TAXATION AND DEBT. G43 



£128,000. They passed freely from hand to hand, but in a short while 

 the war came on, a flood of paper money was issued, depreciation followed, 

 and this project turned out both unprofitable and vexatious. 



In the Revolutionary war, as in the wars in which Carolina had been 

 previously engaged, recourse was again had to the emission of paper bills 

 of credit. Between 1775 and 1779 no less than £7,817,553 was thrown 

 into circulation. For the space of one year and nine months the enthu- 

 siasm of a people struggling for liberty maintained, undiminished, the 

 value of this paper, but in April, 1777, a destructive depreciation set in, 

 and the circulation of these bills was wholly arrested by the fall of 

 Charleston, in 1780. Their total value at the dates when the several 

 issues were made, was estimated at £481,065. At the date of the extinc- 

 tion of this circulating medium, there was literally no currency in the 

 State, for about that time also the Continental pai3er, " like an aged man, 

 expiring by the decays of nature, without a sigh or a groan, fell gently 

 asleep in the hands of its last possessors." The Spanish and French 

 loans, wdiich w^ere of such vital assistance to the Federal government in 

 the prosecution of the war at this critical juncture, furnished little or no 

 relief to the people of Carolina. The war, however, was carried on with 

 the same vigor. There was no money. Plate, rings, keepsakes, old coin 

 and such like articles, were brought into use by those who had them. 

 Buying and selling for the most part ceased, those having the necessaries 

 of life divided them freely with the destitute. Simply to live, was the 

 aim of most, and this was done to the astonishment of many, who could 

 scarcely tell how it had been effected. 



When at length the war was over, the State liquidated its war debts 

 by giving to its creditors an acknowledgment of the sums due them in 

 the form of an indent. For five years the interest on these indents was 

 paid by issuing special indents, made receivable in taxes, which were an- 

 nually imposed for their redemption. And thus every year two to three 

 hundred thousand dollars was furnished, which obtained considerable 

 circulation. 



In 1785, the State again issued bills of credit to the amount of £100,000, 

 loaning them in small amounts on mortgages of land or deposit of plate, 

 at seven per cent, interest. Of this loan £58,067 was outstanding in 

 1802, yielding a revenue of $17,420 to the State. The merchants came 

 forward in a body and agreed to take these bills at par with gold and 

 silver. No second issue was made, and the depreciation of the bills was 

 inconsiderable. The South Carolina Bank received this paper medium 

 on deposit and made repayment in specie or in its own bills. 



In 1790, the United States, to consolidate the finances of the country 

 and to equalize the condition of the several States, assumed the debts of 



