lator had an immense advantage over the buyer. Says the most brilliant apologist for French Revolutionary statesmanship, 'Commerce was dead; betting took its place.'

In the early part of 1792 the assignat was 30 per cent below par. In the following year it had fallen to 67 per cent below par. A basis for further issues was secured by the confiscation of lands of emigrant nobles, and a flood of assignats poured forth upon the country in steadily increasing volume. Before the close of 1794 seven thousand millions had been issued, and the year 1796 opened with a total issue of forty-five thousand millions, of which thirty-six thousand millions were in actual circulation. By February of that year the total issue had advanced to 45,500,000,000, and the value had dropped to one two-hundred-and-sixty-fifth part of their nominal value. A note professing to be worth about $20 of our money was worth about six cents.

The Government now came forward with a new scheme, offering to redeem the assignats, on the basis of 30 to 1, for mandats, a new form of paper money, which entitled the holder to take immediate possession, at their estimated value, of any of the lands pledged by the assignats. Eight hundred millions in mandats were issued, to be exchanged for the assignats, and the plates for printing the latter were destroyed. Six hundred millions more of mandats were issued for the public service. At first the mandats circulated at as high as 80 per cent of their nominal value, but additional issues sent them down in value even more rapidly than the assignats had fallen, and in a very short time they were worth only one-thousandth part of their nominal value. It was evident that the end had come. Before the assignats were withdrawn, the Government resorted to various expedients to hold up their value by legislative decrees. The use of coin was prohibited; a maximum price in assignats was fixed for commodities by law; the purchase of specie was forbidden under penalty of imprisonment in irons for six years; and the sale of assignats below their nominal value was forbidden under penalty of imprisonment for twenty years in chains. Investment of capital in foreign countries was punishable with death. All these efforts were as futile as similar efforts had been in John Law's time. The value of the assignats went steadily down. Bread riots broke out in Paris, and the Government was compelled to supply the capital with provisions. When the mandats fell, as the assignats had fallen before

them, the Government was convinced that it was useless to try to give value to valueless paper by simply printing more paper and calling it by another name; and on July 1, 1796, it swept away the whole mass by issuing a decree authorizing everybody to transact business in any money he chose. "No sooner," says Mr. McLeod, in his Economical Philosophy, "was this great blow struck at the paper currency, of making it pass at its current value, than specie immediately reappeared in circulation." In commenting upon this second experience of France with paper money, which lasted for about six years, Professor A. L. Perry, in his Elements of Political Economy, thus graphically and truthfully sums up the consequences: "The distress and consternation into which a country falls when its current measure of services is disturbed and destroyed, as it was in this case, is past all powers of description. The prisons and the guillotine did not compare with the assignats in causing suffering during those six years. This example is significant because it shows the powerlessness of even the strongest and most unscrupulous governments to regulate the value of anything. The assignats were depreciating during the very months in which Robespierre and the Committee of Public Safety were wielding the power of life and death in France with terrific energy. They did their utmost to stop the sinking of the Revolutionary paper. But value knows its own laws, and follows them in spite of decrees and penalties."

91. SOUTH CAROLINA'S FIRST PAPER MONEY'

ANONYMOUS

The first paper money issued in the Province of South Carolina was by virtue of an Act of the General Assembly, May 8, 1703, entitled "An Act for Raising the Sume of four thousand pounds, on the real and personal estates, and of and from the profits and revenues, of the inhabitants of this Province, and establishing bills of credit, for satisfying the debts due by the public on account of the late expedition of St. Augustine."

By this Act £6,000 in bills of credit were stamped and issued, bearing an interest of 12 per cent per annum from the date of the bill to the time the same was paid to the public receiver; and the said bills were to be sunk and cancelled by the tax raised by this Act;

'Adapted from Sound Currency, V (1898), No. 4, pp. 34-44. Evidently written in 1739 by some unknown person.

£2,000 to be raised and paid on February 1, 1703; £2,000 on February 1, 1704; and the remainder by means of duties arising by an Act made on May 6, 1703, entitled "an Act for laying an imposition on furrs, skins, liquors, and other goods and merchandize, imported into and exported out of this Province."

By an Act of December 20, 1703, the public receiver is directed to cancel £3,000 of the former bills when the tax assessments shall be raised; and £1,000 in bills at 12 per cent is continued current, any limitation in the former Act notwithstanding.

And by an Act, passed November 4, 1704, reciting "that a great part of the money and bills appropriated by the before recited Acts for particular uses, viz., calling in and sinking the bills of credit, had, for the immediate service and necessary defence of the Province, been, by order of the General Assembly, made use of for other purposes than they were appointed for and appropriated to by the said Acts," it was enacted that such payments should be deemed legal, and the receiver was indemnified and acquitted, as fully as if he had duly applied the same to the uses appointed by the Acts first recited.

