CHAPTER XLII.

In the unavailing effort for self-protection by retaliatory commercial regulations, New Hampshire followed the example of Massachusetts.

The acts of both these States, as has been seen, were infractions of the treaty with France. A similar policy was pursued by Rhode Island.

These laws proved the inefficiency of State legislation. During their operation almost every foreign vessel, destined for those States, sought other ports. A commerce of great value was lost, and with it the revenue which had in part prompted to the discrimination.* These restrictive enactments were soon repealed, and thus all the injuries were suffered, which are the fruits of precipitate legislation.

But these evils had a wider influence. The laws levying imposts disregarded all uniformity, both as to the rates of duty, and as to the articles on which they were charged.†

* Representations were made to the Virginia legislature that her commerce had passed into other States, and that what she lost, Maryland gained by her lower duties.

The disparity of the duties is seen in the fiscal provisions of the Southern States, whose interests at that time approximated. Maryland levied one shilling and sixpence per ton on goods of those in treaty, two shillings and eight pence on those not in treaty, on British goods, 6s. 8d., and two shillings extra per ton on other goods. Virginia laid three shillings and sixpence on those in treaty, six shillings and sixpence on those not in treaty, besides two per cent. South Carolina, two shillings and ninepence on British sugars, one shilling and eight pence on those of other nations.

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The consequences of this inequality were soon felt, but instead of looking to the want of uniformity, as the radical source of the mischief, the wildest remedies were resorted to. Oppressive penalties, accumulated oaths, multiplied revenue officers, extravagant and partial exemptions-the obvious resources of ignorant legislation-followed; and when these failed, the states were seen competing with each other in a reduction of duties, in order to secure a preference to their own ports. Another consequence of this disordered state of things was the negotiation of commercial leagues, growing out of geographical causes, between the states of New-Jersey and Pennsylvania, and of Maryland and Virginia, in direct contravention of the sixth article of the confederation. The remedy for these evils had been recommended by congress-the investing them with a general power for the regulation of commerce. The delay to embrace it is more decisive than any other fact of the irrational adherence to state rights. Only four states had fully complied with this recommendation. Six had enacted laws clogged with embarrassing conditions Two had wholly disregarded it.

How narrow were the views which could not see the advantages of an unrestrained intercourse between the states, thus increasing the variety of exports, and enlarging the field of commercial enterprise! How blind the jeal ousy which, in withholding a central power to regulate commerce, overlooked the obvious facts, that, intersected as the states are by deeply penetrating rivers, or divided by artificial boundaries, no efficient guards against illicit trade could be interposed by means consistent with the maxims of a mild policy, and with a moderate expense; and that the necessary expense would compel a resort to harsh and onerous systems of taxation; that thus the states "would be obliged," in Hamilton's language, "to strengthen the executive arm of government, in doing which their consti

tutions would acquire a progressive direction towards monarchy."

At the meeting of the legislature of New-York, in the year seventeen hundred and eighty-four, Governor Clinton proposed an enlargement of the powers of congress, if necessary, to counteract the British proclamations. He also suggested the establishment of funds to pay the interest and discharge the principal of the state debt, and indicated as means, exclusive of direct taxation, the sale of the public lands, internal duties and excises, marine passes, and a tax on sales at auction. The suggestion as to the enlargement of the powers of congress, was not acted upon.

The state preferred exercising a control over its commerce, and having established a customhouse, passed an act regulating the customs. This act imposed a double duty on distilled spirits imported in vessels having a British register, but made no other discrimination. A similar duty was, during the next year, proposed on all imports in vessels owned in whole or in part by British subjects, unless, for the purpose of encouraging navigation, such vessels were built within the state.*

Sensible of the necessity of conferring this power on the confederacy, General Schuyler opposed this act in the senate, and Duer in the assembly. It was negatived by the council of revision, on the ground "that every attempt by a state to regulate trade without the concurrence of others, must produce injury to the state, without any general good; that partial duties would lead to countervailing duties, and that state legislation on this subject, would interfere with and embarrass the commercial treaties." It nevertheless became a law.

Congress had, in April, 1784, recommended the grant of a general power to them for this purpose. This local act was passed in the following No. vember.

Assured that the conferring on congress the sole power of commercial regulation, would be an important step towards the institution of a more efficient government, Hamilton is now seen again exerting his influence. The chamber of commerce were advised to petition the legislature. A large meeting was convened in New-York, which was earnestly addressed by him, and passed resolutions recommending the measure. Circulars were issued to the other states, and a correspondence opened, which urged an enlargement of the powers of congress to enable them to regulate trade and to establish a navy.

The legislature yielded to these combined efforts, and at the end of the session of seventeen hundred and eighty-five, passed an act to vest congress for a term of fifteen years with power to prohibit the importation or exportation of articles of commerce in the vessels of states "not in treaty," and also to prohibit the subjects of any foreign state, not in treaty, from importing any goods or merchandise, not the produce or manufacture of the sovereign whose subjects they were. But an express proviso was annexed, excluding the United States from collecting any revenue or duties within the state, without the sanction of its legislature.

The delay of New-York to concur in this measure of general relief, had created great excitement in the adjoining states of New-Jersey and Connecticut. The former declared Perth Amboy and Burlington free ports, and offered special exemptions to merchants removing thither, as lures to commercial capital. In Connecticut, such was the discontent, that an entire prohibition of all intercourse with its southern neighbour was proposed, and would probably soon have been attempted.

While this conflicting legislation prevailed in the various states, the patience of the suffering people was nearly exhausted. In several, the debtors were seen striving to obtain an ascendency in the legislatures, and by suspension acts to

delay the collection of debts; and a general disposition was discovered, notwithstanding its evils had so recently been felt, to seek relief in state emissions of paper money.

A majority was found in New-York, in despite of the most earnest remonstrances through the press, in favour of the issue of bills of credit, which were declared a legal tender, and a discrimination was contemplated among the different classes of creditors. Two-fifths of the debt due by congress to the state were to be provided for, and the claims of the army, of the holders of the loan-office certificates, and of the board of treasury, were to be turned over to the exhausted exchequer of the union,-thus by dividing the interests of the creditors, to weaken one of the principal supports of the continental system. A bill for the emission of state paper also passed the assembly of New-Jersey, but was rejected by the council through the firmness of Governor Livingston. So great was the popular excitement against him, that this virtuous patriot was loudly decried and burned in effigy.

South Carolina adopted a similar policy. Every effort was made by its citizens to sustain the credit of the paper; but such were their impoverishment and discord, that it was thought necessary to pass laws tantamount to closing the courts of justice. North Carolina and Georgia* followed this vicious example. Thus, of the southern states, Maryland and Virginia only escaped the contagion.

Rhode Island, whose conduct had become a reproach to its inhabitants, did not merely issue a state paper, but finding it rapidly sinking, passed laws, rendering a refusal of it at specie value highly penal in the first instancedeclared that a second offence should be followed by disfranchisement, and created special tribunals to try the

The paper of North Carolina is stated to have depreciated 25 per cent; that of Georgia and Rhode Island, 80 per cent.