"My country is the World. My Religion is to do Good."

Dissertations on Government; the Affairs
of the Bank; and Paper Money

Thomas Paine



I here present the public with a new performance. Some parts of it are more particularly adapted to the state of Pennsylvania, on the present state of its affairs: but there are others which are on a larger scale. The time bestowed on this work has not been long, the whole of it being written and printed during the short recess of the assembly.

As to parties, merely considered as such, I am attached to no particular one. There are such things as right and wrong in the world, and so far as these are parties against each other, the signature of Common Sense is properly employed.

Thomas Paine / Philadelphia / 18 February, 1786

Dissertations on government, etc.

Every government, let its form be what it may, contains within itself a principle common to all, which is, that of a sovereign power, or a power over which there is no control, and which controls all others: and as it is impossible to construct a form of government in which this power does not exist, so there must of necessity be a place, if it may be so called, for it to exist in.

In despotic monarchies this power is lodged in a single person, or sovereign. His will is law; which he declares, alters or revokes as he pleases, without being accountable to any power for so doing. Therefore, the only modes of redress, in countries so governed, are by petition or insurrection. And this is the reason we so frequently hear of insurrections in despotic governments; for as there are but two modes of redress, this is one of them.

Perhaps it may be said that as the united resistance of the people is able, by force, to control the will of the sovereign, that therefore, the controlling power lodges in them; but it must be understood that I am speaking of such powers only as are constituent parts of the government, not of those powers which are externally applied to resist and overturn it.

In republics, such as those established in America, the sovereign power, or the power over which there is no control, and which controls all others, remains where nature placed it - in the people; for the people in America are the fountain of power. It remains there as a matter of right, recognized in the constitutions of the country, and the exercise of it is constitutional and legal. This sovereignty is exercised in electing and deputing a certain number of persons to represent and act for the whole, and who, if they do not act right, may be displaced by the same power that placed them there, and others elected and deputed in their stead, and the wrong measures of former representatives corrected and brought right by this means. Therefore the republican form and principle leaves no room for insurrection, because it provides and establishes a rightful means in its stead.

In countries under a despotic form of government, the exercise of this power is an assumption of sovereignty; a wresting it from the person in whose hand their form of government has placed it, and the exercise of it is there styled rebellion. Therefore the despotic form of government knows no intermediate space between being slaves and being rebels.

I shall in this place offer an observation which, though not immediately connected with my subject, is very naturally deduced from it, which is that the nature, if I may so call it, of a government over any people, may be ascertained from the modes which the people pursue to obtain redress of grievances; for like causes will produce like effects. And therefore the government which Britain attempted to erect over America could be no other than a despotism, because it left to the Americans no other modes of redress than those which are left to people under despotic governments, petition and resistance: and the Americans, without ever attending to a comparison on the case, went into the same steps which such people go into, because no other could be pursued: and this similarity of effects leads up to, and ascertains the similarity of the causes or governments which produced them.

But to return. The repository where the sovereign power is placed is the first criterion of distinction between a country under a despotic form of government and a free country. In a country under a despotic government, the sovereign is the only free man in it. In a republic, the people, retaining the sovereignty themselves, naturally and necessarily retain their freedom with it: for wherever the sovereignty is, there must the freedom be.

As the repository where the sovereign power is lodged is the first criterion of distinction, so the second is the principles on which it is administered.

A despotic government knows no principle but will. - Whatever the sovereign wills to do, the government admits him the inherent right, and the uncontrolled power of doing. He is restrained by no fixed rule of right and wrong, for he makes the right and wrong himself, and as he pleases. If he happens (for a miracle may happen) to be a man of consummate wisdom, justice and moderation, of a mild affectionate disposition, disposed to business, and understanding and promoting the general good, all the beneficial purposes of government will be answered under his administration, and the people so governed, may, while this is the case, be prosperous and easy. But as there can be no security that this disposition will last, and this administration continue, and still less security that his successor shall have the same qualities and pursue the same measures; therefore no people exercising their reason, and understanding their rights, would, of their own choice, invest any one man with such a power.

Neither is it consistent to suppose the knowledge of any one man competent to the exercise of such a power. A sovereign of this sort, is brought up in such a distant line of life; lives so remote from the people, and from a knowledge of everything which relates to their local situations and interests, that he can know nothing from experience and observation, and all which he does know he must be told. Sovereign power without sovereign knowledge, that is, a full knowledge of all the matters over which that power is to be exercised, is a something which contradicts itself.

There is a species of sovereign power in a single person, which is very proper when applied to a commander-in-chief over an army, so far as relates to the military government of an army, and the condition and purpose of an army constitute the reason why it is so. In an army every man is of the same profession, that is, he is a soldier, and the commander-in-chief is a soldier too: therefore the knowledge necessary to the exercise of the power is within himself. By understanding what a soldier is, he comprehends the local situation, interest and duty of every man within what may be called the dominion of his command; and, therefore, the condition and circumstances of an army make a fitness for the exercise of the power.

