council with power sufficient to give efficacy to their resolutions, can preserve us from being a conquered people now, or can make us a happy one hereafter." The committee of three, Randolph, Ellsworth, and Varnum, made their report on the twenty-second of August. They declined to prepare an exposition of the confederation, because such a comment would be voluminous if co-extensive with the subject; and, in the enumeration of powers, omissions would become an argument against their existence. With professional exactness they explained in twenty-one cases the "manner” in which "the confederation required execution.” As to delinquent states, they advised, "That-as America became a confederate republic to crush the present and future foes of her independence; as of this republic a general council is a necessary organ; and as, without the extension of its power, war may receive a fatal inclination and peace be exposed to daily convulsions-it be resolved to recommend to the several states to authorize the United States in congress assembled to lay embargoes and prescribe rules for impressing property in time of war; to appoint collectors of taxes required by congress; to admit new states with the consent of any dismembered state; to establish a consular system without reference to the states individually; to distrain the property of a state delinquent in its assigned proportion of men and money; and to vary the rules of suffrage in congress so as to decide. the most important questions by the agreement of two thirds of the United States."* It was further proposed to make a representation to the several states of the necessity for these supplemental powers, and of pursuing in their development one uniform plan. At the time when this report was made the country was rousing its energies for a final campaign. New England with its militia assisted to man the lines near New York; the commander-in-chief with his army had gone to meet Cornwallis in Virginia; and Greene was recovering the three southernmost states. Few persons in that moment of suspense cared to read the political essays of Hamilton, and he hastened to take part in the war under the command of Lafayette. The hurry of # Reports on increasing the powers of congress. crowded hours left no opportunity for deliberation on the reform of the constitution. Moreover, the committee of three, while they recognised the duty of obedience on the part of the states to the requisitions of congress, knew no way to force men into the ranks of the army, or distrain the property of a state. There could be no coercion; for every state was a delinquent. Had it been otherwise, the coercion of a state by force of arms is civil war, and, from the weakness of the confederacy and the strength of organization of each separate state, the attempt at coercion would have been disunion. Yet it was necessary for the public mind to pass through this process of reasoning. The conviction that the confederacy could propose no remedy for its weakness but the impracticable one of the coercion of sovereign states compelled the search for a really efficient and more humane form of government. Meantime the report of Randolph, Ellsworth, and Varnum, which was the result of the deliberations of nearly eight months, fell to the ground. We shall not have to wait long for a word from Washington; and, when he next speaks, he will propose "A NEW CONSTITUTION.' CHAPTER II. THE STRUGGLE FOR REVENUE. 1781-1782. SCHUYLER had been led by his own experience to perceive the necessity for the states to surrender some part of their sovereignty, and "adopt another system of government." On the twenty-first of January 1781 he moved in the senate of New York to request the eastern states to join in an early convention, which should form a perpetual league of incorporation, subservient, however, to the common interest of all the states; invite others to accede to it; erect Vermont into a state; devise a fund for the redemption of the common debts; substitute a permanent and uniform system for temporary expedients; and invest the confederacy with powers of coercion.* "We stand ready on our part to confer adequate powers on congress," was the message of both houses to that body in a letter of the fifth of February, written in the name of the state by their joint committee, on which were Schuyler and Benson. † Washington had been taught by his earliest observation as general, and had often declared the indispensable necessity of more responsibility and permanency in the executive bodies. + The convention at Boston of August 1780 had recommended * Schuyler to Washington, 21 January 1781. Letters to Washington, iii., 213. Letter from the state of New York to congress, 5 February 1781. Papers of Old Congress, lxvii., 344. MS. A copy of the letter was sent to Washington by Clinton, 14 February 1781. Letters to Washington, xlvi., 172. MS. Washington to Duane, 26 December 1780. "a permanent system for the several departments." * Hamil ton "was among the first who were convinced that their administration by single men was essential to the proper management of affairs."+ On the tenth of January 1781, congress initiated a reform by establishing a department of foreign affairs; but more than eight months elapsed before it was filled by Robert R. Livingston. There was the most pressing need of a minister of war. After tedious rivalries and delays, Benjamin Lincoln was elected; but he did not enter upon the office till near the end of November, when the attempt of Great Britain to subjugate America had ceased. For the treasury, John Sullivan suggested to Washington the name of Hamilton. # How far Hamilton had made a study of finance, Washington did not know; but he said: "Few of his age have a more general knowledge, and no one is more firmly engaged in the cause, or exceeds him in probity and sterling virtue." In February the choice fell on Robert Morris, and unanimously, except that Massachusetts abstained from the ballot, Samuel Adams preferring the old system of committees.◊ While Morris delayed his acceptance, Hamilton, who had been the first to present his name for the place, opened a correspondence with him. "A national debt," he wrote, "if it is not excessive, will be a national blessing, a powerful cement of union, a necessity for keeping up taxation, and a spur to industry." He recommended a national bank, with a capital of ten or fifteen millions of dollars, to be paid two sixths in specie, one sixth in bills or securities on good European funds, and three sixths in good landed security. It was to be erected into a legal corporation for thirty years, during which no * Hough's edition of Convention at Boston, 3–9 August 1780, 51. Hamilton to Robert Morris, 80 April 1781; Hamilton, i., 223; to Duane, 3 September 1780. Ibid., i., 154. Journals of Congress, iii., 564. * Sullivan to Washington, 29 January 1781. MS. | Washington to Sullivan, 4 February 1781. Sparks, vii., 399. A Journals of Congress, iii., 580. ◊ Luzerne to Vergennes, 25 March 1781. Partly printed in Sparks, vii., 400. Hamilton, i., 257. rate other bank, public or private, was to be permitted. Its capital and deposits were to be exempt from taxation, and the United States, collectively and particularly, and conjointly with the private proprietors, were to become responsible for all its transactions. Its sources of profit were to be the sole right of issuing a currency for the United States equal in amount to the whole capital of the bank; loans at not exceeding eight per cent; discount of bills of exchange; contracts with the French government for the supply of its fleets and armies in America, with the United States for the supply of their army; dealings in real estates, especially, with its large capital, buying at favorable opportunities the real estates of men who, having rendered themselves odious, would be obliged to leave the country. Another source of immense gain, contingently even of one hundred per cent, was to be a contract with the United States for taking up all their paper emissions. Incidentally, Hamilton expressed his "wish to see a convention of all the states, with full power to alter and amend, finally and irrevocably, the present futile and senseless confederation." "* This communication led to the closest relations between Hamilton and Robert Morris; but, vehement as was the character of the older man, his schemes fell far short of the daring. suggestions of his young counsellor. On the fourteenth of May, Morris was installed as the superintendent of finance, and three days later he laid before congress his plan for a national bank. Its capital was to be four hundred thousand dollars in gold and silver, with power of increase at discretion; its notes were to form the currency of the country, and be receivable as specie for duties and taxes by every state and by the United States. Authority to constitute the company a legal body not being granted by the articles of confederation, Morris submitted that congress should apply to the states for the power of incorporating a bank and prohibiting all other banks. + On the twenty-sixth, congress, without waiting to hear the * Hamilton, i., 223–257. +Journals of Congress, iii., 624; Diplomatic Correspondence, vii., 444-449. R. Morris to congress, 17 May 1781. Diplomatic Correspondence, xi., 364. |