I adduce these facts to show in what light Con- | gress viewed this subject at the time when the Commissioners made their report. I presume the National Legislature at that time, though less in number, were as competent to judge of the justice of the settlement as this House now is, though more numerous. But gentlemen in favor of extinguishing the balances, say the debtor States will not pay; and if they would, that there is no way pointed out for them to do it. If they will turn to the act of Congress passed February 15, 1799, they will there find that there is a way provided by law for these balances to be paid. I am opposed to the resolution to extinguish, because it tends to weaken and destroy the confidence of the citizens of the United States in their Government, for the hand that would blot out the balances due from the debtor States has the same power to wipe off the whole debt funded in favor of the creditor States; the principle is the same, for if the report be unjust as to the debtors, it is so as to the creditors. But the gentlemen ask, what advantage is there in holding those balances hanging over their heads? I answer, I consider them as a security for the payment of the debt already funded. Believing as I do that the settlement made by the Commissioners between the United States is as just as the nature of the case and the difficulties attending it would admit of, I hope the resolution on your table will not prevail. Mr. VARNUM.-The resolution under consideration is for the extinguishment of the balances due from several of the individual States to the United States, as appears by a report of Commissioners appointed to adjust and finally to settle the demands of the several States for services rendered and supplies furnished the United States in the late Revolutionary war with Great Britain. This report was made on the 5th day of December, 1793. The whole amount of the balances due from the debtor States, and which is now proposed to be extinguished, is $3,517,582. This resolution is supported on the ground that the settlement was unjust, and consequently that the balances found by it were improper and not due; and in fact, sir, I cannot conceive of any other ground on which an extinguishment could be supported. for it is evident that the debtor States are not deficient in ability to pay that which they justly owe; and if not deficient in ability, surely no other consideration can be sufficient to exonerate them from the payment. No principle, either political or moral, can justify an individual or a State in holding property justly due to another without the consent of the individual or State to whom it is due. In order to establish the position that the settlement was unjust, the gentleman from Delaware (Mr. RODNEY) has produced a document from the Comptroller of that State to show that Delaware did comply with the requisitions of Congress for a part of the time in which the United States were engaged in the war. And if it is granted that the statement is true, does that prove that the settlement was un H. OF R. just? No, sir, nor would any documents which can be produced of the services rendered by that State go to prove the fact without contrasting them with the services rendered by the other States in the Union; and gentlemen very well know that this cannot be done without a revision of all the documents of the services rendered and supplies furnished by each State in the Union during the whole of the war. Will Congress undertake to do this? If they will not, the documents which the gentleman has referred to must go for nothing. In fact, sir, they prove nothing relative to the question under consideration. Several other gentlemen have expatiated on the services rendered by the debtor States to prove that the settlement was unjust; and, sir, I might with as much propriety go into a detail of the services rendered by the State which I have the honor in part to represent on this floor to prove the reverse; but this might also be considered irrelative to the question before you. Yet, as gentlemen have taken this ground, in justice to Massachusetts I shall be permitted generally to say that she was second to no State in the Union in point of exertion for the general defence during the whole of the war. Her exertions in furnishing men and supplies were general, uniform, and ithout a parallel. History does not in my opinion, since the first formation of civil government, give you an instance of any people ever having paid, according to their numbers and wealth, in the same length of time, so great an amount in specie value as was paid by the way of direct taxes by the people of Massachusetts in the ten years the next subsequent to the year 1777. At the close of the war, towns and individuals were deeply involved. in debt, which had grown out of their exertions to furnish supplies for your armies, and to hire soldiers to fight the battles of the country, at a time when the credit of the nation could not produce them. The pressure of those debts, and the exorbitant taxes which had been unavoidably imposed by the State, drove the people into an insurrection, which, for a considerable time, assumed an aspect which threatened the destruction of all the fair