main creditor of fuch ftates as by the final account appeared to be debtors.

The return of the commiffioners, as we have already feen, makes the balances due to certain fates, namely, New Hampshire, Maffachusetts, Rhode-Ifland, Connecticut, New Jerfey, South Carolina, and Georgia, amount to three millions five hundred and feventeen thoufand five hundred and eighty-four dollars; and thofe due from the other ftates, namely, New York, Pennfylvania, Delaware, Maryland, Virginia, and North Carolina, to the fame fum.

Mr. GALLATIN, in a work of great reputation on the finances of the United States, which he published in 1796, fpeaks in the following manner of this meafure. "The ftates, whofe debts amounted to the greateft fums, were, by the operation of this plan, found to be the most confiderable creditors of the Union. And experience bas fhewn, that this great addition of debt with which the Union has charged itself, far from giving ftrength to the federal government, has occafioned more difcontents than any other meafure; not only by the impofition of new taxes pay the debts, but ftill more by an apprehenfion, that perfons in power will feek rather to augment and perpetuate the debt of the Union than to extinguish or diminish it; and from a ge-

to

neral

neral belief, that the fpeculations and interefts of individuals had more influence in the adoption of the plan than any other confideration. And although it may feem indifferent, whether the fums neceffary to discharge thefe debts be levied on the people by the federal government or by the feveral states, yet the difficulty the federal government finds in augmenting its revenues by the excife, licenfes, &c.-the rapid progrefs which individual ftates have made for the extinction of their refpective debts, and the fituation of the ftates whofe debts were not adopted by the Union, because they were on the final account its debtors, are fufficient proofs, that a great part of the additional debt which now refts on the Union would at this day have been extinguished by the refources of the several states, if it had not been confolidated with that of the Union."

This writer adds-" That, had the confolidation of the debts of the feveral ftates with thofe of the Union been postponed till the final fettlement of accounts by the commiffioners, the debt of the federal government would have amounted to no more than eleven millions fix hundred and nine thousand two hundred and fifty-nine dollars, instead of twenty-two millions four hundred and ninety-two thoufand eight hundred and eighty-five dollars, which were acknowledged

and

and funded by the Union; and that therefore the congress, by its precipitation, created an unneceffary debt of ten millions eight hundred and eighty-three thousand fix hundred and twentyfix dollars."

The law that confolidates thefe different fpecies of debts, pledges the public faith for the eftablishment of funds for the payment of interefts granted on loans; and it fets apart lands belonging to the Union, in the territories of the west, to be fold, to create a finking fund for the extinction of the national debt.

A fum of a hundred and ninety-eight thousand dollars was due to foreign officers, who served in the American army during the war; and it was deftined to be paid out of the loans made in Europe, and has been faithfully discharged as far as claims have been made, which have amounted to a hundred and twenty-three thousand dollars.

Since the year 1790, the congrefs has erected an office for the reduction of the national debt, composed of the prefident of the fenate, the chief-juftice, the fecretary of ftate, the fecretary of the treasury, and the attorney-general of the Union. It authorised four different loans for the reduction of the debt, by the redemption of feveral funds; and, in 1796, authorifed the commiffioners of the finking fund further to borrow five

millions

millions of dollars, to pay certain fums and their interests, which the government were engaged to difcharge that year. The bank of the United States was authorifed, by the fame law, to furnish this loan, or fubfcribe to it in part. The funds already in existence were received as fubfcriptions to the loan; the commiffioners had a power to fell at their difcretion, the feveral forts of funds (three per cents, fix per cents, or deferred Stock) which they had in their hands, to discharge the whole, or part of the fums and interests that the loan was meant to extinguish, provided that they did not fell more than one half of fuch funds at a price below par; they were alfo authorised to fell the fhares of the bank which belonged to the Union. The new debt thus created by this loan, the receipts for which bore an intereft of fix per cent, was not to be redeemed till the commencement of the year 1819.

The congrefs had incorporated the bank of the United States; and that bank had afterwards advanced to the Union two millions of dollars, to which amount the Union had fubfcribed in the formation of its capital, and thefe two millions were to be repaid in ten years, by equal payments. The congrefs afterwards authorifed that bank to advance the Union three millions more; and again, five millions, in 1796, as I have be

fore

fore obferved; and declared the revenues of the ftate to be subject to the payment of the intereft of these loans, in the fame manner as to the other expences of the government; and deftined all furplus of the revenues to be a fund for the repayment of fuch loans.

The debt of the United States, in 1790, amounted to feventy-two millions fix hundred and thirteen thousand two hundred and fiftyfour dollars; and in 1796, to feventy-eight millions fix hundred and ninety-feven thousand four hundred and ten dollars. It has therefore increased by the fum of fix millions eighty-four thousand one hundred and fifty-fix dollars, although the office for the reduction of the national debt had extinguished two millions three hundred and feven thoufand fix hundred and fixtyone dollars, and although the United States have in that period enjoyed a profound peace, and have been favoured with circumstances which ufually enable a state to restore order in its finances.

A greater economy in the public expenditure, the fale of immenfe quantities of lands belonging to the Union in the territories of the weft which is practicable, and a prudent increafe of impofts, are means that a wife administration would employ with effect to the fpeedy extinction of the

national