The Debates and Proceedings in the Congress of the United States, First Congress, First Session, Volume 2 Page: 1,343
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1343 OF DEBATES IN CONGRESS. 1344
February .22, 1790.] Public, Credit. [H. of R.
States, and agreeing to-a part and disagreeing
to other parts; a message was sent to the Se-
nate informing them thereof.
PUBLIC CREDIT.
The House then resolved itself into a Com-
mittee on the. Report of the Secretary of the
Treasury, Mr. Baldwin in the chair.
Mr. Madison's proposition still under consi-
deration.
Mr. Page.—As the worthy and eloquent
member who replied to me did not answer the
questions I put to the committee, I suppose he
either did not hear them,did not understand me,
or could not answer them. I hope, before the
committee decide, they will attempt at least to
resolve them. I asked, where is the injustice
of the States complying with its engagements
«aade to the first holders of certificates, as far
as the case admits? Where is the justice of
doing more for the assignee than he or his as-
signor expected could or would be done? Where
is the breach of faith in Government, if it paid
its whole debt withjustice blended with mercy?
Where is the interference in contracts, when
the proposition is to comply sacredly, as far as
the case will admit, with the contracts between
a State and its creditors? I asked, is not the
assignment of certificates confirmed by the mo-
, tion? Does it not give to the assignee the very
thing stipulated to be given, that is, whatever
sum Government shall be pleased to pay for the
certificates, for that was the condition of the
assignment? And is not the sum now proposed
more than either the first or last holder, till
within these few days, supposed would be paid
him? I asked also, ought not an honest assignee
to be pleased that Government intends to do
that justice to his assignor which he ought to do
himself, were the whole payment made to him?
I asked, of what is the assignee deprived but of
his late sanguine expectation? I asked whether
the proposition before us does not rather esta-
blish confidence in Government than the con-
trary? For', sir, to make use of the comparison
which has been often made here between the
State and an obligor on a bond, what could
give more credit to any man's bonds than to
find that, though they had depreciated to half a
crown in the pound, he paid the whole twenty
shillings; ten shillings to the assignee, who had
given but two shillings and sixpence, and ten to
the obligee who had sold at so great a loss?
It is true Congress may, consistently with
the rules of common law courts, pay the bearer
and take no notice of the creditors; but were a
Court of Equity instituted to decide on the case
'of certain speculators, how would they decide?
Government, in the most solemn manner,
pledged itself to make compensation to the sol-
diers, have they done it? Instead of doing this,
certain persons, who took advantage of their
ignorance and their poverty, bought up the evi-
dence of their debt at one-eighth of their no-
minal value; and in some States these very men
had drawn what constituted the principal of
the purchase with six per cent, interest in three
years.
In what does the case differ between the de-
preciated paper and the certificates? Paper
money was redeemed at forty for one, as well to
the last as the first holder; the same principle
would lead to give the last holder of the certi-
ficate the depreciated value at which he bought
it. But we propose to work no injustice, we
give the first holder, if he is the holder still, the
full value stipulated. It would not be injus-
tice, to consider the assignee, as having paid
what he advanced, in consequence of his confi-
dence in Government," on account of that Go-
vernment: and that the Government ought to
repay him what he so advanced; having repaid
that sum, the balance ought to go to the credit
of the assignee. I am willing, on this conside-
ration, to call the speculator the friend and sup-
porter of the Government, who kindly lent us,
when in need ,two shil lings and six pence in ever^r
pound, to advance to the poor soldier- If certi-
ficates are the evidence of the debt, it proves, sir,
that the balance is due to him in whose name
it issued. This is the day of payment, and we
must pay accordingly; and here permit me to
remark, in reply to the observation of the gen-
tleman from New Hampshire. (Mr. Liver-
more) that Jacob was punishea for his fraud,
but for his faith enjoyed the promise; even so
let us regard those who had so much confidence
in us, as to advance two shillings and six pence
to the distressed soldier.
Mr. Heister was in hopes this question would
be postponed for the present, in order to go into
a consideration of the ways and means; when,
if it appeared that the United States were in-
capable of making full provision, it might be
considered, whether one deviation wouFd not
authorise the other? If any gentleman would
make a-motion to that effect, he would second
him.
The question was now taken on Mr. Madi-
son's proposition for a composition, and it pass*
ed in the negative; yeas 13. nays 36.
Mr. White observed, that the second reso-
lution proposed by the gentleman from Penn-
sylvania (Mr. Fitzsimons) was now before the
committee; he would wish to modify itj by de-
claring that permanent funds ought to be pro-
vided, instead of appropriated; because the
latter seemed to imply that. Congress were al-
ready possessed of the funds, which he believed
was not the case"; he also wished to extend the
resolution, so as to embrace the civil and mili-
tary establishments of the United States, leav-
ing the surplus to be employed in just propor-
tion to discharge the interest of the domestic
debt. The plan of the Secretary seemed to
contemplate the payment of four per cent, and
gave a preference to those who subscribed to«
his new loan; by this means, the original holder
who had retained his certificate, and who
thought his claim more meritorious than the
others, and who, in consequence, could neither
afford, nor would be willing to accept of either
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Gales, Joseph, 1761-1841. The Debates and Proceedings in the Congress of the United States, First Congress, First Session, Volume 2, book, 1834; Washington D.C.. (https://digital.library.unt.edu/ark:/67531/metadc29466/m1/36/: accessed April 19, 2024), University of North Texas Libraries, UNT Digital Library, https://digital.library.unt.edu; crediting UNT Libraries Government Documents Department.