The writings of James Madison, comprising his public papers and his private correspondence, including numerous letters and documents now for the first time printed. |
| II. |
SPEECH IN THE VIRGINIA HOUSE OF DELEGATES, NOVEMBER,
1786, AGAINST PAPER MONEY.
|
 | The writings of James Madison, |  |
SPEECH IN THE VIRGINIA HOUSE OF DELEGATES, NOVEMBER,
1786, AGAINST PAPER MONEY.[84]
Unequal to Specie. 1. being redem̃mble at future day
and not bearing interest. 2. illustrated by
[obliterated] of Bank notes—Stock in funds—
Neckar on finance]. Navy bills—tallies. 3.
being of less use than specie which answers
externally as well as internally—must be of
value which depends on the use.
Unjust. 1. to creditors if a legal tender. 2 to
debtors if not legal tender, by increasing difficulty
of getting specie. This it does by increasing
extravagance & unfavourable balance of
trade—& by destroying that confidence between
man & man, by which resources of one
may be com̃anded by another. Illustrated
1 by raising denomination of coin 2. increasing
alloy of do. brass made as silver by the
Romans according to Sallust.[85]
3 by changing
weights & measures. 4. by case of creditors
within who are debtors without the State.
Unconstitutional 1. Affects rights of property as
much as taking away equal value in land;
illustrd. by case of land pd. for down & to be conveyd.
in future, & of a law permitting conveyance
to be satisfied by conveying a part only—
or other land of inferior quality—2. affects
property without trial by Jury
Congs. for two reasons. 1. for sake of uniformity.
2. to prevent fraud in States towards
each other or foreigners. Both these reasons
hold equally as to paper money.
Uñecessary. 1. produce of country will bring in
specie, if not laid out in superfluities. 2. Of
paper, if necessary, eno' already in Tobo. notes,
& public securities—3. the true mode of giving
value to these, and bringing in specie is to
enforce Justice & taxes.
Pernicious, 1. by fostering luxury, extends instead
of curing scarcity of specie—2. by disabling
compliance with requisition of Congs. 3. serving
dissentions between States. 4. destroyg.
confidence between individuals. 5. discouraging
com̃erce—6 enrichg. collectors & sharpers
—7. vitiating morals. 8. reversing end of
Govt. which is to reward best & punish worst.
9. conspiring with other States to disgrace
Republican Govts. in the eyes of mankind.
Objection. paper money good before the War.
Answr. 1. not true in N. Engd. nor in Va. where exchange
rose to 60 per ct. nor in Maryd. see
Franklyn on paper money 2. confidence then
not now. 3. principles of paper credit not
then understood. Such wd. not then nor now
succeed in Great Britain &c.
Notes on the back of a letter to Madison from Robt. Johnson, dated 23d
September, 1786:
| Unequal to specie. | Bank notes. Stock. |
| Objectn. | navy bills. tallies |
| Spanish paper Useless | |
| Unjust either to Credts. or debtrs | |
| 1. alloy | |
| 2. Weights & measures | |
| 3. brass made for silver by Romns. | |
| 4. Case of debtrs to other States | |
| Unconstitutional. | 1. property decd. by bill of Rights |
| Antifed1. | 2. trial by Jury |
| Unnecessary. | 1. produce will bring specie |
| 2. paper in Tobo. notes Warrts. &c. | |
| Hurtful | 1. by luxury increase, not cure the evil of scarcity of specie |
| 2. destroy confidence public & private | |
| 3. source of dissension between States see Confedn. as to regulation of coin |
|
| 4. enrich collectors, speculators &— | |
| 5. vitiate morals | |
| 6. reverse the end of Govt. by punishing good Citizens & rewarding bad. |
|
| 7. discourage foreign commerce &c. | |
| 8. dishonor our Repub [illegible] the eyes of mankind | |
| Examples of other States & during war | |
| Objectn. | paper good formerly |
| Answer. | 1. Not true in N. E. Va. Maryd. 12 to 20 Per Ct. |
| 2. Confidence then | |
| 3. principles of money not then understood Such wd not then nor now do in Europe |
|
| Advantages from rejectg. paper | |
| 1. Distinguish the State & its credit | |
| 2. draw com̃erce & specie | |
| 3. Not honorable [example] to other states. |
MAD. MSS.
Shortly after Cicero's first great speech against Catiline, Catiline's friend,
Caius Manlius, despatched deputies to the Roman general, Quintus Marcius
Rex, with instructions to say, among other things: "Often have your forefathers,
taking compassion on the Roman people, relieved their poverty by their
decrees; and very recently, within our memory, silver was paid with brass,
owing to the pressure of debt, with the approval of all good citizens."—Sallust's
Conspiracy of Catiline, ch. 33. The payments were in pursuance of a law proposed
by L. Valerius Flaccus, Consul, A. U. C. 667. Only the fourth part
was paid, an as for a sestertius, and a sestertius for a denarius.
| The writings of James Madison, | |