The purpose, likewise, or object of an army, is another reason: for this power in a commander-in-chief, though exercised over the army, is not exercised against it; but is exercised through or over the army against the enemy. Therefore the enemy, and not the people, is the object it is directed to. Neither is it exercised over an army for the purpose of raising a revenue from it, but to promote its combined interest, condense its powers, and give it capacity for action.

But all these reasons cease when sovereign power is transferred from the commander of an army to the commander of a nation, and entirely loses its fitness when applied to govern subjects following occupations, as it governs soldiers following arms. A nation is quite another element, and every thing in it differs not only from each other, but all of them differ from those of an army. A nation is composed of distinct, unconnected individuals, following various trades, employments and pursuits: continually meeting, crossing, uniting, opposing and separating from each other, as accident, interest and circumstance shall direct. An army has but one occupation and but one interest.

Another very material matter in which an army and a nation differ, is that of temper. An army may be said to have but one temper; for however the natural temper of the persons composing the army may differ from each other, there is a second temper takes place of the first: a temper formed by discipline, mutuality of habits, union of objects and pursuits, and the style of military manners: but this can never be the case among all the individuals of a nation. Therefore the fitness, arising from those circumstances, which disposes an army to the command of a single person, and the fitness of a single person for that command, is not to be found either in one or the other, when we come to consider them as a sovereign and a nation.

Having already shown what a despotic government is, and how it is administered, I now come to show what the administration of a republic is.

The administration of a republic is supposed to be directed by certain fundamental principles of right and justice, from which there cannot, because there ought not to be any deviation; and whenever any deviation appears, there is a kind of stepping out of the republican principle, and an approach towards the despotic one. This administration is executed by a select number of persons, periodically chosen by the people, who act as representatives and in behalf of the whole, and who are supposed to enact the same laws, and pursue the same line of administration, as the people would do were they all assembled together.

The public good is to be their object. It is therefore necessary to understand what public good is.

Public good is not a term opposed to the good of individuals; on the contrary, it is the good of every individual collected. It is the good of all, because it is the good of every one: for as the public body is every individual collected, so the public good is the collected good of those individuals.

The foundation-principle of public good is justice, and wherever justice is impartially administered the public good is promoted; for as it is to the good of every man that no injustice be done to him, so likewise it is to his good that the principle which secures him should not be violated in the person of another, because such a violation weakens his security, and leaves to chance what ought to be to him a rock to stand on.

But in order to understand more minutely, how the public good is to be promoted, and the manner in which the representatives are to act to promote it, we must have recourse to the original or first principles, on which the people formed themselves into a republic.

When a people agree to form themselves into a republic (for the word republic means the public good, or the good of the whole, in contradistinction to the despotic form, which makes the good of the sovereign, or of one man, the only object of the government), when I say, they agree to do this, it is to be understood, that they mutually resolve and pledge themselves to each other, rich and poor alike, to support and maintain this rule of equal justice among them. They therefore renounce not only the despotic form, but the despotic principle, as well of governing as of being governed by mere will and power, and substitute in its place a government of justice.

By this mutual compact, the citizens of a republic put it out of their power, that is, they renounce, as detestable, the power of exercising, at any future time, any species of despotism over each other, or doing a thing not right in itself, because a majority of them may have strength of numbers sufficient to accomplish it.

In this pledge and compact*? lies the foundation of the republic: and the security to the rich and the consolation to the poor is, that what each man has is his own; that no despotic sovereign can take it from him, and that the common cementing principle which holds all the parts of a republic together, secures him likewise from the despotism of numbers: for despotism may be more effectually acted by many over a few, than by one man over all.

*Constitution, sect. 15th.- Author.

Therefore, in order to know how far the power of an assembly, or a house of representatives can act in administering the affairs of a republic, we must examine how far the power of the people extends under the original compact they have made with each other; for the power of the representatives is in many cases less, but never can be greater than that of the people represented; and whatever the people in their mutual original compact have renounced the power of doing towards, or acting over each other, the representatives cannot assume the power to do, because, as I have already said, the power of the representatives cannot be greater than that of the people they represent.

In this place it naturally presents itself that the people in their original compact of equal justice or first principles of a republic, renounced, as despotic, detestable and unjust, the assuming a right of breaking and violating their engagements, contracts and compacts with, or defrauding, imposing or tyrannizing over each other, and therefore the representatives cannot make an act to do it for them, and any such kind of act would be an attempt to depose not the personal sovereign, but the sovereign principle of the republic, and to introduce despotism in its stead.