On the same day, November 4, 1704, another Act was passed for raising the sum of £4,000 on the real and personal estates, and of and from the profits and revenues of the inhabitants of the Province, to pay and cancel the bills of credit now outstanding. This Act recites "that the urgent necessity for fortifying Charles Town, and other occasions for the defence of the Province against the common enemy, had exhausted the public treasury, and prevented the calling in and sinking the bills of credit. Therefore it was enacted that the bills should continue current, and a tender in law, with the interest of 12 per cent until March 10, 1705; and a tax of £4,000 was imposed, payable on the March 9, 1705, and appropriated for calling in the bills of credit which were then outstanding. A penalty was laid on the public treasurer, that if he misapplied any of the sums so appropriated, he should forfeit treble the value of the sum misapplied, and should be rendered incapable of holding any office in the government.

But after the passing of this Act, another Act was made, on April 9, 1706, entitled "an Act for the sooner and more secure payment of the debts owing by the public, and for the continuing the currency of the bills of credit, commonly called country bills." By this Act, all taxes laid by any former Acts of Assembly, and the duties imposed by the Act passed May 6, 1703, were continued and made current, and three-fourths of the duties before mentioned (after the payment

of the public debts and the clergy's salaries) were appropriated toward the sinking and discharging the bills of credit, and the remaining fourth part of the said duties were to be disposed of by order of the General Assembly, for the contingencies of the government.

The next Act, July 5, 1707, provides for an additional emission of paper currency, "for satisfying the debts due by the public on account of the late invasion; for finishing the fortifications about Charles Town; to revive the several Acts therein mentioned; and to call in the former bills of credit." By this Act, not only £8,000 in new bills were issued for payment of the public debts, but the old bills which were outstanding were exchanged for new bills, and were by that means continued current, and made a tender in all payments. This Act was made of force for two years, but was continued for four years, by an Act passed July 12, 1707. This date was shortly extended for another year; and then "to the end of the next session of the General Assembly." By another Act passed February 14, 1707, entitled "an Act for the better enabling the Governour to raise a force against our public enemies, and to raise money to defray the charges of the same, by establishing bills of credit," a further sum of £3,000 was issued in bills of credit, £2,000 of which was to exchange part of the old bills, which were too large, and the other £1,000 was to remain in the treasury, to answer the emergencies of the govern

ment.

A very short time after passing this Act, on April 24, 1708, an Act was passed for raising a further sum of £5,000 in bills of credit, to be ready in the public receiver's hands to answer all emergencies; it provided a fund to sink them, and the duties imposed by the former Acts were continued to July 12, 1714, and from thence to the end of the next session of the General Assembly. On the 1st day of March, 1710, an Act was passed for raising the sum of £3,000 in small bills, for sinking £1,000 of the former bills; and £2,000 to be applied in the payment of the debts due from the public.

The next emission of paper bills of credit was said to be in consideration of the great expense the Province had been at in building fortifications, and for assisting the inhabitants of North Carolina against the Tusquerora Indians, who were then at war with them, with twenty white men and such Indians as could be raised. On these considerations an Act passed November 10, 1711, "for raising the sum of £4,000, by laying sundry additional duties on liquors and other goods and merchandises, for carrying on an expedition against

the northern Indians, enemies to the Crown of Great Britain, and for aiding and assisting the inhabitants of North Carolina, who are now actually invaded by the said Indians."

The Bank Act of June 7, 1712, was "an Act for raising the sum of £52,000, by stamping and establishing new bills of credit, and putting the same out to interest, in order to call in and sink the former bills of credit." From the year 1703 to the time of passing this Act, by the various emissions of bills of credit at the several times hereinbefore mentioned, there had been issued £29,000, which, either by a partial application of the funds appropriated for sinking them, by the exchanging old bills for new, or by bills lost or destroyed by accident, were, at the time of passing this Act, reduced to £16,000, exclusive of the Tusquerora bills, amounting to £4,000.

In the preamble of the Bank Act it is declared "that the public debts, occasioned by the vast charges to which the Province for several years past had been subject and liable . . . . were become at last so greatly burthensome and considerable, that there was no hope or probability that the same could be discharged in any tolerable time, by the public duties and incomes of this Province; and that it was also impracticable (especially at that time) to discharge and defray the same by the ordinary method of imposing a tax on the estates, stocks, and abilities of the inhabitants of the Province, without pressing too hard upon them"; therefore £16,000 was issued for exchanging the old bills; £32,000 to be let out at interest, payable in 12 years, at such a rate as would sink both principal and interest at the end of that term; £4,000 was also directed to be issued for the contingencies of the government. These together with the Tusquerora bills made a total of £56,000. This was 9 years from the date of the first issue.

In 1715 a new series of emissions begins. By an Act of August 27, a further sum of £30,000 in bills of credit were stamped and issued; and it was provided by this Act, that in order to strengthen the currency of the bills newly issued, a fund should be provided for sinking the same by a tax; and accordingly, on the same day there was passed an "Act to raise the sum of £30,000 on the real and personal estates of the inhabitants of this Province, in order to sink the sum of £30,000 in bills of credit."

But within a year another Act was passed, to continue the currency of £30,000 in bills of credit, and also to stamp the sum of