be admitted by every candid man employed in the expedition who had tolerable means of information that one-fifth part of the men and of the money were sufficient to obtain every ostensible object of the expedition.' Whether, however, all or any of those expenses were necessary or not, it is certain that all of them might and should have been defrayed by raising a revenue coequal to the expense. It sometimes happens that, notwithstanding the care of the Legislature, a revenue will prove deficient, will yield less than had been expected this, upon an average, has not been the case of the United States. Although all the internal duties have always fallen short of the sums expected from them, those upon imports have uniformly yielded considerably more than the estimate. But in many instances, although the object of expense was immediate, the revenue did not begin till some months after, and the intermediate expense must be supplied by an anticipation of the revenue. The first and most undeniable evil which arises from anticipations is the additional expense caused by the interest to be paid for them. The total amount of interest paid for domestic loans for the year 1795, exclusively of that incurred for the subscription to the bank stock, was near 150,000 dollars; and to this must be added the premiums which must at times be paid in order to obtain the loans. Thus, eight hundred thousand dollars in six per cent. stock were borrowed in 1795, at par and as cash, from the Bank of the United States, for the purpose of completing the treaty with Algiers, which, it seems, have produced only 720,000 dollars in specie. If it be allowed, and there is no reason to doubt it, that no better mode of obtaining the money could be adopted, nothing can prove in a stronger manner the necessity of raising a revenue instead of recurring to loans. To give ten per cent. premium, and six per cent. interest on the nominal sum borrowed, in times of peace and unexampled prosperity, is equally ruinous and absurd. 1 In support of the opinion, a comparison might be drawn between the extent and real views of Shays' insurrection and those of the western one; and between the means employed and the moneys actually expended in suppressing each. It has been supposed by some that this was the only consequence of anticipating; and it has been urged that, provided a revenue originated at the same time with an object of expense, although that revenue did not become immediately productive (on account, as an instance, of the credits given to importers), yet, as a debt was contracted to government by those importers from the moment of importation, it might be set off against the anticipation made by government. Thus, although it be allowed that the receipts arising from revenues had fallen short of the expenses at the end of the year 1795 by a sum of three millions of dollars, and had caused an anticipation, a debt to an equal amount; yet it is insisted that the nominal revenue to the same date had exceeded the expenditure; that the bonds due by the merchants for the imposts, and which (after the deductions to which they were liable for drawbacks) may be estimated at four or five millions of dollars, were more than sufficient to counterbalance that anticipation. Supposing that those bonds were to be considered as a credit in favor of the public, and to be contrasted with the increase of debt, it still would be fallacious to contrast them with the expenditures. Whatever the nominal revenue may be, by whatever name it be called, it is not less evident that the expenses of one year can be defrayed only out of the actual receipts of the same year. Thus that part of the nominal revenue of 1795 which is not paid in the Treasury during that year, which consists of bonds payable in 1796, constitutes, in fact, the actual revenue, not of 1795, but of 1796. It cannot be applied to pay any part of the expenses of 1795; it cannot be applied to repay the anticipations made in 1795; it is barely sufficient to defray the current expenses of 1796; it is the revenue of 1796. Whenever a permanent expense is incurred, beginning with the first of January of one year, if the revenue appropriated to discharge the same does not become productive, does not bring money to the Treasury till the following year, a debt equal to the expense of that object for one year must be incurred; and it never can be discharged out of that revenue till after the expense itself has ceased. Thus, if an individual, in the year 1795, increases his revenue by an annuity of one hundred pounds, but payable only from the year 1796, and chooses at the same time to increase his expense to the same amount from the beginning of 1795, he must necessarily incur a debt of one hundred pounds, which debt, as long as he continues the same expense, never can be paid out of the annuity. Should a self-evident truth have required additional proof, this received one during the last session of Congress. Anticipations had been obtained from the Bank of the United States to the amount of 3,800,000 dollars. The bank-and this may serve as a lesson to the friends of anticipations-requested that the whole should be paid to them during the year 1796. The money was due; they had a right to ask