It may in this place be proper to distinguish between that species of sovereignty which is claimed and exercised by despotic monarchs, and that sovereignty which the citizens of a republic inherit and retain. The sovereignty of a despotic monarch assumes the power of making wrong right, or right wrong, as he pleases or as it suits him. The sovereignty in a republic is exercised to keep right and wrong in their proper and distinct places, and never suffer the one to usurp the place of the other. A republic, properly understood, is a sovereignty of justice, in contradistinction to a sovereignty of will.

Our experience in republicanism is yet so slender, that it is much to be doubted, whether all our public laws and acts are consistent with, or can be justified on, the principles of a republican government.

We have been so much habited to act in committees at the commencement of the dispute, and during the interregnum of government, and in many cases since, and to adopt expedients warranted by necessity, and to permit to ourselves a discretionary use of power, suited to the spur and exigency of the moment, that a man transferred from a committee to a seat in the legislature, imperceptibly takes with him the ideas and habits he has been accustomed to, and continues to think like a committee-man instead of a legislator, and to govern by the spirit rather than by the rule of the constitution and the principles of the republic.

Having already stated that the power of the representatives can never exceed the power of the people whom they represent, I now proceed to examine more particularly, what the power of the representatives is.

It is, in the first place, the power of acting as legislators in making laws-and in the second place, the power of acting in certain cases, as agents or negotiators for the commonwealth, for such purposes as the circumstances of the commonwealth require.

A very strange confusion of ideas, dangerous to the credit, stability, and the good and honor of the commonwealth, has arisen, by confounding those two distinct powers and things together, and blending every act of the assembly, of whatever kind it may be, under one general name, of Laws of the Commonwealth, and thereby creating an opinion (which is truly of the despotic kind) that every succeeding assembly has an equal power over every transaction, as well as law, done by a former assembly.

All laws are acts, but all acts are not laws. Many of the acts of the assembly are acts of agency or negotiation, that is they are acts of contract and agreement, on the part of the state, with certain persons therein mentioned, and for certain purposes therein recited. An act of this kind, after it has passed the house, is of the nature of a deed or contract, signed, sealed and delivered; and subject to the same general laws and principles of justice as all other deeds and contracts are: for in a transaction of this kind, the state stands as an individual, and can be known in no other character in a court of justice.

By "laws," as distinct from the agency transactions, or matters of negotiation, are to be comprehended all those public acts of the assembly or commonwealth, which have a universal operation, or apply themselves to every individual of the commonwealth. Of this kind are the laws for the distribution and administration of justice, for the preservation of the peace, for the security of property, for raising the necessary revenue by just proportions, &c.

Acts of this kind are properly laws, and they may be altered, amended and repealed, or others substituted in their places, as experience shall direct, for the better effecting the purpose for which they were intended: and the right and power of the assembly to do this is derived from the right and power which the people, were they all assembled together, instead of being represented, would have to do the same thing: because, in acts or laws of this kind, there is no other party than the public. The law, or the alteration, or the repeal, is for themselves; - and whatever the effects may be, it falls on themselves; - if for the better, they have the benefit of it - if for the worse, they suffer the inconvenience. No violence to any one is here offered-no breach of faith is here committed. It is therefore one of those rights and powers which is within the sense, meaning and limits of the original compact of justice which they formed with each other as the foundation-principle of the republic, and being one of those rights and powers, it devolves on their representatives by delegation.

As it is not my intention (neither is it within the limits assigned to this work) to define every species of what may be called laws (but rather to distinguish that part in which the representatives act as agents or negotiators for the state from the legislative part,) I shall pass on to distinguish and describe those acts of the assembly which are acts of agency or negotiation, and to show that as they are different in their nature, construction and operation, from legislative acts, so likewise the power and authority of the assembly over them, after they are passed, is different.

It must occur to every person on the first reflection, that the affairs and circumstances of a commonwealth require other business to be done besides that of making laws, and, consequently, that the different kinds of business cannot all be classed under one name, or be subject to one and the same rule of treatment. -But to proceed -

By agency transactions, or matters of negotiation, done by the assembly, are to be comprehended all that kind of public business, which the assembly, as representatives of the republic, transact in its behalf, with a certain person or persons, or part or parts of the republic, for purposes mentioned in the act, and which the assembly confirm and ratify on the part of the commonwealth, by affixing to it the seal of the state.

An act of this kind, differs from a law of the before-mentioned kind; because here are two parties and there but one, and the parties are bound to perform different and distinct parts: whereas, in the before-mentioned law, every man's part was the same.