prospects which had been acquired by the Revolution; but, thanks to Heaven, this insurrection happily subsided. But notwithstanding all their exertions, the assumption of a part of the debt by the United States, and the payment of the balance found due on the settlement in stock of the United States, yet, after all, the State was burdened with an unwieldy debt, which grew entirely out of the transactions of the war, and for the gradual extinguishment of which a heavy direct tax has from that period to the present time been annually imposed on the people, and must continue for years to come before the debt can be entirely extinguished. This being the case, while some of the debtor States have glided easily along without the imposition of a direct tax to the amount of a single cent for the discharge of the expense of the war during the many years which Massachusetts has labored under this pressure of taxation, has induced gentlemen the best informed on the subject to doubt whether the services of that State had all been taken into the account; but, sir, although the settlement was supposed to bear hard on that State, the people were determined to make the best of their situation, and not complain of a settlement which was made under so much solemnity, and, as they conceived, with the most upright intentions, so far as the perplexed state of the accounts would permit, to do equal justice to all the States. JANUARY, 1804. ing from the merit of any State to say, that the exertions of some of the States exceeded those of others. It is well known that in some of the States many of the citizens were inimical to the cause in which we were engaged, and did all in their power to assist the enemy in subduing our common country. This was a misfortune, although local in its operation, that was general in its effects, and it was generally lamented. Yet it did by no means detract from the merit of those citizens who were friendly in the same States; but it goes to show that those States in which it happened did not, nor could not, do as much towards the common cause as those who had nothing of the kind to impede their exertions; and, consequently, the improbability of the settlement being unjust as it relates to those States which stand the most indebted to the United States. The honorable SPEAKER, in order I presume to enforce on the minds of the gentlemen of this House the injustice of the settlement, has stated that the Commissioner of the great middle department has, since the report was made, stated on the floor of Congress "that those balances ought to be extinguished, and if it were not done, that he would unfold a tale which would make the hair stand on end, or some strong expression of that kind." The SPEAKER did not mention The ordinance which passed the old Congress the name of the Commissioner who he said had in 1787, authorizing the settlement of the accounts uttered this sentiment; but being so clearly desig- of the several States against the United States, for nated that every gentlemen present must know services rendered and supplies furnished during the the Commissioner alluded to, there can be no war, makes as ample and liberal provision for an harm in mentioning his name; I conceive it must allowance of all the accounts exhibited, as could be General Irwin. When I look at the report and possibly be expected, or even asked, by any of the find that General Irwin is the first Commissioner parties to the settlement: it was founded on the who signed, it is difficult for me to reconcile the principles of mutual compromise, and by the unanstatement of the honorable Speaker with this doc-imous consent of all the States. By the condiument; and when I recur to a more recent tran- tions of the settlement agreed upon by that ordisaction, I am confident there must have been some nance, the public faith of each State was solemnly misunderstanding in regard to the General's dec- pledged to all the other States, and the public faith laration. (for I am sure the honorable SPEAKER of the United States was solemnly pledged to each would not intentionally misrepresent it.) General individual State, that the settlement, and proporIrwin did not only sign the report of the Commis- tion of the debt allotted to each State, by the Comsioners, but there is at this time a letter in the pos- missioners thus mutually agreed upon and chosen session of a gentleman of this House written by by all the States, should be final and conclusive. General Irwin since the commencement of the Soon after the establishment of the present Govpresent session of Congress, and to which his sig- ernment, in the year 1789, a law was passed by nature is subjoined, stating that all possible pains Congress for facilitating the settlement and for was taken by the Commissioners to do equal jus- filling vacancies in the board agreeable to the printice to all the States in that settlement. ciples of the ordinance of 1787, and so far as I Now, sir, will this Committee conclude that have discovered by a recurrence to the Journals, General Irwin had, ten years ago, any frightful this law passed without any opposition. In 1790 tale, to develope which would evince the injus- Congress again assumed the consideration of the tice of