the war in its last active year, Virginia far exceeded any other state in its emission of millions in paper money. After the victory at Yorktown, it ceased to vote new paper money. The old was declared to be no longer receivable, except for the taxes of the year, and it was made redeemable in loan office certificates at the rate of one thousand for one.* In retaliation for the most wanton destruction of property, British debts were not recoverable in the courts. For others it constructed a scale of depreciation in the settlement of contracts made in the six years following the first of January 1777. It had staylaws. For a short time it allowed executions to be satisfied by the tender of tobacco, flour, and hemp at a price to be settled every month by county courts. For a year or two lands and negroes might be tendered on judgments, but every contract made since the first of January 1782 was to be discharged in the manner specified by the contract. So Virginia returned to the use of coin. But in 1785 rumors went abroad that the assembly was resolved to issue a paper currency. George Mason, then in private life, scoffed at solemnly pledging the public credit which had so often been disregarded, and declared that, though they might pass a law to issue paper money, twenty laws would not make the people receive it.# At the end of the session Madison could write to Jefferson || that, though the desire of paper money had discovered itself, "no overt attempt was made!" It became known that Meriwether Smith and others, aided by an unfavorable balance of trade and the burden of heavy taxation, would at the next session move for a paper medium. Aware of the danger, Washington insisted that George Mason should be a candidate for the assembly; and his election proved a counterpoise to the popular cry. Again, quoting from his own circular of June 1783, that "honesty will be found, on every experiment, the best policy," he encouraged Bland to firmness. The subject of paper money was introduced in October 1786 by petitions from two counties, was faintly supported by "a few obscure patrons," was resisted as an encour * Hening, X., 456. + Hening, xi., 75, 76. + Ibid., 176–180. #George Mason to Washington, 9 November 1785. Works of Madison, i., 218. un agement to "fraud in states against each other," and "as a disgrace to republican governments in the eyes of mankind;" then, by eighty-five against seventeen, it was voted to be " just, impolitic, destructive of public and private confidence, and of that virtue which is the basis of republican government." The words show the mind and hand of Madison. 66 There was need of a new bill on the district courts, but it was clogged with the proposal for the payment of private debts in three annual instalments. Madison held that "no legislative principle could vindicate such an interposition of the law in private contracts," and the bill was lost, though but by one vote.* The taxes of the year were allowed to be paid in tobacco as "a commutable." These, and such like things," such was the unbending criticism of Washington, "are extremely hurtful, and may be reckoned among the principal sources of the evils and the corruption of the present day; and this, too, without accomplishing the object in view, for, if we mean to be honest, debts and taxes must be paid with the substance and not the shadow."+ Excusing the legislature, Madison answered: "The original object was paper money; petitions for graduated certificates succeeded; next came instalments, and lastly a project for making property a tender for debts at four fifths of its value; all these have been happily got rid of by very large majorities." + The mind of the country bent itself with all its energy to root out the evils of paper money, and establish among the states one common rule by which the obligation of contracts might be preserved unimpaired. No remedy would avail that did not reach them all. They found that for the scarcity of money there were but two remedies: frugality to diminish the need of it, and increased industry to produce more of it. They found that paper money drives specie away; that every new issue hastens its disappearance, destroying credit and creating a famine of money; that every penalty for the refusal to accept paper money at par lowers its worth, and that the heavier the penalty the more sure is the decline. They saw the deathblow that is given to credit, when confidence, which must be * Madison, i., 239, 252, 253, 255, 260, 265, 267. Washington to Madison. MS. Madison, i., 267, 268. voluntary, is commanded by force. They saw that the use of paper money robs industry, frugality, and honesty of their natural rights in behalf of spendthrifts and adventurers.