of the principal itself, and they have a right to it; but since it is not in our power to pay off the principal, the next expedient is to fund the debt and render the evidences of it negotiable.

“Beside the advantage to individuals from this arrangement, the active stock of the nation would be increased by the whole amount of the domestic debt, and of course the abilities of the community to contribute to the public wants; the national credit would revive, and stand hereafter on a secure basis.

"This was another object of the proposed duty.

"If it be conceded that a similar fund is necessary, it can hardly be disputed that the one recommended is the most eligible. It has been already shown that it affects all parts of the community in proportion to their consumption, and has therefore the best pretensions to equality. It is the most agreeable tax to the people that can be imposed, because it is paid insensibly, and seems to be voluntary.

"It may, perhaps, be imagined that it is unfavorable to commerce; but the contrary can easily be demonstrated. It has been seen that it does not diminish the profit of the merchant, and of course can be no diminution of his inducements to trade. It is too moderate in its amount to discourage the consumption of imported goods, and cannot, on that account, abridge the extent of importations. If it even had this effect, it would be an advantage to commerce by lessening the proportion of our imports to our exports, and inclining the balance in favor of this country.

"The principal thing to be consulted for the advancement of commerce, is to promote exports. All impediments to these, either by way of prohibiting, or by increasing the prices of native commodities, decreasing, by that means, their sale and consumption at foreign markets, are injurious. Duties on exports have this operation. For the same reason, taxes on possessions, and the articles of our own growth or manufacture, whether in the form of a land tax, excise, or any other, are more hurtful to trade than impost duties. The tendency of all such taxes is to increase the prices of those articles which are the objects of exportation, and to enable others to undersell us abroad. The farmer, if he pays a heavy land tax, must endeavor to get more for the products of his farm. The mechanic and laborer, if they find the necessaries of life grow dearer by an excise, must endeavor to exact higher wages; and these causes will produce an increase of prices within, and operate against foreign commerce.

"It is not, however, to be inferred that the whole revenue ought to be drawn from imports; all extremes are to be rejected. The chief thing to be attended to is, that the weight of the taxes fall not too heavily, in the first instance, upon particular parts of the community. A judicious distribution to all kinds of taxable property is a first principle in taxation. The tendency of these observations is only to show that taxes on possessions, on articles of our own growth and manufacture, are more prejudicial to trade than duties on imports.

"The observations which conclude the letter on which these remarks are made, naturally lead to reflections that deserve the serious attention of every member of the Union. There is a happy mean between too much confidence and excessive jealousy, in which the health and prosperity of a state consist. Either extreme is a dangerous vice: the first is a temptation to men in power to arrogate more than they have a right to the latter enervates government, prevents system in the administration defeats the most salutary measures, breeds confusion in the state, disgusts 14

VOL. I.

and discontents among the people, and may eventually prove as fatal to liberty as the opposite temper.

"It is certainly pernicious to leave any government in a situation of responsibility disproportioned to its power.

"The conduct of the war is intrusted to Congress, and the public expectation turned upon them, without any competent means at their command to satisfy the important trust. After the most full and solemn deliberation, under a collective view of all the public difficulties, they recommend a measure which appears to them the corner-stone of the pub lic safety they see this measure suspended for near two years; partiall complied with by some of the states; rejected by one of them, and in danger, on that account, to be frustrated; the public embarrassments ever; day increasing; the dissatisfaction of the army growing more serious, the other creditors of the public clamoring for justice; both irritated by the delay of measures for their present relief or future security; the hopes of our enemies encouraged to protract the war; the zeal of our friends depressed by an appearance of remissness and want of exertion on our part Congress harassed; the national character suffering, and the national safety at the mercy of events.

This state of things cannot but be extremely painful to Congress, and appears to your committee to make it their duty to be urgent to obviate the evils with which it is pregnant."

Resolved, That Congress agree to the said report.

POWERS OF CONGRESS TO REGULATE COMMERCE.

