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The debt was paid by paper notes from who shillings to ten pounds denomination, which notes were to be received for payment of the tax which was to be levied, and all other payments in the treasury. This was a new expedient. They had better credit than King James’ leather money in Ireland, about the same time. But the notes would not command money, nor any commodities at money price. Sir William Phipps, it is said, exchanged a large sum at par in order to gire them credit. The soldiers in general were great sufferers, and could get no more than twelve or fourteen shillings in the pound. As the time of payment of the tax approached, the credit of the notes was raised, and the Government allowing five per cent. to those who paid their taxes in notes, they became better than money. This was gain to the possessor, but it did not restore to the poor soldier what he had lost by the discount. “The Government, encouraged of the restoration of credit to their bills, afterwards issued others for charges of Government. They obtained good credit at the time of their being issued. The charges of Government were paid in this manner from year to year.

whilst the sum was small silver continued the measure, and bills continued their value. when the charges of Guvernment increased,after the second expedition to Canada in 1711, the bills likewise increased, and in the same or greater proportion, the silver and gold were sent out of the country. There being a cry of scarcity of money in 1714, the Government caused £50,000 to be issued, and in 1716, £100,000, and lent to the inhabitants, to be paid in at a certain period, and in the mean time to pass as money. Lands were mortgaged for security. As soon as the silver and gold were gone and the bills were the sale instrument of commerce, pounds, shillings, and pence were altogether ideal, for no possible reason could be assigned why a bill of twenty shillings should bear a certain proportion to anyone quantity of silver more than another. Sums in bills were drawing into the treasury from time to time, by the taxes or payment of the loans but then other sums were continually issuing out, and all the bills were paid and received without any distinction, either in public or private payments, so that, for near forty years together, the currency was in much the same state as if an hundred thousand pounds sterling had been stamped on pieces of leather, or paper of various denominations, any other sanction than this, that, when there should be taxes to pay, the treasury would receive this sort of money, and that every creditor should be obliged to receive it from his debtor. Can it be supposed that such a medium could retain its value 1 In 1702,6s. 8d. was equal to an ounce of silver. In 1749, 50s. was judged equal to an ounce of silver. I saw a five shilling bill which had been issued in 1690, and was remaining in 1749, and was then equal to eight pence only in the lawful money, and so retained but one-eighth of its original value. Such was the delusion, that not only the bills of the Massachusetts Government passed as money, but they received the bills of the Governments of Connecticut, New Hampshire, and Rhode Island also as a currency. The Massachusetts bills passed also in those Governments.* By the year 1713, “silver and gold were entirely banished. Of two instruments, one in use in a particular State only, the other with the whole commercial world, it is easy to determine which must leave the particular State and which remain.”The currency of silver and gold en· tiredly ceasing, the price of every thing bought or sold was no longer compared therewith, but with paper bills, or rather with mere ideal pounds, shillings, and pence. The rise of exchange with England and all other countries was not attributed to the true cause, the want of a fixed staple medium, but to the general bad state of the trade. Three parties were formed, one very small, which was for drawing in the paper bills and depending upon a silver and gold currency. Hutchinson, one of the members for Boston, was among the most active of this party. He was an enemy all his life, to a depreciating currency, upon a principle very ancient, but too seldom practiced upon, nil utile quod non hones-tum, [nothing which is not honest is useful.] “Another party was very numerous. These had projected a private Bank, or rather had taken up a project published in London in the year 1684: but this not being generally known in America, a merchant in Boston was the reputed father of it. There was nothing more in it if Hutchinson’ History of Massachusetts, vol 1, p. 402-3. London edition, 1765. that issuing bills of credit, which all the members of the company promised to receive as money, but at no certain value compared with silver and gold: and real estates, to a sufficient value, were to “be bound as a security that the company should perform their engagements. They were soliciting the sanction of the general court and an act of Government to incorporate them. This party, generally, consisted of persons in difficult or involved circumstances in trade, or such as were possessed of real estates, but had little or no ready money at command, or men of no substance at all: and we may well enough suppose the party to be very numerous. Some, no doubt, joined them from mistaken principles, and an apprehension that it was a scheme beneficial to the public, and some for party sake and popular applause. “A third party, though very opposite to the private Bank, yet were no enemies to bills of credit. They were in favor of a loan of bills from the Government to any of the inhabitants who would mortgage their estates as a security for the re·’payment of the bills, with interest, in a term of years, the interest to be paid annually, and applied to the support of Government. This was an easy way of paying public charges, which no doubt, they wondered that in so many ages the wisdom of other Governments had never discovered. “The controversy had a universal spread, and divided towns, parishes, and particular families. At length, after a long struggle, the party for the public Bank prevailed in the General Court for a loan of fifty thousand pounds in bills of credit, which were put in the hands of trustees, and lent for five years only, to any of the inhabitants at five per cent. interest, one-fifth part of the principal to be paid annually. ‘This lessened the number of the party for the private Bank, but it increased the zeal and raised’ a strong resentment in those that remained.”* Under this system the trade of the province declined, and in the year 1720, there was a general cry for want of money. “The bills of credit, which were the only money, were daily depreciating. The depreciation was grievous to all creditors, but particularly distressing to the clergy