Were they equal in value to gold and silver, the whole medium would depreciate, specie as well as paper. But as they want every requisit of a paper currency, the whole depreciation falls upon the securities.
An alarming consequence of the State of our public debt remains to be considered. Want of confidence in the public, added to the vast quantity of paper, has sunk it to a third, sixth, or eighth part of its nominal value. Most of the creditors of the public have parted with their securities at a great discount, and are thus robbed of the monies which they earned by the sweat of the brow. Men of property have purchased them for a trifle, and in some States receive the interest in specie. In Massachusetts, this is the case with respect to some part of the State debt. When a man buys a note of twenty shillings value for five, and receives the interest, six per cent. in specie, he in fact receives twenty four per cent. on his money.
This is one source of the insurrection in Massachusetts. The people feel the injustice of paying such an interest to men who earned but a small part of it, and whose sole merit is, that they have more money than their fellow citizens who suffer the loss by depreciation. Those men in particular, who fought for our independence, or loaned their property to save the country, view with indignant resentment, that law which obliges them to pay twenty four per cent. interest on the securities, which they have sold for a fourth, or an eighth part of their honest demands.
This cannot justify the violent steps taken by the people; because petitions, and united firmness in a constitutional way, would have procured redress. But I state the facts to shew the effects of speculation, or rather, of the want of faith in public engagements.
Such are the consequences of a variable medium; neglect to industry; application to irregular commerce; relaxation of principles in social intercourse; distrust of individuals; loss of confidence in the public, and of respect for laws; innumerable acts of injustice between man and man, and between the State and the subject; popular uneasiness, murmurs and insurrections. And such effects will exist till their cause shall be removed. Not the creation of a Supreme Power over the United States, is an object of more importance, than the annihilation of every species of fluctuating currency.
That instability of law, to which republics are prone, is another source of corruption. Multiplication and changes of law have a great effect in weakening the force of government, by preventing or destroying habits. Law acquires force by a steady operation, and government acquires dignity and respect, in proportion to the uniformity of its proceedings. Necessity perhaps has made our federal and provincial governments frequently shift their measures, and the unforeseen or unavoidable variations of public securities, with the impossibility of commanding the resources of the continent, to fulfil engagements, all predict a continuation of the evil. But the whole wisdom of Legislatures should be exerted to devise a system of measures which may preclude the necessity of changes that tend to bring government into contempt.
A mild or lax execution of law may also have a bad effect in lessening the respect for its officers. In a monarchy, there is no reasoning with the executive; the will of the prince inspires terror. In our governments, the officers are often familiar, and will even delay justice as long as possible to assist the prisoner.
In some of the eastern States, the frequency and mildness of laws, have introduced very singular habits. The people of Connecticut respect the laws as much as any people; they would not be guilty of disobedience; they mean generally to pay their debts, but are not very anxious to be punctual. They suppose a creditor can wait for his money longer than the period when it is due, and think it hard if he will not.[38]
This mild execution of law, and a consequential habit of dilatoriness, which arise from the spirit of equality, are still prevalent amongst the body of the people. These gave rise to the late incorporation of several commercial towns, with large powers; an expedient which has answered the purpose of giving to commerce the advantage of energy and dispatch in the collection of debts. As most of the business is done in the cities, this effect will gradually extend itself, and form different habits.
The great misfortune of the multiplicity of laws and frequency of litigation, is, that they weaken a respect for the executiv authority, destroy the principle of honor, and transfer the disgrace, which ought to follow delinquency in payment, from a man's reputation, to the administration of justice. The lawyers and courts are impeached, when the whole blame ought to fall upon the debtor for his impunctuality. Honor, a substitute for honesty, has more influence upon men than law; for in the one case, a man's character is at stake, and in the other, his property. When a man's character suffers not, by a failure of engagements, and by a public prosecution, the collection of debts must be slow. But when a man's reputation is suspended on the punctual discharge of his contracts, he will spare no pains to do it; and this is or ought to be the case in all commercial countries.