to repretlement, so far as it regards their own States, to sent—the supplies she furnished and the services be unjust. Because they have not been allowed she rendered, it would appear that she would not a full indemnity for the services and supplies yield to any other State in the Union. they have rendered, they are unwilling to suffer But I acknowledge my information is too limthese balances to be extinguished so far as they ited to form my opinion from this source. I conbear hard upon the debtor States. They say, be- sider the Commissioners who settled the accounts cause they have suffered, they desire some com- between the United States and the individual panions in their misery. I do not think this a strong States, and who reported those balances, as havargument in their favor. On the contrary, I con- ing been men of talents, knowledge, and integsider it as one of the strongest arguments for an ex- rity, mutually chosen by all the parties concerned; tinguishment, as by the acknowledgment that the and that each State, by their agent, furnished operation of the settlement is unequal, it lessens the them with the evidences of their respective claims, obligation of the Government to adhere rigidly to it. and therefore as standing on higher ground than

Let us then put this subject on its true grounds, any member on this floor, and possessed of more let us view these balances, as they ought to be information on this subject than this House colviewed, as not worth a pepper-corn to the Union, as lectively. not worth the time that is spent in this discussion; It was well observed by the gentleman from and, under this view, let gentlemen be asked what. Delaware who introduced this resolution into the they sacrifice by giving them up. They abandon House, that those balances were occasioned by, nothing that is valuable; while on the contrary or grew out of the war. It was a common danthey throw away the last apple of discord, and ger, sir, that pressed these States into the Union pave the way to the final closing of this unplea- for their mutual defence against a powerful enesant business.

my. The old Congress under these circumstances But it is contended that the moment you ex- entered into a Confederation, and resolved, that tinguish these balances, you revive a right in the to defray the expense of the war, on final settleUnited States to call on the creditor States for a ment, each State should bear its just proportion repayment of the balances funded in their favor. of the expense of the war, according to the prinBut surely this cannot be considered as a natural ciples therein prescribed.' In pursuance of this inference. Is such a principle assumed as the object Commissioners were appointed, and several ground on which our arguments in favor of the laws have been passed by Congress for the purextinguishment rest? Have we not, on the other pose of carrying those resolves into effect. hand, declared and pledged ourselves, that so far I consider, Mr. Chairman, the settlement just, as regards the balances reported in favor of the from the subsequent acts of the National Legislacreditor States, it is our desire that they may re- ture. The report of the Commissioners was acmain sacred forever. Those balances have been cepted by the parties concerned, and the balances funded, and interest has been and is now re- due the creditor States funded. But they went ceiving on them. They were given for their ex. further; the State of New York actually paid ertions in the common cause, and ought therefore about $250,000 in part of the debt due from her. to remain untouched. Besides, in the bill which The Legislature of Pennsylvania made provision will be brought into the House should this reso- for the payment of the whole sum due from that lution pass a clause can be inserted making the State. North Carolina, another debtor State, and stock now held by creditor States transferable to who was so much opposed, if I am rightly inwhom they please. Forgive us our balances and formed, when she ceded to the United States a you heal the only remaining wound of the Revo- part of her territory, now the State of Tenneslution. With this view of the subject we ask see, bound the citizens of that district to pay gentlemen, yielding to a liberal and magnanimous their proportion of this debt. This, however, I spirit of accommodation, to agree to extinguish am not certain of ; I have it only from informathat debt whose continuance cannot benefit them, tion. If I am wrong, the gentlemen from that while it seriously injures us.

State will correct me.


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