FRIDAY, April 30, 1784.- Congress took into consideration the report of a committee, consisting of Mr. Gerry, Mr. Reed, Mr. Williamson, Mr. Chase, and Mr. Jefferson, to whom were referred sundry letters and papers relative to commercial matters; and the following paragraph being under debate,

"That it be recommended to the legislatures of the several states to vest the United States in Congress assembled, for the term of fifteen years, with a power to prohibit any goods, wares, or merchandise, from being imported into any of the states, except in vessels belonging to, and navigated by, citizens of the United States, or the subjects of foreign powers with whom the United States may have treaties of commerce,"

A motion was made by Mr. Howell, seconded by Mr. Ellery, to postpone the consideration thereof, in order to take up the following:

"That it be recommended to the legislatures of the several states to restrain, by imposts or prohibitions, any goods, wares, or merchandise, from being imported into them respectively, except in vessels belonging to, and navigated by, citizens of the United States, or the subjects of foreign powers with whom the United States may have treaties of commerce, or the subjects of such foreign powers as may admit of a reciprocity in their trade with the citizens of these states. That it be recommended to the legislatures of the several states to prohibit the subjects of any foreign state, kingdom, or empire, from importing into them, respectively. any goods, wares, or merchandise, unless such as are the produce or manufacture of that state, kingdom, or empire, whose subjects they are."

And on the question to postpone, for the purpose above mentioned the yeas and nays being required by Mr. Ellery,

South Carolina,......... Mr. Reed,.

So it passed in the negative.

The report, being amended, was agreed to as follows:

"The trust reposed in Congress renders it their duty to be attentive to the conduct of foreign nations, and to prevent or restrain, as far as may be, all such proceedings as might prove injurious to the United States. The situation of commerce at this time claims the attention of the several states, and few objects of greater importance can present themselves to their notice. The fortune of every citizen is interested in the success thereof; for it is the constant source of wealth and incentive to industry; and the value of our produce and our land must ever rise or fall in proportion to the prosperous or adverse state of trade.

"Already has Great Britain adopted regulations destructive of our commerce with her West India Islands. There was reason to expect that measures so unequal, and so little calculated to promote mercantile intercourse, would not be persevered in by an enlightened nation. But these measures are growing into a system. It would be the duty of Congress, as it is their wish, to meet the attempts of Great Britain with similar restrictions on her commerce; but their powers on this head are not explicit, and the propositions made by the legislatures of the several states render it necessary to take the general sense of the Union on this subject.

"Unless the United States in Congress assembled shall be vested with powers competent to the protection of commerce, they can never command reciprocal advantages in trade; and without these, our foreign commerce must decline, and eventually be annihilated. Hence it is necessary that the states should be explicit, and fix on some effectual mode by which foreign commerce not founded on principles of equality may be restrained. "That the United States may be enabled to secure such terms, they have

"Resolved, That it be, and it hereby is, recommended to the legislatures of the several states, to vest the United States in Congress assembled. for the term of fifteen years, with power to prohibit any goods, wares, or merchandise, from being imported into, or exported from, any of the states, in vessels belonging to, or navigated by, the subjects of any power with whom these states shall not have formed treaties of commerce.

"Resolved, That it be, and it hereby is, recommended to the legislatures of the several states, to vest the United States in Congress assembled, for the term of fifteen years, with the power of prohibiting the subjects of any foreign state, kingdom, or empire, unless authorized by treaty, from importing into the United States any goods, wares, or merchandise, which are not the produce or manufacture of the dominions of the sovereign whose subjects they are.

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Provided, That to all acts of the United States in Congress assembled, in pursuance of the above powers, the assent of nine states shall be necessary."

REPORT OF THE STATES ON THE REGULATION OF COMMERCE, &c.

FRIDAY, March 3, 1786. - The committee, consisting of Mr. Kean, Mr. Gorham, Mr. Pinckney, Mr. Smith, and Mr. Grayson, to whom were recommended sundry papers and documents relative to commerce, and the acts passed by the states in consequence of the recommendations of Congress of the 30th of April, 1784, report,

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That, in examining the laws passed by the states, in consequence of the act of 30th April, 1784, they find that four states—namely, Massachusetts, New York, New Jersey, and Virginia-- have enacted laws conformable to the recommendations contained in the act, but have restrained their operation until the other states shall have substantially complied.