this settlement? Or will they not rather subject, and passed a law which recognised all the conclude that his signature, subjoined to the report principles of the ordinance of 1787, and provided under the solemnity of an oath, (for all the offi- that a distribution of the whole expense should be cial transactions of the Commissioners were done made among the several States, according to the under that solemnity,) together with his state-first census under the present Constitution. This ment in the letter which I have mentioned, afford law was also passed by the almost unanimous consufficient evidence that he has always considered sent of the House, and in the Senate, where the the settlement a just one? Another objection to State sovereignties are more particularly reprethe justice of the settlement is, because the ex-sented, it appears by the journals to have passed pense of the war was not apportioned among the without opposition. Thus, sir, from the first agreeStates by the value of their lands, agreeably to an ment of 1787 to the final close of the settlement, article of the Confederation. It is an old adage all the States were unanimous in the mode prethat consent takes away error, and it is true that scribed for settlement, and stood most solemnly that mode of settlement was adopted by the unan- bound to each other to abide by it; and the public imous consent of all the States. When a recur- faith of the nation was, by the several acts of Conrence is had to the history of the whole transac-gress on the subject, most solemnly pledged to tion, I believe it will be found that this objection carry it into effect. has no weight. Sir, I am far from entertaining Can the Legislature then relinquish these bala wish in the least degree to depreciate the exer- lances, without a violation of plighted public faith? tions of any State in the Union in the Revolu- And yet will they undertake to do it? Sir, it is tionary war. I know they all made great exer- a fundamental principle in the governments of all tions. Yet, sir, I presume it will not be derogat-civilized nations to pay the most sacred regard to plighted public faith. And, sir, the friends of our Government have derived much consolation from the idea, that the United States would never suffer their national character to be stained by a violation of this important national principle. Yet, sir, from what has taken place, it has been believed, that the United States would not be behind any nation on the earth in the preservation of this public virtue. But, if the resolution on the table should be passed into a law, this valuable principle will receive a wound which may lead to fatal consequences. I must be permitted to doubt the power of Congress to extinguish these balances without the concurrence of all the States. The settlement having been made under a solemn agreement of all the States, where will you find a power vested in Congress to alienate the interest which any individual State has acquired in the balance in consequence of that agreement, and vest it in another State? No such power is expressed in the Constitution, nor can I conceive it to be implied by anything which is expressed in that instrument. If then Congress have no Constitutional power to make the extinguishment, will not the transaction be considered an innovation on the rights of individual States, as well as a dereliction of the public faith? A gentleman from New York has said that the extinguishment could not be a violation of public faith, because Congress had already given up part of the debt. It seems to me that the gentleman's conclusion does not naturally follow the premises which he has stated, for if it could. under any circumstances, be considered a dereliction of public faith to extinguish these balances, it cannot at this time be considered the less so, merely on the ground of the Legislature having heretofore fallen into an error on the subject. The fact is, that Congress did, in 1799, pass a law for remitting the balances, on condition, that each debtor State would pay into the Treasury of the United States by a given period the amount of the sums which had been assumed by the United States, of their respective State debts prior to the settlement. But, sir, at the time of passing that law, and ever since, I have considered it in the same point of light as I do the resolution before you, and therefore cannot admit that as a circumstance in favor of the resolution. That provision has now expired, without being embraced by any of the debtor States, except in that which has been done by the State of New York, in fortifying her ports and harbors. If the State of Delaware had thought proper to have complied with this liberal provision, she might have been discharged from a debt of $600,000 for $60,000, but it seems that she prefers a total extinction to a partial payment. If the balances should be extinguished on the principle that the settlement was unjust, which is the only ground taken in favor of their extinguishment, I am apprehensive that this is only to be a stepping stone to a more favorite object. I mean the extinguish ment of the balances due to the creditor States on the settlement: for, although these balances have been funded by