* Grayson held that paper money with a tender annexed to it is in conflict with that degree of security to property which is fundamental in every state in the union. † He further thought that " congress should have the power of preventing states from cheating one another, as well as their own citizens, by means of paper money." + Madison classified the evils to be remedied under the four heads of depreciated paper as a legal tender, of property substituted for money in payment of debts, of laws for paying debts by instalments, and "of the occlusion of the courts of justice." To root out the dishonest system effectually, he held it necessary to give the general government not only the right to regulate coin as in the confederation, but to prevent interference with state, inter-state, and foreign contracts by separate legislation of any state. The evil was everywhere the subject of reprobation; the citizens of Massachusetts, as we learn from one of its historians,# complained of "retrospective laws;" Pelatiah Webster of Philadelphia set forth that "these acts alter the value of contracts," || and William Paterson of New Jersey, one of the best writers of that day on the subject, pointed out that "the legislature should leave the parties to the law under which they contracted." For resisting reform, Rhode Island and North Carolina were likely to be the foremost; for demanding it, and for persisting in the demand, Connecticut had the most hopeful record. Among the statesmen to whom the country might look in the emergency, no one had been more conspicuous or more efficient than Madison; but Roger Sherman had all the while been a member of the superior court of his own state, and so by near observation under great responsibility had thoroughly studied every aspect of the obligation of contracts. * Compare the writings and opinions of William Paterson, R. R. Livingston, R. II. Lee, Madison, and others, written or uttered in the years immediately preceding 1787. Grayson to Madison, 22 March 1786. # Minot's Insurrection, 15. Same to same, 28 May 1786. CHAPTER VII. CONGRESS CONFESSES ITS HELPLESSNESS. 1783-1786. "Ar length," so wrote Washington to Lafayette in 1783, "I am become a private citizen on the banks of the Potomac, solacing myself with tranquil enjoyments, retiring within myself, able to tread the paths of private life with heartfelt satisfaction, envious of none, determined to be pleased with all; and, this being the order for my march, I will move gently down the stream of life till I sleep with my fathers." The French minister, Luzerne, who visited Washington a few weeks after his return to private life, "found him attired in a plain gray suit like a Virginia farmer." "To secure the happiness of those around him appeared to be his chief occupation."* His country with one voice acknowledged that but for him its war of revolution must have failed. His glory pervaded the world, and the proofs of it followed him to his retirement. Houdon, the great French sculptor of his day, moved more by enthusiasm for him than by the expected compensation for making his statue, came over with his assistants to Mount Vernon to take a mould of his person, to study his countenance, to watch his step as he walked over his fields, his attitude as he paused; and so he has preserved for posterity the features and the form of Washington. Marie Antoinette added words of her own to those of the king of France, who invited him to visit them. Luzerne pressed the invitation as the heartfelt desire of the French * Luzerne to Rayneval, 12 April 1784. people. "Come to France," wrote Rochambeau, speaking the wish of all the French officers who had served in America; "come, and, in a country which honors you, be assured of a reception without example, after a revolution which has not its like in history." But his presence was needed at home to retrieve his affairs from the confusion consequent on his long service in the war, during which he not only refused all pay, but subscribed what he could to the public loans. Of these the amount of the principal had been reduced, and the interest, proportionately reduced, was paid in paper almost worthless. Moreover, persons indebted to him had seized their opportunity to pay him in depreciated continental bills. His estate, than which "no one in United America" seemed to him "more pleasantly situated," consisted of over nine thousand acres, for the most part of a grayish clay soil, lying on the south bank of the Potomac, and having, on the east and west, rivulets which rose and fell with the tides, and which, like the main stream, abounded in fish. He would gladly have found a tenant for two thirds of it at an annual rent of three thousand dollars; but was obliged to retain the management of the whole. His unpretending mansion, with rooms of low ceilings, and neither many nor large, was well placed on a high bank of the river. For beautifying the grounds around it, he would ride in the fine season into the forests and select great numbers of well-shaped trees and shrubs, elms and live-oaks, the pines and the hemlock, holly-trees and magnolias, the red-bud, the thorn, and many others, and would transplant them in the proper His orchard he filled with the best cherries and pears season. and apples. At the end of a year and a half he had not been able "to rescue his private concerns from the disorder into which they had been thrown by the war," though success in the effort "was become absolutely necessary for his support." * After he had been at home for two seasons, his inventory showed of horses one hundred and thirty, of cattle three hundred and thirty-six, of sheep two hundred and eighty-three; the hogs were untold, but on one winter's day a hundred and twentyWashington to Humphreys. Sparks, ix., 113. * |