These acts, therefore, though numbered among the laws, are evidently distinct therefrom, and are not of the legislative kind. The former are laws for the government of the commonwealth; these are transactions of business, such as, selling and conveying an estate belonging to the public, or buying one; acts for borrowing money, and fixing with the lender the terms and modes of payment; acts of agreement and contract, with a certain person or persons, for certain purposes: and, in short, every act in which two parties, the state being one, are particularly mentioned or described, and in which the form and nature of a bargain or contract is comprehended. - These, if for custom and uniformity sake we call them by the name of laws, are not laws for the government of the commonwealth, but for the government of the contracting parties, as all deeds and contracts are; and are not, properly speaking, acts of the assembly, but joint acts, or acts of the assembly in behalf of the commonwealth on one part, and certain persons therein mentioned on the other part.

Acts of this kind are distinguishable into two classes: -

1st, Those wherein the matters inserted in the act have already been settled and adjusted between the state on one part, and the persons therein mentioned on the other part. In this case the act is the completion and ratification of the contract or matters therein recited. It is in fact a deed signed, sealed and delivered.

2d, Those acts wherein the matters have not been already agreed upon, and wherein the act only holds forth certain propositions and terms to be accepted of and acceded to.

I shall give an instance of each of those acts. First, the state wants the loan of a sum of money - certain persons make an offer to government to lend that sum, and send in their proposals: the government accept these proposals, and all the matters of the loan and the payment are agreed on; and an act is passed according to the usual form of passing acts, ratifying and confirming this agreement. This act is final.

In the second case, - the state, as in the preceding one, wants a loan of money - the assembly passes an act holding forth the terms on which it will borrow and pay: this act has no force until the propositions and terms are accepted of and acceded to by some person or persons, and when those terms are accepted of and complied with, the act is binding on the state. - But if at the meeting of the next assembly, or any other, the whole sum intended to be borrowed, should not be borrowed, that assembly may stop where they are, and discontinue proceeding with the loan, or make new propositions and terms for the remainder; but so far as the subscriptions have been filled up, and the terms complied with, it is, as in the first case, a signed deed: and in the same manner are all acts, let the matters in them be what they may, wherein, as I have before mentioned, the state on one part, and certain individuals on the other part, are parties in the act.

If the state should become a bankrupt, the creditors, as in all cases of bankruptcy, will be sufferers; they will have but a dividend for the whole: but this is not a dissolution of the contract, but an accommodation of it, arising from necessity. And so in all cases of this kind, if an inability takes place on either side, the contract cannot be performed, and some accommodation must be gone into, or the matter falls through of itself.

It may likewise, though it ought not to, happen that in performing the matters, agreeably to the terms of the act, inconveniences, unforeseen at the time of making the act, may arise to either or both parties: in this case, those inconveniences may be removed by the mutual consent and agreement of the parties, and each finds its benefit in so doing: for in a republic it is the harmony of its parts that constitutes their several and mutual good.

But the acts themselves are legally binding, as much as if they had been made between two private individuals. The greatness of one party cannot give it a superiority or advantage over the other. The state, or its representatives, the assembly, has no more power over an act of this kind, after it has passed, than if the state was a private person. It is the glory of a republic to have it so, because it secures the individual from becoming the prey of power, and prevents might from overcoming right.

If any difference or dispute arise afterwards between the state and the individuals with whom the agreement is made respecting the contract, or the meaning, or extent of any of the matters contained in the act, which may affect the property or interest of either, such difference or dispute must be judged of, and decided upon, by the laws of the land, in a court of justice and trial by jury; that is, by the laws of the land already in being at the time such act and contract was made. - No law made afterwards can apply to the case, either directly, or by construction or implication: for such a law would be a retrospective law, or a law made after the fact, and cannot even be produced in court as applying to the case before it for judgment.

That this is justice, that it is the true principle of republican government, no man will be so hardy as to deny.-If, therefore, a lawful contract or agreement, sealed and ratified, cannot be affected or altered by any act made afterwards, how much more inconsistent and irrational, despotic and unjust would it be, to think of making an act with the professed intention of breaking up a contract already signed and sealed.

That it is possible an assembly, in the heat and indiscretion of party, and meditating on power rather than on the principle by which all power in a republican government is governed, that of equal justice, may fall into the error of passing such an act, is admitted; - but it would be an actless act, an act that goes for nothing, an act which the courts of justice, and the established laws of the land, could know nothing of.

Because such an act would be an act of one party only, not only without, but against the consent of the other; and, therefore, cannot be produced to affect a contract made between the two. - That the violation of a contract should be set up as a justification to the violator, would be the same thing as to say, that a man by breaking his promise is freed from the obligation of it, or that by transgressing the laws, he exempts himself from the punishment of them.