the United States, it is well known that the evidences of the debt in the possession of H. OF R. the creditor States are not transferable, so that Congress will have nothing to do to effect this part of the business, but to order payment to the creditor States on those balances to be stopped. And if this House shall consider the settlement so entirely unjust as has been stated by some gentlemen, and in consequence thereof give their vote for the extinguishment of the balances due from the debtor States, I cannot conceive why the same principle might not with the same propriety be extended to stop payment to the creditor States; nor should I be surprised, if the one should be carried, at seeing a resolution laid upon your table, before the close of the present session, for effecting the other. And will not the same parity of reasoning which has been adduced on this occasion lead to the extinguishment of all the debts of the Nation? If $3,500,000 due to the United States is to be wiped off on a mere statement on this floor, that the settlement was unjust, without the least particle of evidence to prove the fact, will a pretext ever be wanting for passing sentence against any class of your public debt? Sir, I have always been an admirer of the system of government extablished in the United States. I have thought it the best calculated of any government on earth, to perpetuate national faith, and secure individual rights. I have entertained exalted ideas of the wisdom and economy of the present administration, and I have consoled myself on the pleasing prospects of the future prosperity and happiness of our nation. But, sir, I view the measure before you as calculated to veil those pleasing prospects, and excite fearful apprehensions for the honor and fate of our country. The resolution was further supported by Mr. J. CLAY, and opposed by Mr. FINDLEY, and Mr. BEDINGER. Mr. Roor begged the indulgence of the House, for a few moments, while he briefly stated some of the reasons which guided his judgment in favor of the resolution on the table. Coming, as he did, from a State against which a large balance had been reported by the Commissioners, it would probably be expected that he should lend his feeble efforts in aid of its extinguishment. But, while making these efforts, he should not call in question the conduct of the Commissioners in striking these balances, nor inquire whether they were actuated by pure or impure motives. As the balances have been for a long time reported, and as the proceedings of the Commissioners, as well as the documents and vouchers on which they acted, are secluded from the public eye, he should suffer them all to rest together undisturbed, and confine himself to the justice and expediency of the measure. If, said Mr. R. there is no probability that the debtor States, so called, will ever pay the balances reported against them, wisdom and sound policy require the passage of this resolution; else they may remain a source of future jealousy and hatred between the several States, and a subject of management highly prejudicial to the Union. Or are they, he inquired, to remain as a rod over the debtor States to whip them into compliance with some favorite measure? If this was the object, he H. OF R. State Balances. JANUARY, 1804. thought it prudent to extinguish them at once. and that she has actually expended in the defence The national Treasury, he said, can never be en- of the port of New York, and for which she is riched from this source, unless a voluntary pay- credited on the books of the Treasury, to the ment shall be made by the debtor States, or the amount of $220,000, and that thereby she has acUnited States shall. by coercion, compel a pay- knowledged the justice of the demand, and will ment. And although, according to the report of pay the residue. But, let gentlemen remember the Commissioners, there are several States which that, at that time, a momentary frenzy had seizare nominally debtor, yet there are but three, viz: ed upon the people of the United States, to wage New York, Delaware, and North Carolina, which war upon the Republic of France. And was it are, by that report, really debtor. And a volun- strange, he inquired, that the Legislature of that tary payment on the part of those States cannot State caught the contagion? When the General reasonably be expected: For you are told, Mr. Government had either refused or neglected to Chairman, that Delaware cannot pay; and you fortify her ports, was it strange that she should are also told, by two honorable gentlemen from attempt to defend herself against the danger of an North Carolina (Mr. BLACKLEDGE and Mr. HOL-invasion, then supposed to be imminent? Since LAND) that that State will not pay-and as one of that frenzy has subsided, it is presumed that New the Representatives from the State of New York. York will not make a further waste of money, in I think I may with confidence assert that she will compliance with the terms of the act of 1799. make no farther payment. She yet remembers, And, besides, sir, should the debtor States, for a sir, that at the commencement of the Revolution moment, suppose the settlement to have been nearly one half of her citizens were inimical to that