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would have terminated sooner, and would have cost vastly less both of blood and treasure, if the government of the Union had possessed the power of direct or indirect taxation.1 But the government of the Confederation was one that trusted too much to the patriotism and sense of honor of the different populations of the different States. The moral feelings of a people will prompt to high and heroic deeds; will impel them with irresistible force and energy to the accomplishment of the great objects of liberty and happiness; and will develop in individuals the highest capacity for endurance that human nature can display. They did so in the American Revolution. The annals of no people, struggling for liberty, exhibit more of the virtues of fortitude, self-denial, and an ardent love of freedom, than ours exhibit, especially in the earlier stages of the contest. But any feelings are an unsafe and uncertain reliance for the regular and punctual operations of civil government. The fiscal concerns of a nation, left to depend principally upon the prevailing sentiments of justice, honor, and gratitude, -upon the connection between these sentiments and that passion for liberty which animated the earlier struggles for national independence, -are exposed to great hazards. If an appeal to the feelings of a people constitutes the principal ground of security for the public creditor, other feelings may intervene, which will lead to a

1 General Washington's letter to Hamilton, March 31, 1783. Writings, VIII. 409, 410. Circular

Letter to the Governors of the
States, on disbanding the army.
Ibid. 439,

451.

denial of the justice of the claim; for it is the very nature of such an appeal to submit the whole question of obligation and duty to popular determination. That government alone is likely to discharge the just obligations of any people, which possesses both the power to declare what those obligations are, and the power to levy the means of payment, without a reference of either point to popular sentiment.

The history of the Confederation contains abundant proofs of the soundness of this position. At the close of the war, a debt of more than forty millions of dollars was due from the United States to various classes of creditors, and the whole of it had been contracted either by the government of the Confederation, or by its predecessors, for whose contracts the Confederation was expressly bound, by the Articles, to provide. This debt could not be discharged without a grant of internal revenues from the States, and without a grant of the power to collect other revenues from the external trade of the country. The appeal that was made by the government in order to obtain these grants was addressed almost wholly to the moral sentiments of the people of the different States; the time had scarcely arrived, although rapidly approaching, for an appeal to those interests which were involved in the surrender to the general government of the power of regulating foreign commerce;1 and consequently the arguments

1 None of the documents, connected with the Address to the People of the United States, issued

by Congress in 1783, discussed the question as one of direct interest and advantage, except Hamilton's

addressed to the sense of justice and the feeling of gratitude were answered by discussions of the propriety, justice, and reasonableness of some of the claims, for which the States were thus called upon to provide, as existing debts of the country, not without the hope, entertained in some quarters, of involving the whole in confusion and final rejection.2

The design of the framers of the revenue system of 1783 was twofold; first, to do justice to the creditors of the country, by procuring adequate power to fund the public debts; and second, to strengthen and consolidate the national government, by means of those debts and of the various interests which would be combined in the great object of their liquidation. They foresaw, on the approach of peace, that to leave these debts to be provided for by the States individually would lead to a separation of interests fatal to the continuance of the Union; but that to make the United States responsible for the whole of them would be to create a bond of union, that would

answer to the objections of Rhode

Island.

The Address itself appealed entirely to considerations of honor, justice, and good faith. Hamilton's paper, however, showed with great perspicacity, that the proposed impost would not be unfavorable to commerce, but the contrary; that it would not diminish the profits of the merchant, being too moderate in amount to discourage the consumption of imported goods, and therefore that it would not diminish the extent of importations; 24

VOL. I.

but that, even if it had this tendency, it was a tendency in the right direction, because it would lessen the proportion of imports to exports, and incline the balance in favor of the country. But the great question of yielding the control of foreign commerce to the Union, for the sake of uniformity of regulation, was not touched in any of these papers. The time for it had not arrived.

2 See note at the end of this chapter.

.

be effectual and operative, after the external pressure of war, which had hitherto held the States together, should have been removed. For this purpose, they undoubtedly availed themselves of the discontents of the army, a class of the public creditors the justice of whose claims there was immediate danger in denying. There is no reason to suppose that these discontents were promoted by any one concerned in giving direction to the action of Congress. But before the crisis had been reached in the "Newburgh Addresses," it was perceived to be extremely important to prevent the army from turning away from the general government, as their debtor, to look to their respective States; and, after the imminent hazard of that moment had passed, the claims of the army were used, and used most rightfully, to impress upon the States the necessity of yielding to Congress the powers necessary to do justice.1

In the proposal of this scheme of finance, involving, as it did, a material change in the operation of the existing constitution of the country, there was great wisdom; and it was eminently fortunate that it went forth before the advent of peace, to be considered and acted upon by the States. The system of the Confederation had utterly failed to supply the means of sustaining the public credit of the Union, and the consciousness of that failure tended to produce a resolution of the Union into its component elements, the States. Men had begun to abandon the hope of

1 See note on page 194.

paying the debts of the country; or, if they were to be paid at all, they had begun to look to the States, in their individual capacities, as the ultimate debtors, to whom at least a part of the claims was to be referred. Had the country been permitted to pass from a state of war to a state of peace, without the suggestion and proposal of a definite system for funding these debts on continental securities, the Union would at once have been exhausted of all vitality. The Confederation, left to discharge the functions which belonged to it in peace, without the power of relieving the burdens which it had entailed upon the country during the war, would have been everywhere regarded as a useless machine, the purposes of which -poorly answered in the period of its greatest activity-had entirely ceased to exist. Congress would have been attended by delegates from few of the States, if attended at all;1 and the rapid decay of the Union would have been marked by the feeble,

1 As it was, the approach of peace had reduced the attendance upon Congress below the constitutional number of States necessary to ratify the treaty, when it was received. On the 23d of December, 1783, a resolve was passed, "That letters be immediately despatched to the executives of New Hampshire, Connecticut, New York, New Jersey, South Carolina, and Georgia, informing them that the safety, honor, and good faith of the United States require the immediate attendance of their delegates in Congress; that there

have not been during the sitting of Congress at this place [Annapolis] more than seven States represented, namely, Massachusetts, Rhode Island, Pennsylvania, Delaware, Maryland, Virginia, and North Carolina, and most of those by only two delegates; and that the ratification of the definitive treaty, and several other matters, of great national concern, are now pending before Congress, which require the utmost despatch, and to which the assent of at least nine States is necessary." (Journals, IX. 12.)

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