Besides the constitutional and legal reasons why an assembly cannot, of its own act and authority, undo or make void a contract made between the state (by a former assembly) and certain individuals, may be added what may be called the natural reasons, or those reasons which the plain rules of common sense point out to every man. Among which are the following:

The principals, or real parties in the contract, are the state and the persons contracted with. The assembly is not a party, but an agent in behalf of the state, authorised and empowered to transact its affairs.

Therefore it is the state that is bound on one part and certain individuals on the other part, and the performance of the contract, according to the conditions of it, devolves on succeeding assemblies, not as principals, but as agents.

Therefore, for the next or any other assembly to undertake to dissolve the state from its obligation is an assumption of power of a novel and extraordinary kind. - It is the servant attempting to free his master.

The election of new assemblies following each other makes no difference in the nature of the thing. The state is still the same state. The public is still the same body. These do not annually expire though the time of an assembly does. These are not new-created every year, nor can they be displaced from their original standing; but are a perpetual, permanent body, always in being and still the same.

But if we adopt the vague, inconsistent idea that every new assembly has a full and complete authority over every act done by the state in a former assembly, and confound together laws, contracts, and every species of public business, it will lead us into a wilderness of endless confusion and insurmountable difficulties. It would be declaring an assembly despotic for the time being. - Instead of a government of established principles administered by established rules, the authority of government by being strained so high, would, by the same rule, be reduced proportionably as low, and would be no other than that of a committee of the state, acting with discretionary powers for one year. Every new election would be a new revolution, or it would suppose the public of the former year dead and a new public in its place.

Having now endeavoured to fix a precise idea to, and distinguish between legislative acts and acts of negotiation and agency, I shall proceed to apply this distinction to the case now in dispute, respecting the charter of the bank.

The charter of the bank, or what is the same thing, the act for incorporating it, is to all intents and purposes an act of negotiation and contract, entered into, and confirmed between the state on one part, and certain persons mentioned therein on the other part. The purpose for which the act was done on the part of the state is therein recited, viz. the support which the finances of the country would derive therefrom. The incorporating clause is the condition or obligation on the part of the state; and the obligation on the part of the bank, is "that nothing contained in that act shall be construed to authorise the said corporation to exercise any powers in this state repugnant to the laws or constitution thereof."

Here are all the marks and evidences of a contract. The parties - the purport - and the reciprocal obligations.

That this is a contract, or a joint act, is evident from its being in the power of either of the parties to have forbidden or prevented its being done. The state could not force the stockholders of the bank to be a corporation, and therefore as their consent was necessary to the making the act, their dissent would have prevented its being made; so on the other hand, as the bank could not force the state to incorporate them, the consent or dissent of the state would have had the same effect to do, or to prevent its being done; and as neither of the parties could make the act alone, for the same reason can neither of them dissolve it alone: but this is not the case with a law or act of legislation, and therefore the difference proves it to be an act of a different kind.

The bank may forfeit the charter by delinquency, but the delinquency must be proved and established by a legal process in a court of justice and trial by jury; for the state, or the assembly, is not to be a judge in its own case, but must come to the laws of the land for judgment; for that which is law for the individual, is likewise law for the state.

Before I enter further into this affair, I shall go back to the circumstances of the country, and the condition the government was in, for some time before, as well as at the time it entered into this engagement with the bank, and this act of incorporation was passed: for the government of this state, and I suppose the same of the rest, were then in want of two of the most essential matters which governments could be destitute of - money and credit.

In looking back to those times, and bringing forward some of the circumstances attending them, I feel myself entering on unpleasant and disagreeable ground; because some of the matters which the attacks on the bank now make it necessary to state, in order to bring the affair fully before the public, will not add honour to those who have promoted that measure and carried it through the late house of assembly; and for whom, though my own judgment and opinion on the case oblige me to differ from, I retain my esteem, and the social remembrance of times past. But, I trust, those gentlemen will do me the justice to recollect my exceeding earnestness with them, last spring, when the attack on the bank first broke out; for it clearly appeared to me one of those overheated measures, which, neither the country at large, nor their own constituents, would justify them in, when it came to be fully understood; for however high a party measure may be carried in an assembly, the people out of doors are all the while following their several occupations and employments, minding their farms and their business, and take their own time and leisure to judge of public measures; the consequence of which is, that they often judge in a cooler spirit than their representatives act in.

It may be easily recollected that the present bank was preceded by, and rose out of a former one, called the Pennsylvania bank which began a few months before; the occasion of which I shall briefly state.

In the spring of 1780, the Pennsylvania assembly was composed of many of the same members, and nearly all of the same connexion, which composed the late house that began the attack on the bank. I served as clerk of the assembly of 1780, which station I resigned at the end of the year, and accompanied a much lamented friend, the late colonel John Laurens, on an embassy to France.

