CHAPTER originally granted by the governor of New Hampshire, III. rights of land of three hundred and forty acres had 1791. been reserved for the use of schools, and others for the British Society for the Propagation of the Gospel in foreign parts, which latter, by an act of the Legislature of 1794, were also appropriated to the use of schools. In the townships granted by the State of Vermont, one right had been reserved for town schools and another for county grammar schools. From the proceeds of these lands originated the Vermont school fund. The University of Vermont, established at Burlington in 1791, was endowed by private subscriptions to the amount of $33,333, nearly half of which was contributed by Ira Allen, a younger brother of Ethan Allen, and, like him, conspicuous in the affairs of the state, of which he has left an historical sketch not without value. The Legislature added a donation of land amounting to nearly fifty thousand acres. The settlement at Burlington, and generally along the lake shores, had only commenced since the peace. The use of a single Legislative Assembly, originally introduced by Pennsylvania and Georgia, had been already abandoned by those two states. Vermont persisted in it till 1836, when she too so far modified her Constitution as to adopt a senate of thirty members as a part of her Legislature, dispensing at the same time with the Executive Council. A provision contained in the first Constitution, by which each town, irrespective of its population, was to have one representative and no more, still remains in force. The news of the repulse of Harmer, and of the increasing danger from the Indians on the northwestern frontier, led to the addition to the standing military force of a second regiment of infantry of nine hundred and III. twelve men. By the same act the president was au- CHAPTER thorized to appoint, for such term as he might think proper, a major general and a brigadier general, and to 1791. call into service, instead of or in addition to the militia which he was already empowered to call out, a corps of two thousand six months levies, and a body of mounted volunteers. For the support of these troops the sum of $312,686 was appropriated, which sum the president was authorized to borrow, in case the revenue not otherwise appropriated should prove insufficient to furnish it. The whole of the appropriations for the year 1791 amounted to $1,205,371, including $100,000 for the expenses of Harmer's unfortunate expedition, $20,000 to obtain from the new emperor of Morocco a recognition of the treaty formerly made with his father, and $48,000 to put the new excise system in operation. To these expenses were to be added interest on the Continental debt, which now became payable, to the amount of about $2,700,000, exclusive of the interest on the assumed debt, not payable till the next year. The treasury, at the end of the year 1790, had contained a surplus of about $1,000,000; but as the whole of that surplus, under an act of the previous session, had gone into the hands of the commissioners for the reduction of the public debt, there remained for the current expenses of the year, about $4,000,000, no resource except the current income and temporary loans. This act for increasing the army closed the labors of the first Congress-a body, next to the Convention that framed the Constitution, by far the most illustrious and remarkable in our post-Revolutionary annals. On coming together two years before, the new Congress had found the expiring government of the Confederation without revenue, without credit, without authority, influ CHAPTER ence, or respect at home or abroad; the state governIII. ments suffering under severe pecuniary embarrassments; 1791. and a large portion of the individuals who composed the nation overwhelmed by private debts. Commerce and industry, without protection from foreign competition, and suffering under all the evils of a depreciated and uncertain currency, exposed, also, to serious embarrassments from local jealousies and rivalries, were but slowly and painfully recovering from the severe dislocations to which first the war of the Revolution and then the peace had subjected them. Even the practicability of carrying the new Constitution into effect, at least without making the remedy worse than the disease, was seriously doubted and stoutly denied by a powerful party, having many able men among its leaders, and, numerically considered, including, perhaps, a majority of the people of the United States. In two short years a competent revenue had been provided, the duties imposed to produce it operating also to give to American producers a preference in the home market, and to secure to American shipping a like preference in American ports. The public debt, not that of the Confederation only, but the great bulk of the state debts, had been funded and the interest provided for, the public credit being thus raised from the lowest degradation to a most respectable position. The very funding of this debt, and the consequent steady and increasing value thus conferred upon it, had given a new character to the currency, composed as it was, in a great measure, of public securities; while steps had been taken to improve it still further by the establishment of a national bank. A national judiciary had been organized, vested with powers to guard the sanctity of contracts against stop-laws, tender laws, and paper money. The practi III. cability and efficiency of the new system had been as CHAPTER fully established as the experience of only two years would admit, and the nation thereby raised to a respect- 1791 able position in its own eyes and in those of foreign countries. The Senate had unwisely imitated the reserve of the Continental Congress a reserve necessary in time of war, but contrary to the democratic spirit of American institutions in transacting their business with closed doors. But the House of Representatives, by opening their doors to reporters and the public, had admitted the people, notwithstanding all the alarm that had been expressed as to the monarchical and aristocratical tendencies of the new government, to a knowledge of national affairs such as they had never before enjoyed. By the newspaper reports, disseminated through the Union, the proceedings of the House became, in fact, better known to the people than the doings of their own state Legislatures. These reports were very brief, compared with what we have now, yet sufficient to give a pretty accurate idea of the course of business in the House. The funding of the public debt, however in particular instances it might have redounded to the enrichment of cunning and sordid speculators, or however deserving sufferers by former public insolvency might have been overlooked, yet in its general operation promoted, to a great, and, indeed, unexpected degree, the public prosperity. By furnishing a capital almost or quite as available as cash, of which enterprise knew how to take advantage, and by the new and powerful impulse thus given to industry, it went far toward relieving that private pecuniary embarrassment which had constituted one of the greatest evils of the times. The newly funded CHAPTER Stocks had all the advantages of the old paper money III. issues, without any of their dangers, and with the ad 1791. ditional advantage of having a value abroad as well as at home-the sale of stocks abroad, urged as one of the great objections to the funding system, being, in fact, one of its chief recommendations-the holders being thus enabled to convert these paper obligations into actual cash. The great secret of the beneficial operation of the funding system was the re-establishment of confidence; for commercial confidence, though political economists may have omitted to enumerate it among the elements of production, is just as much one of those elements as labor, land, or capital-a due infusion of it increasing in a most remarkable degree the productive activity of those other elements, and the want of it paralyzing their power to a corresponding extent. By the restoration of confidence in the nation, confidence in the states, and confidence in individuals, the funding system actually added to the labor, land, and capital of the country a much greater value than the amount of the debt thereby charged upon them. Commerce and industry, thus buoyed up, had taken a great start. Favorable seasons, the attention given of late to domestic manufactures, the natural reaction from a period of embarrassment and depression, concurred with the revival of confidence, and the new arrangements in favor of trade and industry, to produce a sudden influx of prosperity. The exports rose at once to twenty millions a year, and shipping was increased so rapidly as already to have solved the doubt whether America could supply vessels enough to transport her own productions. To the profitable trade recently opened with India and China had been added another lucrative traffic to the northwest coast of America, a region then almost unknown, now so familiar as California and Ore |