2043. DEBT (Revolutionary), Transfer of Domestic.—
If the transfer of the [domestic]
debts to Europe meet with any encouragement
from us, we can no more borrow money here, let our necessities be what they will. For
who will give ninety-six per cent. for the
foreign obligations of the same nation, whose
domestic ones can be bought at the same
market for fifty-five per cent.; the former, too,
bearing an interest of only five per cent., while
the latter yields six? If any discouragements
can be honestly thrown on this transfer, it
would seem advisable, in order to keep the
domestic debt at home. It would be a very
effectual one, if, instead of the title existing in
the Treasury books alone, it was made to exist
in loose papers, as our loan office debts do. The
European holder would then be obliged to risk
the title paper of his capital, as well as his interest,
in the hands of his agents in America,
whenever the interest was to be demanded;
whereas, at present, he trusts him with the interest
only. This single circumstance would
put a total stop to all future sales of domestic
debt at this market. [Amsterdam.]—
To the Treasury Board. Washington ed. ii, 368.
(A.
1788)