The spring of 1780 was marked with an accumulation of misfortunes. The reliance placed on the defence of Charleston failed, and exceedingly lowered or depressed the spirits of the country. The measures of government, from the want of money, means and credit, dragged on like a heavy loaded carriage without wheels, and were nearly got to what a countryman would understand by a dead pull.

The assembly of that year met, by adjournment, at an unusual time, the 10th of May, and what particularly added to the affliction, was, that so many of the members, instead of spiriting up their constituents to the most nervous exertions, came to the assembly furnished with petitions to be exempt from paying taxes. How the public measures were to be carried on, the country defended, and the army recruited, clothed, fed, and paid, when the only resource, and that not half sufficient, that of taxes, should be relaxed to almost nothing, was a matter too gloomy to look at. A language very different from that of petitions ought at this time to have been the language of every one. A declaration to have stood forth with their lives and fortunes, and a reprobation of every thought of partial indulgence would have sounded much better than petitions.

While the assembly was sitting, a letter from the commander-in-chief was received by the executive council and transmitted to the house. The doors were shut, and it fell officially to me to read.

In this letter the naked truth of things was unfolded. Among other informations, the general said, that notwithstanding his confidence in the attachment of the army to the cause of the country, the distress of it, from the want of every necessary which men could be destitute of, had arisen to such a pitch, that the appearances of mutiny and discontent were so strongly marked on the countenance of the army, that he dreaded the event of every hour.

When the letter was read, I observed a despairing silence in the house. Nobody spoke for a considerable time. At length a member, of whose fortitude to withstand misfortunes I had a high opinion, rose: "If," said he, "the account in that letter is a true state of things, and we are in the situation there represented, it appears to me in vain to contend the matter any longer. We may as well give up at first as at last."

The gentleman who spoke next, was (to the best of my recollection) a member of Bucks county, who, in a cheerful note, endeavored to dissipate the gloom of the house -"Well, well," said he, "don't let the house despair, if things are not so well as we wish, we must endeavour to make them better." And on a motion for adjournment, the conversation went no further.

There was now no time to lose, and something absolutely necessary to be done, which was not within the immediate power of the house to do; for what with the depreciation of the currency, and slow operation of taxes, and the petitions to be exempted therefrom, the treasury was moneyless, and the government creditless.

If the assembly could not give the assistance which the necessity of the case immediately required, it was very proper the matter should be known by those who either could or would endeavor to do it. To conceal the information within the house, and not provide the relief which that information required, was making no use of the knowledge, and endangering the public cause. The only thing that now remained, and was capable of reaching the case, was private credit, and the voluntary aid of individuals; and under this impression, on my return from the house, I drew out the salary due to me as clerk, enclosed five hundred dollars to a gentleman in this city, in part of the whole, and wrote fully to him on the subject of our affairs.

The gentleman to whom this letter was addressed is Mr. Blair M'Clenaghan. I mentioned to him, that notwithstanding the current opinion that the enemy were beaten from before Charleston, there were too many reasons to believe the place was then taken and in the hands of the enemy: the consequence of which would be, that a great part of the British force would return, and join at New-York. That our own army required to be augmented, ten thousand men, to be able to stand against the combined force of the enemy. I informed Mr. M'Clenaghan of general Washington's letter, the extreme distresses he was surrounded with, and the absolute occasion there was for the citizens to exert themselves at this time, which there was no doubt they would do, if the necessity was made known to them; for that the ability of government was exhausted. I requested Mr. M'Clenaghan to propose a voluntary subscription among his friends, and added, that I had enclosed five hundred dollars as my mite thereto, and that I would increase it as far as the last ability would enable me to go.*

The next day Mr. M'Clenaghan informed me that he had communicated the contents of the letter at a meeting of gentlemen at the coffee-house, and that a subscription was immediately began; that Mr. Robert Morris and himself had subscribed two hundred pounds each, in hard money, and that the subscription was going on very successfully. This subscription was intended as a donation, and to be given in bounties to promote the recruiting service. It is dated June 8th, 1780. The original subscription list is now in my possession-it amounts to four hundred pounds hard money, and one hundred and one thousand three hundred and sixty pounds continental.

While this subscription was going forward, information of the loss of Charleston arrived,† and on a communication from several members of congress to certain gentlemen of this city, of the increasing distresses and dangers then taking place, a meeting was held of the subscribers, and such other gentlemen who chose to attend, at the city tavern. This meeting was on the 17th of June, nine days after the subscriptions had begun.

At this meeting it was resolved to open a security-subscription, to the amount of three hundred thousand pounds, Pennsylvania currency, in real money; the subscribers to execute bonds to the amount of their subscriptions, and to form a bank thereon for supplying the army. This being resolved on and carried into execution, the plan of the first subscriptions was discontinued, and this extended one established in its stead.

