398 INDEBTEDNESS OF THE UNITED STATES, OF THE STATES, ETC. 



The debt had now increased to $83,000,000. 

 In 1803 fifteen millions more were added to it 

 by the purchase from France of the province 

 of Louisiana. 



TKEASUEY NOTES. No special emergencies 

 arose or unusual measures were taken until 

 1812, when the second war with Great Britain 

 was declared by the Congress of the United 

 States. This closed in 1815, and increased the 

 debt to $127,300,000 ; a higher figure than it 

 had ever touched before, or afterward, until 

 1862. The only new measure adopted at this 

 time was the issue of Treasury notes. The bill to 

 authorize the issue was opposed in Congress on 

 the ground that " it was ingrafting on our sys- 

 tem of finances a new and untried measure." 

 The measure, however, was successful, and it 

 has since been one of the occasional aids of the 

 Treasury Department. The embarrassment of 

 the Government at the close of the war fur- 

 nished a basis for an irresistible argument in 

 favor of the recharter of the United States 

 Bank. No less a person than Mr. John 0. Cal- 

 houn, of South Carolina, introduced, from a 

 special committee of the House of Representa- 

 tives, the bill for its incorporation on January 

 8, 1816. The constitutional question relating 

 to it received little attention on its passage. 

 Thus, by means of revenue from imports, and 

 other domestic sources, temporary loans, Treas- 

 ury notes, and five, six, and seven per cent 

 loans, the financial affairs were honorably con- 

 ducted until 1821, when the Secretary of the 

 Treasury reported an expected deficit of over 

 four and a half millions to be provided for by 

 taxation. 



At this period the country was suffering from 

 the effects of a financial crisis in 1819. A com- 

 mittee from the House of Representatives, in 

 a report, thus described the general distress : 



It is not a matter of very great consolation to know 

 that, at the end of thirty years of its operation, this 

 Government finds its debt increased $20,000,000, and 

 its revenue inadequate to its expenditure ; the national 

 domain impaired, and $20,000,000 of its proceeds ex- 

 pended ; $35,000,000 drawn from the people by inter- 

 nal taxation, $341,000,000 by impost, yet the public 

 Treasury dependent on loans ; in profound peace, and 

 without national calamity, the country embarrassed 

 with debts, and real estate under rapid depreciation ; 

 the markets of agriculture, the pursuits of manufac- 

 tures diminished and declining ; commerce struggling, 

 not to retain the carrying of the produce of other na 

 tions, but our own. There is no national interest 

 which is in a healthful, thriving condition the nation 

 at large is not so ; the operations of the Government 

 and individuals alike laoor under difficulties which 

 are felt by all. . . . The sea, the forest, the earth yield 

 their abundance ; the labor of man is rewarded ; pes- 

 tilence, famine, or war commit no ravages ; no calam- 

 ity has visited the people ; peace smiles on us ; plenty 

 blesses the land. Whence, then, this burst of uni- 

 versal distress ? 



STATE DEPOSITS. An improvement soon 

 came; higher taxes followed, under which 

 South Carolina denied its constitutionality, 

 owing to the extreme protective form given to 

 it at that time. This supplied the Treasury, and 

 enabled the Government to dispense with the 

 aid of the United States Bank, the charter of 



which was allowed to expire about 1835. The 

 final result was that, in 1834, the Government 

 of the United States was, for the first time in 

 its history, practically out of debt, for the last 

 installment of the debt had been paid. Nay, so 

 abundant was the money in the Treasury that 

 the Government returned over $28,000,000 

 back to the people, under the form of a u de- 

 posit," made proportionally to the States. All 

 of the States accepted the unasked deposit at 

 the time, and generally appropriated it to edu- 

 cational purposes. The following statement 

 shows the amount of money thus u deposited " 

 with the several States under the act of June 

 23, 1836. The fund originally proposed to be 

 distributed among the States was $36,000,000, 

 and $28,101,644.91 was really distributed, in 

 three quarterly installments, the first in Febru- 

 ary, 1837, the second in April, and the third in 

 July. The fourth and last installment was not 

 paid. A series of disasters, ending in the panic 

 of 1837, so disordered the finances of the Gen- 

 eral Government that a new act of Congress 

 was passed, on October 2d, postponing the 

 transfer of the fourth installment until January 

 1, 1839. By a subsequent act it was postponed 

 indefinitely ; and it was further provided that 

 the amount deposited should remain with the 

 States until otherwise directed by Congress. 

 Here the matter has remained : 



Maine ...................................... $955,838 25 



New Hampshire ............................ 669,086 79 



Massachusetts .............................. 1,338,173 58 



Vermont ................................... 669,086 79 



Connecticut ................................ 764,670 60 



Ehode Island .............................. 382,33530 



New York .................................. 4,014,520 71 



New Jersey ................................ 764,670 60 



lvania ............................... 2,867,514 



78 

 286,751 49 



Pennsyl 



Delaware 



Maryland 



Virginia .................................... 2,198,427 99 



North Carolina .............................. 1,483,757 39 



South Carolina .............................. 1,051,422 09 



Georgia ... ................. 1,051,422 09 



Alabama .................................... 699.086 79 



Louisiana ............................. 477,91914 



Mississippi ................................. 882,835 30 



Tennessee .................................. 1,433,757 89 



Kentucky .................................. 1.438,757 39 



Ohio.... ................................... 2,007,26084 



Missouri .................................... 882,835 80 



Indiana ..................................... 860,254 44 



Illinois ..................................... 477,919 14 



Michigan ................................... 286,751 49 



Arkansas ................................... 286,751 49 



Total ................................ $28,101,644 91 



Now followed the memorable contest on the 

 question of sub-Treasuries, located in different 

 places, as depositories of the money of the 

 Government, a service which had been ren- 

 dered by the branches of the defunct United 

 States Bank. At the same time (1837) com- 

 menced a state of extraordinary financial de- 

 pression, which continued for some years. Is- 

 sues of Treasury notes and loans were resorted 

 to for relief; so that, in 1846, when war with 

 Mexico was declared, the public debt had 

 reached $15,500,000. It immediately mounted 

 up to $63,000,000 on the final closing up of 

 the expenditures. 



There were some incidental expenditures 

 which resulted from this conflict. A bill was 