equitably made, and that the balances are justly cause which you venerate. She yet remembers, due, we should probably find each State withthat early in that revolution her only avenue to the holding a payment till other debtor States had ocean was blocked up, and by that and other causes, paid the balance reported against them. Thus, by growing out of the existing state of things, the each State's waiting for others to go forward, you price of her produce, and of her supplies furnished would find that no payment would be made. If to the army, was deeply depressed. That State you can have no reasonable expectation that these was the theatre of war almost during the whole balances will ever be voluntarily paid, why retain conflict. Her western frontiers were burnt and them on your books? Do you intend, by coerpillaged by a savage foe, and her southern borders cion, to compel a payment? In what manner, I overrun by worse than savages. From her north- beg to know, will you institute suits against the ern frontiers a formidable enemy penetrated into debtor States? Will you bring a State sovereignty the very bowels of the State. Surrounded by to bend at the feet of your courts? I presume these distressing scenes she not only raised her not, since you have amended the Constitution regiments and paid her quotas required by Con- respecting the suability of States. Will you segress, but also set apart, as bounty lands for her quester their stock in the funds, if they should soldiers, a large tract of the most fertile part of the happen to hold any, and thus violate the national State. After having done and suffered so much, faith? And will you lay a direct tax upon the she could not but view with astonishment that United States, and remit the same to the creditor enormous sum of more than two millions of dol- States, and thus indirectly evade the Constitutionlars which was reported against her. Further, al provision that direct taxes and representation Mr. Chairman, the State of New York cannot be shall be according to a certain ratio? Or will you, lieve that the act of Congress of the 15th of Au- as the last resort, put the debtor States out of your gust, 1790, pointed out a fair and equitable mode protection, and send your fleet to block up their of setttlement. When men and money were called harbors? I presume you will not, especially when for, to carry on that war in which these expenses you reflect that the people of New York alone were incurred, that State had not more than half pay more than one-fourth of all your duties on the population which she possessed at the time imports and tonnage. This is too considerable an this act was passed. The quota of expenses, there- item in your revenue to be wantonly thrown fore, which were charged to her according to this away. ratio, were nearly double to what it would have been, had a settlement been made, by the same ratio, at the close of the war. Had her quota been fixed according to her population at that period, it is presumed that she would have been reported a creditor instead of a debtor State. That State must therefore think that this enormous balance is an unjust and an unreasonable demand. And if she thinks it unjust, it is enough; for whether the settlement is just or unjust, if a State thinks it unjust the result is the same; she will not voluntarily pay. But, said Mr. R., perhaps we shall be told that the State of New York has already made appropriations for complying with the terms offered by the act of Congress of the 15th of February, 1799, But, Mr. Chairman, it has been suggested that the enormous balance reported against the State of New York proceeds from the assumption of the State debts, and that she is bound in honor to pay, and will pay, the amount assumed for her. In reply to this suggestion, permit me to remark, that the sum which was assumed for her was not equal to her proportion of the aggregate amount of State debts assumed. The sum assumed for New York was $1,183,716 69. The aggregate amount assumed for the several States was $18,271.787 47. Hence, it will appear that, according to the ratio for settling the accounts as established by the act of 1790, the proportion of New York of that aggregate sum is $1,715,169 78; which is $532,453 09 more than the sum assumed for that State. Less sums were also assumed for Delaware and North Carolina than their respective proportions of that aggregate. Another objection is made to the resolution on your table, that its passage will affect the credit of the creditor States; and one gentleman from New Jersey (Mr. SOUTHARD) has gone so far as to say that the same power which can extinguish these balances, can wipe off the whole funded debt; and my friend from Massachusetts (Mr. VARNUM) expressed a belief that the passage of this resolution is a violation of public faith. But I must confess, sir, my total inability to perceive the force of these observations. If Congress possess the physical power by one Legislative stroke to wipe off the whole funded debt, yet, if that power cannot rightfully be exercised, I trust it will not be exercised at all by this House. And I cannot see that, because you remit to your debtor that debt which he claims to be unjust, you thereby destroy