By means of this bank the army was supplied through the campaign, and being at the same time recruited, was enabled to maintain its ground; and on the appointment of Mr. Morris to be superintendent of the finances the spring following, he arranged the system of the present bank, styled the bank of North America, and many of the subscribers of the former bank transferred their subscriptions into this.

Towards the establishment of this bank, congress passed an ordinance of incorporation, December 21st, which the government of Pennsylvania recognized by sundry matters: and afterwards, on an application of the president and directors of the bank, through the mediation of the executive council, the assembly agreed to, and passed the state act of incorporation April 1st, 1782.

Thus arose the bank-produced by the distresses of the times and the enterprising spirit of patriotic individuals.-Those individuals furnished and risked the money, and the aid which the government contributed was that of incorporating them.-It would have been well if the State had made all its bargains and contracts with as much true policy as it made this: for a greater service for so small a consideration, that only of an act of incorporation, has not been obtained since the government existed.

Having now shown how the bank originated, I shall proceed with my remarks.

The sudden restoration of public and private credit, which took place on the establishment of the bank, is an event as extraordinary in itself as any domestic occurence during the progress of the revolution.

How far a spirit of envy might operate to produce the attack on the bank during the sitting of the late assembly, is best known and felt by those who began or promoted the attack. The bank had rendered services which the assembly of 1780 could not, and acquired an honour which many of its members might be unwilling to own, and wish to obscure.

But surely every government, acting on the principles of patriotism and public good, would cherish an institution capable of rendering such advantages to the community. The establishment of the bank in one of the most trying vicissitudes of the war, its zealous services in the public cause, its influence in restoring and supporting credit, and the punctuality with which all its business has been transacted, are matters, that so far from meriting the treatment it met with from the late assembly, are an honour to the state, and what the body of her citizens may be proud to own.

But the attack on the bank, as a chartered institution, under the protection of its violators, however criminal it may be as an error of government, or impolitic as a measure of party, is not to be charged on the constituents of those who made the attack. It appears from every circumstance that has come to light, to be a measure which that assembly contrived of itself. The members did not come charged with the affair from their constituents. There was no idea of such a thing when they were elected or when they met. The hasty and precipitate manner in which it was hurried through the house, and the refusal of the house to hear the directors of the bank in its defence, prior to the publication of the repealing bill for public consideration, operated to prevent their constituents comprehending the subject: therefore, whatever may be wrong in the proceedings lies not at the door of the public. The house took the affair on its own shoulders, and whatever blame there is, lies on them.

The matter must have been prejudged and predetermined by a majority of the members out of the house, before it was brought into it. The whole business appears to have been fixed at once, and all reasoning or debate on the case rendered useless.

Petitions from a very inconsiderable number of persons, suddenly procured, and so privately done, as to be a secret among the few that signed them, were presented to the house and read twice in one day, and referred to a committee of the house to inquire and report thereon. I here subjoin the petition? and the report, and shall exercise the right and privilege of a citizen in examining their merits, not for the purpose of opposition, but with a design of making an intricate affair more generally and better understood.

*If petitions are to be contrived to cover the design of a house of assembly, and give a pretence for its conduct, or if a house is to be led by the nose by the idle tale of any fifty or sixty signers to a petition, it is time for the public to look a little closer into the conduct of its representatives.- Author.

So far as my private judgment is capable of comprehending the subject, it appears to me, that the committee were unacquainted with, and have totally mistaken, the nature and business of a bank, as well as the matter committed to them, considered as a proceeding of government.

They were instructed by the house to inquire whether the bank established at Philadelphia was compatible with the public safety. It is scarcely possible to suppose the instructions meant no more than that they were to inquire of one another. It is certain they made no inquiry at the bank, to inform themselves of the situation of its affairs, how they were conducted, what aids it had rendered the public cause, or whether any; nor do the committee produce in their report a single fact or circumstance to show that they made any inquiry at all, or whether the rumours then circulated were true or false; but content themselves with modelling the insinuations of the petitions into a report and giving an opinion thereon. It would appear from the report, that the committee either conceived that the house had already determined how it would act without regard to the case, and that they were only a committee for form sake, and to give a colour of inquiry without making any, or that the case was referred to them, as law-questions are sometimes referred to law-officers for an opinion only.

This method of doing public business serves exceedingly to mislead a country. - When the constituents of an assembly hear that an inquiry into any matter is directed to be made, and a committee appointed for that purpose, they naturally conclude that the inquiry is made, and that the future proceedings of the house are in consequence of the matters, facts, and information obtained by means of that inquiry. -But here is a committee of inquiry making no inquiry at all, and giving an opinion on a case without inquiring into the merits of it. This proceeding of the committee would justify an opinion that it was not their wish to get, but to get over information, and lest the inquiry should not suit their wishes, omitted to make any. The subsequent conduct of the house, in resolving not to hear the directors of the bank, on their application for that purpose, prior to the publication of the bill for the consideration of the people, strongly corroborates this opinion: for why should not the house hear them, unless it was apprehensive that the bank, by such a public opportunity, would produce proofs of its services and usefulness, that would not suit the temper and views of its oppressors?

