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act £337,378 15s. in interest-bearing notes had been emitted and that £337,249 19s. exchanged bills had been actually burned.

Up to that time there had been borrowed by the state on these interest-bearing notes, £606,400, of which £556,400 was still outstanding, £50,000 of which did not mature until May, 1782. Most of these notes were for ten pounds and upwards and all bore interest at six per cent. It is true that the first two loans were put out at five per cent., but by subsequent legislation the holders were given the benefit of the higher rate. Adding the £337,378, the amount of the notes given in exchange for the bills of public credit, there was outstanding in interest-bearing notes after this transaction, £893,778, which at the discount imputed to the notes in the scale of depreciation afterwards adopted made the silver value of the debt in October, 1777,' £325,010. This is based upon the assumption that the notes must practically have shared the degradation of the continental bills. The interest-bearing clause helped them somewhat, but with an allowance for accrued interest, their quotation must have been the

same.

From that date to May third, 1780, £1,847,850 were emitted of these notes. This does not include the notes issued January thirteenth, 1780,2 for the balance due the state's quota in the continental army, for which taxes, amounting to £8,000,000 collectible in 1781-2-3-4-5, were pledged as funds. The notes for this emission3 were drawn up in a special form with intent to make good to the officers and soldiers, the wages first promised them, regardless of the past depreciation of the currency or of any that might take place thereafter. To cover the question there was incorporated in the notes a clause through which the value was to be determined by taking for a

1 Acts and Resolves Prov. Mass. Bay, Vol. V., 2 Ibid., p. 1133. Ibid., p. 1287.

p. 1413.

measure the prices affixed in the Monopoly Act of 1777, to Indian corn, beef, sheep's wool and sole leather.

Methods were regulated for determining on this basis from time to time the relation of the currency to this standard. A clause in the form shows that when the notes were originally emitted, the current prices of the named articles were thirty-two and one-half times what they were when the Monoply Act was passed. If the £8,000,000 in funds represents the currency which was required to settle these balances, the actual amount involved in this transaction, on the basis of thirty-two and one-half for one, was £246,154. On the third of May, when the last emission of these currency notes was made, the state stood pledged to redeem £11,442,628, besides £28,000 in small change still in circulation, but at the ratio of forty for one, the recognized depreciation at that time, this represented only £286,740.

May fifth, 1780, an act was passed in pursuance of a recommendation of congress, the purpose of which was to retire the state's quota of continental bills and furnish a new currency in place thereof. The state had yielded to congress the entire field in which to circulate its emissions of paper money and had retired its own bills of public credit. The emissions of the continental congress, never fully trusted, had fallen with each resort to the printing press until they were now admittedly worth only forty for one in silver. Having no power to raise money by taxation, congress had emitted these bills and had from time to time called upon the several states to retire by taxation certain amounts assigned to each.

In 1775, Massachusetts was asked to care for $434,2441 in four equal annual payments commencing November, 1779. In 1777,2 the amount to be raised for congress during the year was $820,000. In 1779, the quota was

1 Financial History of the United States, Bolles, p. 40.

2 Acts and Resolves Prov. Mass. Bay, Vol. V., p. 850. Ibid., pp. 933, 1034.

fixed in January at $2,000,000, but in May,' congress called for an additional tax of $6,000,000, and in October 2 a monthly assessment of $2,300,000 to be remitted for nine months, was called for.

The first of the monthly assessments was to be paid in February. On the twenty-third of that month congress resolved to relinquish two-thirds of the quotas, but on the eighteenth of March voted to restore the full amount and to continue the assessments until April, 1781. In this resolve congress stated that the bills were depreciated thirty-nine fortieths of their face value and provided that silver or gold would be received in payment of the quotas on the basis of one for forty. The extraordinary monthly assessment of fifteen million dollars on all the states was for the purpose of retiring the discredited currency, the maximum limit of which had been fixed at $200,000,000. In place of continental bills it was proposed that the states should emit interest-bearing notes payable within six years, in silver, at five per cent. These were to be guaranteed by the United States and were to be secured by taxes pledged as annual funds for six years, each of one-sixth the total amount. For every twenty retired of the old, one of the new was to be issued, six-tenths for the use of the state, four-tenths for the United States.