"That three states-namely, Connecticut, Pennsylvania, and Maryland -have passed laws conforming to the same, but have determined the time from which they are to commence; the first, from the time of passing their act in May, 1785; and the two latter, from the 30th of April, 1784.

"That New Hampshire, by an act passed the 23d of June, 1785, has granted full powers to regulate their trade, by restrictions or duties, for fifteen years, with a proviso that the law shall be suspended until the other states have substantially done the same.

"That Rhode Island, by acts passed in February and October, 1785, has granted power, for the term of twenty-five years, to regulate trade between the respective states, and of prohibiting, restraining, or regulating, the importation only of all foreign goods in any ships or vessels other than those owned by citizens of the United States, and navigated by a certain proportion of citizens, and also with a proviso restrictive of its operation until the other states shall have substantially complied.

"That North Carolina, by an act passed the 2d June, 1784, has granted powers similar to those granted by Rhode Island, relative to foreign commerce, but unrestrained in duration, and clogged with a clause, that, when all the states shall have substantially complied therewith, it shall become an article of confederation and perpetual union. "That they cannot find that the three other states-namely, Delaware, South Carolina, and Georgia - have passed any laws in consequence of the recommendations. The result is, that four states have fully complied; three others have also complied, but have determined the time of commencement, so that there will be a dissimilarity in the duration of the power granted; that three other states have passed laws in pursuance of the recommendations, but so inconsonant to them, both in letter and

spirit, that they cannot be deemed compliances; and that three other states have passed no acts whatever.

"That, although the powers to be vested by the recommendations, do not embrace every object which may be necessary in a well-formed system, yet, as many beneficial effects may be expected from them, the committee think it the duty of Congress again to call the attention of the states to this subject, the longer delay of which must be attended with very great evils; whereupon,

"Resolved, That the recommendations of the 30th April, 1784, be again presented to the view of the states of Delaware, South Carolina, and Georgia, and that they be most earnestly called upon to grant powers conformable thereto.

"Resolved, That the states of New Hampshire, Rhode Island, and North Carolina, be solicited to reconsider their acts, and to make them agreeable to the recommendations of the 30th April, 1784.

"Resolved, That the time for which the power under the recommendations of the 30th April, 1784, is to continue, ought to commence on the day that Congress shall begin to exercise it; and that it be recommended to the states of Pennsylvania, Connecticut, and Maryland, to amend their acts accordingly."

FRIDAY, September 29, 1786. The delegates for Georgia laid before Congress an act of that state, in pursuance of the recommendations of the 30th April, 1784, passed the 2d of August, 1786, vesting the United States in Congress assembled, for the term of fifteen years, commencing on the day Congress shall begin to exercise the powers, with a power to prohibit the importation or exportation of goods, wares, or merchandise, in ships belonging to, or navigated by, subjects of powers with whom the United States shall not have formed treaties of commerce, and to prohibit the subjects of foreign states, unless authorized by treaty, from importing goods, wares, or merchandise, which shall not be the produce or manufacture of the dominion of the sovereign whose subjects they are; provided, that nine states agree in the exercise of this power, and that it do not extend to prohibit the importation of negroes, and that the act shall not have force until the other twelve states have substantially complied with the recommendation above mentioned. MONDAY, October 23, 1786. The committee, consisting of Mr. Pinckney, Mr. Smith, and Mr. Henry, to whom was referred an act of the legislature of the state of Georgia, passed in consequence of the resolutions of the 30th of April, 1784, respecting commerce, and the subject of the said recommendation, having reported,

"That it appears, by the said resolutions, the United States in Congress assembled recommended to the legislatures of the several states to vest them, for the term of fifteen years, with powers to prohibit any goods, wares, or merchandise, from being imported into, or exported from, any of the states, in vessels belonging to, or navigated by, the subjects of any power with whom these states shall not have formed treaties of commerce; that they also recommended to the legislatures of the said states to vest the United States in Congress assembled, for the term of fifteen years, with the power of pohibiting the subjects of any foreign state, kingdom, or empire, unless authorized by treaty, from importing into the United States any goods, wares, or merchandise, which are not the produce or manufacture of the dominions of the sovereign whose subjects they are, :rovided, that to all acts of the United States in Congress assembled, in ursu