But if the house did not wish or choose to hear the defence of the bank, it was no reason that their constituents should not. The constitution of this state, in lieu of having two branches of legislature, has substituted, that, "to the end that laws before they are enacted may be more maturely considered, and the inconvenience of hasty determinations as much as possible prevented, all bills of a public nature shall be printed for the consideration of the people."? The people, therefore, according to the constitution, stand in the place of another house; or, more properly speaking, are a house in their own right. But in this instance, the assembly arrogates the whole power to itself, and places itself as a bar to stop the necessary information spreading among the people. The application of the bank to be heard before the bill was published for public consideration had two objects. First, to the house, - and secondly, through the house to the people, who are as another house. It was as a defence in the first instance, and as an appeal in the second. But the assembly absorbs the right of the people to judge; because, by refusing to hear the defence, they barred the appeal. Were there no other cause which the constituents of that assembly had for censuring its conduct, than the exceeding unfairness, partiality, and arbitrariness with which its business was transacted, it would be cause sufficient.

Let the constituents of assemblies differ, as they may, respecting certain peculiarities in the form of the constitution, they will all agree in supporting its principles, and in reprobating unfair proceedings and despotic measures.-Every constituent is a member of the republic, which is a station of more consequence to him than being a member of a party, and though they may differ from each other in their choice of persons to transact the public business, it is of equal importance to all parties that the business be done on right principles; otherwise our laws and acts, instead of being founded in justice, will be founded in party, and be laws and acts of retaliation; and instead of being a republic of free citizens, we shall be alternately tyrants and slaves. But to return to the report.

The report begins by stating that, "The committee to whom was referred the petitions concerning the bank established at Philadelphia, and who were instructed to inquire whether the said bank be compatible with the public safety, and that equality which ought ever to prevail between the individuals of a republic, beg leave to report" (not that they have made any inquiry, but) "that it is the opinion of this committee, that the said bank, as at present established, is, in every view, incompatible with the public safety." But why is it so? Here is an opinion unfounded and unwarranted. The committee have begun their report at the wrong end; for an opinion, when given as a matter of judgment, is an action of the mind which follows a fact, but here it is put in the room of one.

The report then says, "that in the present state of our trade, the said bank has a direct tendency to banish a great part of the specie from the country, and to collect into the hands of the stockholders of the bank, almost the whole of the money which remains among us."

Here is another mere assertion, just like the former, without a single fact or circumstance to show why it is made, or whereon it is founded. Now the very reverse of what the committee asserts is the natural consequence of a bank. Specie may be called the stock in trade of the bank, it is therefore its interest to prevent it from wandering out of the country, and to keep a constant standing supply to be ready for all domestic occasions and demands. Were it true that the bank has a direct tendency to banish the specie from the country, there would soon be an end to the bank; and, therefore, the committee have so far mistaken the matter, as to put their fears in the place of their wishes: for if it is to happen as the committee states, let the bank alone and it will cease of itself, and the repealing act need not have been passed.

It is the interest of the bank that people should keep their cash there, and all commercial countries find the exceeding great convenience of having a general depository for their cash. But so far from banishing it, there are no two classes of people in America who are so much interested in preserving hard money in the country as the bank and the merchant. Neither of them can carry on their business without it. Their opposition to the paper money of the late assembly was because it has a direct effect, as far as it is able, to banish the specie, and that without providing any means for bringing more in.

The committee must have been aware of this, and therefore chose to spread the first alarm, and, groundless as it was, to trust to the delusion.

As the keeping the specie in the country is the interest of the bank, so it has the best opportunities of preventing its being sent away, and the earliest knowledge of such a design. While the bank is the general depository of cash, no great sums can be obtained without getting it from thence, and as it is evidently prejudicial to its interest to advance money to be sent abroad, because in this case the money cannot by circulation return again, the bank, therefore, is interested in preventing what the committee would have it suspected of promoting.

It is to prevent the exportation of cash, and to retain it in the country, that the bank has, on several occasions, stopped the discounting notes till the danger had been passed.? The first part, therefore, of the assertion, that of banishing the specie, contains an apprehension as needless as it is groundless, and which, had the committee understood, or been the least informed of the nature of a bank, they could not have made. It is very probable that some of the opposers of the bank are those persons who have been disappointed in their attempts to obtain specie for this purpose, and now disguise their opposition under other pretences.

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