The example of Virginia is more conspicuous, although not so early in time. The very term, “Treasury notes,” now used as the equivalent of “bills of credit,” first appears in her colonial legislation, when, in 1755, they were made a tender in payment of debts.[176] There were successive emissions in 1769, 1771, and 1773, which were not made a tender,—and then in 1778, and at other times afterwards, which were made a tender. That these “Treasury notes” were deemed “bills of credit” is demonstrated by the legislation of the State, especially by the Act of May, 1780, which, after reciting that the exigencies of the war require the further emission of paper money, authorizes new “Treasury notes,” and proceeds to punish with death any person who shall forge “any bill of credit or Treasury note to be issued by virtue of this Act.”[177]
I find that North Carolina, as early as 1748, sent forth bills of credit which were made a tender, and many subsequent emissions were authorized. South Carolina began in 1703; but these bills, bearing interest at twelve per cent, do not seem to have been made a tender. Others issued by this colony, at different times afterwards, were made a tender. In 1760 Georgia authorized bills of credit on interest, and secured by mortgage of the property of the receivers, which were made a tender.
The extensive employment of paper money in New England aroused the jealousy of the Imperial Parliament, which, by the Act of 25th June, 1751,[178] expressly forbade the issue of any “paper bills, or bills of credit,” except for certain specific purposes, or upon certain specified emergencies. The Act constantly speaks of these two as equivalent expressions, thus seeming to show that “bills of credit,” in their true meaning, were what is familiarly called “paper money,” with the incidents of such money. But the Act proceeds to limit these incidents by declaring expressly that “no paper currency, or bills of credit,” issued under it, shall be a tender in payment of any private debts or contracts whatsoever, with a proviso that nothing therein contained should make any bills then subsisting a tender. That Parliament should deem it necessary, by special enactment, to take from bills of credit the character of a tender, attests the customary association between these two ideas.
During the Revolutionary War, under the exigencies of that time, with a country without resources and a treasury without money, bills of credit, known as Continental money, were issued by Congress. But, while receivable in discharge of taxes and other public dues, they were not made a tender by Congress, although the States were recommended to make them such.
Mr. Collamer. And did make them so.
Mr. Sumner. At the adoption of the National Constitution, the people, to their wide-spread cost, had become familiar with bills of credit and their incidents, while all conversant with Colonial history must have known the part which bills of credit played for nearly a century, not only as a help to currency, but as a tender, constituting paper money. And yet, with all this ample knowledge,—present certainly to the framers of the Constitution, if not to the people,—no express words on this subject were introduced into the text of the Constitution, except with regard to the States. The conclusion from this silence, under all the circumstances, is strong, if not irresistible.
But the omission of the Constitution with regard to bills of credit was practically supplied by Congress, which has not hesitated to assume the existence of the power. If the Constitution failed to speak, Congress has not failed; and the exercise of this power cannot now be questioned, without unsettling our whole financial system. But we have seen that throughout our Colonial history the tender was a constant, though not inseparable, incident of the bill of credit,—that, indeed, it was so much part of the bill of credit that the Imperial Parliament positively interfered to separate the two, and, while sanctioning the bill of credit, forbade the tender. And now, if this historical review is properly apprehended, if it is not entirely out of place, it must conduct to the conclusion, that, whatever may be the present question of policy, the power to make Treasury notes a tender has precisely the same origin in the Constitution with the power to create Treasury notes. It is true that you may exercise one power and decline the other; but if you assume the power to issue bills of credit, I am at a loss to understand how you can deny the power to make them a tender. The two spring from the same fountain. You may refuse to exercise one or both; but you cannot insist upon one, under the Constitution, and reject the other.
Assuming the constitutionality of this proposition, or rather declining to admit the satisfactory force of the constitutional arguments against it, I am brought to a question which has, for me, more of difficulty and doubt: I mean the policy of exercising the power at this moment. It is not too much to say that this question concerns the national character, as well as the national welfare, while intelligent and patriotic men differ earnestly with regard to it. Decide it as we may, we cannot escape anxiety on the subject. Take which way we will, we cannot escape the just sense of responsibility. Seeking the truth only, and jealous of that good name which is to a Government one of its best possessions, I shall consider the question frankly; nor shall I disguise any of the difficulties which it presents, whether from principle or from experience. This is not the time for concealment, and I insist, that, if the power is exercised, its true character shall be understood. I invoke, also, the examples of history, to make us pause; but it will be my duty to show that there are other examples calculated to sustain the Government in the policy it now so urgently recommends.