for it; they stood in need of it. Although the demand of the whole amount at once was unexpected, and was made at a time when it was well known that government could neither borrow the money in Europe nor raise it at once by taxes, yet it was necessary to pay it or to proclaim our inability. An assignment on that nominal revenue of 1795, which is represented as a debt due to government, would not do. That revenue, receivable in 1796, must pay the expenses of that year. The Legislature, in order not to be guilty of a breach of faith, in order to discharge the anticipations, were obliged not only to create a six per cent. stock irredeemable for twenty-four years, but to direct that one-half of that stock, and the whole of the shares held by the United States in the bank, should be sold at whatever price could be obtained. Again; the idea that the bonds due by the importers are a credit in favor of the public, to be set off against any debt that may have been incurred by government, will, upon investigation, prove to be groundless. The debts due by the United States are due by the people of the United States, and can be discharged only out of the purse of the people of the United States. To whom are the bonds given by importers due? To the United States, to the people of the United States. True, and thence it is inferred that they should be deducted from the debt due by them. But by whom are those bonds due? By the importers? No; they are due by the consumers, by the people of the United States; and until those consumers, until the people of the United States shall have discharged them, shall actually have paid the amount of the duty to the importer and enabled him to pay the amount of his bond in the Treasury; until, in a word, the moneys are paid either to the collectors or to the Treasury, no part of the debt due by the people of the United States can be considered as discharged. The account stands thus: The people of the United States Dr. 1st. The amount of the debt of the Union, say Cr. By the bonds due to government, dollars 5,000,000 The only credit to be given is that part of the duties which, although not yet in the Treasury, has actually been paid by the people to the collectors. This sum cannot be taken under consideration when speaking merely of receipts and expenditures, but shall be credited when a calculation is made of the debts of the United States. From these considerations, it follows that the duties accrued but not yet due to government are only a nominal account, ascertaining the amount and securing the payment of the moneys which shall actually be paid hereafter by the people; that any expense incurred in one year beyond the actual receipts of that year must necessarily be supplied by loans, and that the increase of debt thereby caused is not less real whether those loans are obtained for a longer or shorter period, whether they go by the name of funded debt or of anticipations. To conclude in the words of a justly celebrated writer, "In Great Britain the annual land and malt taxes are regularly anticipated every year. The Bank of England generally advances, at an interest which since the revolution has varied from eight to three per cent., the sums for which those taxes are granted. . . . The only consider able branch of the public revenue which yet remains unmortgaged is thus regularly spent before it comes in. Like an improvident spendthrift, whose pressing occasions will not allow him to wait for the regular payment of his revenue, the state is in the constant practice of borrowing of its own factors and agents, and of paying interest for the use of its own money." Smith's Wealth of Nations, Book v. Chap. 3d. OF APPROPRIATIONS. It is declared by the Constitution of the United States that "no money shall be drawn from the Treasury but in consequence of appropriations made by law." Two things constitute the appropriation: 1st, the sum of money fixed for a certain expenditure; 2d, the fund out of which the money is to be paid. The executive officers can neither change the appropriation by applying money to an expense (although the object of that expense should have been authorized by law) for which no appropriation has been made, nor spend upon an authorized object of expense more than the sum appropriated, nor even that sum, unless the fund out of which it is payable is productive to that amount. Funds are classed and distinguished in relation either to receipts or to expenditures. The general receipts of the United States have been divided into two classes: the moneys obtained upon loan in Holland, commonly denominated the foreign fund, and the moneys obtained in America, whether arising from taxes or loans, designated by the name of domestic fund. The statements No. XII. and XIII. are an abstract of the yearly receipts and disbursements already contained in the statement No. X., but distinguishing them, under each of those two funds, from the establishment of the present government to the 1st of January, 1796. The foreign fund was exclusively appropriated to pay, 1st, the interest due on the foreign debt before the year 1791; 2d, the instalment of the principal of the foreign debt and of the loan contracted in order to pay for the bank stock of the United |