The act of May fifth, 1780, referred to above, was for the purpose of carrying out the foregoing recommendations. A tax was granted amounting to £5,600,000, or $18,666,666, which with a previous tax of the same session, would, it was averred, provide for the state's quota of the currency to be retired. This tax could be paid in silver, gold, or the new bills. Continental bills would be received at the rate of forty for one. Four hundred and sixty thousand pounds were ordered to be emitted in bills of the character above described, for the redemption of which certain

1 Acts and Resolves Prov. Mass. Bay, Vol. V., p. 1079. 2 Ibid., pp. 1137, 1295. 3 Ibid., p. 1339.

future taxes, payable only in coin or certain produce, were ordered to be levied.

The tax for the retirement of the state's quota of the continental bills, amounting in round numbers to five million six hundred thousand pounds, was levied May fifth, 1780.1 Collectors were authorized to receive one dollar in specie or one dollar of the new bills on interest in lieu of forty dollars of the bills then in circulation. The next tax, which was levied June fifth, for current state expenditures, was made payable in gold or silver coin, in bullion, or in certain articles at specified prices. On the twenty-ninth of September, the Depreciation Act was passed. The preamble asserted that this was done in response to a recommendation of congress to the states, to revise the laws making continental bills a tender, and to amend them in the manner most conducive to justice, considering the present state of the paper currency. The scale ran from 105 currency for 100 in coin, January, 1777, to 4,000 currency for 100 in coin, April, 1780. As a matter of fact the resolve of congress in March, 1780, fixing the depreciation at that time at forty for one, had so completely undermined confidence in the bills that from that time on, no measure of their depreciation can be ascertained which can be regarded as accurate.

The last act published in the edition of the laws, known as the Acts and Resolves of the Province of Massachusetts Bay, is a tax levy, of date of September thirtieth, of the same amount, character and purpose as that of May fifth,

1 Acts and Resolves Prov. Mass. Bay, Vol. V., p. 1202. 2 Ibid., p. 1412. 3 House Document No. 107, 20th Congress, Washington, 1828, contains a letter from the Secretary of the Treasury, transmitting information relative to the amount of the Continental money and the depreciation of the same. The tables of depreciation for the several states, show wide differences. In Massachusetts the last date given is June, 1781, when the depreciation was given as 100 for 1. In New Jersey it was 150 for 1, in May, 1781. In Pennsylvania 225 for 1, in May, 1781. In Virginia 1000 for 1, in December, 1781. In North Carolina 725 for 1, in December, 1781.

* Acts and Resolves Prov. Mass. Bay, Vol. V., p. 1421.

1780. The final effort of the general assembly-statewas in support of the confederation.

There was one lottery, at least, created by the assembly which was connected with our subject. It was established by resolve and not by act, but we are put upon the track of it in the preambles to acts for the emission of notes to meet the prizes which had been awarded. The resolve of the general court establishing it was passed May first, 1778,1 and the purpose was to raise $750,000 for gratuities to officers and soldiers who had enlisted for three years in the continental army, before August fifteenth, 1777. In order to pay prizes of fifty dollars or upwards notes were emitted as follows: February eleventh, 1779, £21,450 for tickets of first class;' April fourteenth, £81,570 for tickets of the second and third classes; May third, 1780, £49,830 for tickets of the fourth class; in all £152,850, or $509,500. The total number of tickets in the four schemes amounted to $950,000 and the blanks were fifteen per cent. or $143,000.

6

Reference has been made to the passage of the Act to prevent Monopoly and Oppression. Such acts as this are not directly in the line of our inquiry, but their passage indicates a condition of financial affairs and a stage of economic opinion which justifies, perhaps compels, their mention. The failure to limit prices by means of the act referred to led to the passage, February eighth, 1779,7

Refer

1 Acts and Resolves Prov. Mass. Bay, Vol. V., p. 983. 2 Ibid., p. 929. 3 Ibid., p. 959. Ibid., p. 1193. Ibid., p. 1363 et seq. Ibid., p. 583. 7 Acts and Resolves Prov. Mass. Bay, Vol. V., p. 924; p. 1118; p. 1397. ence has been made to the Conferences of Commissioners from States at Providence and at Springfield. At the suggestion of Congress a conference of Commissioners from all the Northern States was held at New Haven in January, 1778. The Commissioners reported a scale of prices for labor, produce and manufactures which was adopted promptly by several states, but was still under consideration in Massachusetts, when in June, 1778, Congress recommended the states that had adopted it to repeal the laws passed for that purpose. The legislation against forestalling was brought about by a recommendation from Congress, and although it did not trespass upon the laws of trade in the same way as the Act against Monopoly and Oppression and the Report of the Commissioners, still it was incapable of general enforcement. See Acts and Resolves Prov. Mass. Bay, Vol. V., p. 1012.

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