the credit of your creditors. Or, does it necessarily follow that if an individual remits the supposed debt, that he, by the same act, destroys the bond of his creditors? Those States in whose favor balances were reported have funded those balances, and the national faith is pledged for the payment. And I trust that this nation will continue to preserve its faith inviolate. Permit me, sir, to add, if the extinguishment of these balances is a violation of public faith and a destruction of the credits of those States who have funded the balances reported in their favor, that that faith is already violated and those credits are already destroyed. For, by the operation of the act of 1798, had the debtor States complied with its proffered terms, the balance against New York of more than two millions, with interest, would have been paid with less than eight hundred thousand dollars, and the six hundred and odd thousand dollars against Delaware would have been paid with about fifty thousand. And the same principles which gave you a right to remit a part, gave you a right to remit the whole. If the extinguishment of the whole will give a deadly blow to public faith, I should think that the remission of so large a part had, at least, inflicted a mortal wound. From a full view of this subject, Mr. Chairman, I am convinced that if you retain these balances as a rod over the debtor States, you will only excite jealousy and animostity among the members of this Union, without deriving any benefit to the nation. Permit me, therefore, to express a hope that a majority of this Committee will be in favor of sponging them out of the books of the Treasury. Mr. LEIB said that he never rose to give an opinion on that floor but with reluctance, and he should not then have risen but for the demand of the yeas and nays on the question. As he had heretofore voted against a similar proposition to that on the table, he felt it a duty he owed himself, as the vote was to be recorded, to assign his reasons for rejecting the report of the Committee of the whole House and voting in favor of the resolution. This is not a new question. It had been re H. OF R. peatedly before Congress and before the public since he had had the honor of a seat on that floor. He should not inquire whether the accounts upon which the balances were predicated had been fairly liquidated or not; whether the sums were justly due; nor should he examine which of the States had rendered most services to the nation. These considerations with him bore not upon the case. The question had simplified itself to his mind and lay in a narrow compass. It had resolved itself into this: Can or will these balances ever be paid? If they cannot, nor will not be paid, there ought to be an end to the inquiry, and an end to the demand. It had been said, during the discussion, by a gentlemen from New York, that when this subject was formerly under consideration, New York sold out the stock which she held in the funds of the United States, lest it might be sequestered for the payment of her balance. Can anything evince a stronger hostility to the pay. ment of this claim than this fact? And yet, with this open declaration against the payment of the balance due by her, we are to persist in continuing the claim! As New York has manifested her determination not to pay, what mode of coercion has been suggested? None. No one has pretended to say that these balances ever can, or ever will be collected. If New York and North Carolina will not pay, can Delaware discharge the claim against her? With her what process is to be pursued? Is she to be sent to auction and sold to the highest bidder? And if gentlemen are willing to put her under the hammer of the auctioneer, who is to be the purchaser and how is the sale to be enforced? The justice of these balances has been contested, nay, it has been flatly denied; it is not to be expected, therefore, that the debtor States would willingly discharge them, and as no feasible mode of enforcing payment has been or can be suggested, policy and economy call for their extinction. It would be well for gentlemen, who are for keeping alive this demand, to calculate its cost to the nation, and then, perhaps, they would feel less reluctance to the surrender. Large sums are spent in the discussion, and the time and the purse of the people very unprofitably employed. In his apprehension, therefore, it would be a saving to the United States to pass the resolution. It is idle to keep up a demand which never can nor never will be satisfied; he hoped, therefore, the House would agree with him in rejecting the report of the Committee of the Whole and adopting the resolution. Mr. HOLLAND. It is to be expected that gentlemen representing various parts of the Union, and particularly those who were eye-witnesses to the hardships experienced under the Revolutionary war, will be led to think that the distresses they saw, and the exertions performed immediately within their own view, were not equalled in any other part of the continent. That this is the case, we have sufficient evidence by the declarations of many honorable gentlemen on the present question. A gentleman from Massachusetts (Mr. THATCHER) has said, that the States of New |