The subject yesterday under discussion was resumed. A division of the question was called for by Mr. WOLCOTT, so as to leave a distinct question on the words "to be collected by Congress," which he did not like.

Mr. WILSON considered this mode of collection as essential to the idea of a general revenue, since, without it, the proceeds of the revenue would depend entirely on the punctuality, energy, and unanimity of the states, the want of which led to the present consideration.

Mr. HAMILTON was strenuously of the same opinion.

Mr. FITZSIMMONS informed Congress that the legislature of Pennsylvania had, at their last meeting, been dissuaded from appropriating their revenue to the payment of their own citizens, creditors of the United States, instead of remitting it to the Continental treasury, merely by the urgent representations of a committee of Congress, and by the hope that some general system in favor of all the public creditors would be adopted; that the legislature were now again assembled, and, although sensible of the tendency of such an example, thought it their duty, and meant, in case the prospect of snob a system vanished, to proceed immediately to the separate appropriations formerly in contemplation.

On the motion of Mr. MADISON, the whole proposition was new-modelled, as follows: —

"That it is the opinion of Congress that the establishment of permanent and adequate funds, to operate generally throughout the United States, is indispensably necessary for doing complete justice to the creditors of the United States, for restoring public credit, and for providing for the future exigencies of the war?"

The words "to be collected under the authority of Congress" were, as a separate question, left to be added afterwards.

Mr. RUTLEDGE objected to the term "generally," as implying a degree of x uniformity in the tax which would render it unequal. He had in view, particularly, a land tax, according to quality, as had been proposed by the office of finance. He thought the prejudices of the people opposed the idea of a general tax; and seemed, on the whole, to be disinclined to it himself, at least if extended beyond an impost on trade; urging the necessity of pursuing a valuation of land, and requisitions grounded thereon.

Mr. LEE seconded the opposition to the term "general." He contended that the states would never consent to a uniform tax, because it would be unequal; that it was, moreover, repugnant to the Articles of Confederation and, by placing the purse in the same hands with the sword, was subversive of the fundamental principles of liberty. He mentioned the repeal of the impost by Virginia—himself alone opposing it, and that, too, on the inexpediency in point of time—as proof of the aversion to a general revenue. He reasoned upon the subject, finally, as if it was proposed that Congress should assume and exercise a power immediately, and without the sanction of the states, of levying money on them.

Mr. WILSON rose, and explained the import of the motion to be, that Congress should recommend to the states the investing them with power. He observed that the Confederation was so far from precluding, that it expressly provided for, future alterations; that the power given to Congress by that act was too little, not too formidable; that there was more of a centrifugal than centripetal force in the states, and that the funding of a common debt in the manner proposed would produce a salutary invigoration and cement to the Union.

Mr. ELLSWORTH acknowledged himself to be undecided in his opinion; that, on the one side, he felt the necessity of Continental funds for making good the

Continental engagements; but, on the other, desponded of a unanimous concurrence of the states in such an establishment. He observed, that it was a question of great importance, how far the federal government can or ought to exert coercion against delinquent members of the Confederacy; and that without such coercion, no certainty could attend the constitutional mode which referred every thing to the unanimous punctuality of thirteen different councils. Considering, therefore, a Continental revenue as unattainable, and periodical requisitions from Congress as inadequate, he was inclined to make trial of the middle mode of permanent state funds, to be provided at the recommendation of Congress, and appropriated to the discharge of the common debt.

Mr. HAMILTON, in reply to Mr. ELLSWORTH. dwelt long on the inefficacy of state funds. He supposed, too, that greater obstacles would arise to the execution of the plan than to that of a general revenue. As an additional reason for the latter to be collected by officers under the appointment of Congress, he signified, that, as the energy of the federal government was evidently short of the degree necessary for pervading and uniting the states, it was expedient to introduce the influence of officers deriving their emoluments from, and consequently interested in supporting the power of, Congress.

[Note *: * This remark was imprudent, and injurious to the cause which it was meant to serve. This influence was the very source of jealousy which rendered the states averse to a revenue under collection, as well as appropriation of Congress. All the members of Congress who concurred, in any degree, with the states in this jealousy, stalled at the disclosure. Mr. Bland, and still more Mr. Lee, who were of this number, took notice in private conversation that Mr. Hamilton had let out the secret.]

Mr. WILLIAMSON was of opinion, that Continental funds, although desirable, were unattainable, at least to the full amount of the public exigencies. He thought, if they could be obtained for the foreign debt, it would be as much as could be expected, and that they would also be less essential for the domestic debt.

Mr. MADISON observed, that it was needless to go into proofs of the necessity of paying the public debts; that the idea of erecting our national independence on the ruins of public faith and national honor must be horrid to every mind which retained either honesty or pride; that the motion before Congress contained a simple proposition, with respect to the truth of which every member was called upon to give his opinion; that this opinion must necessarily be in the affirmative, unless the several objects of doing justice to the public creditors, &c. &c., could be compassed by some other plan than the one proposed; that the two last objects depended essentially on the first; since the doing justice to the creditors would alone restore public credit, and the restoration of this would alone provide for the future exigencies of the war. Is, then, a Continental revenue indispensably necessary for doing complete justice, &c.? This is the question. To answer it, the other plans proposed must first be reviewed.

In order to do complete justice to the public creditors. either the principal must be paid off, or the interest paid punctually. The first is admitted to be impossible on any plan. The only plans opposed to the Continental one for the latter purpose are, first, periodical requisitions according to the Federal Articles; secondly, permanent funds established by each state within itself; and the proceeds consigned to the discharge of public debts.

Will the first be adequate to the object? The contrary seems to be maintained by no one. If reason did not sufficiently premonish, experience has sufficiently demonstrated, that a punctual and unfailing compliance, by thirteen separate and independent governments, with periodical demands of money from Congress, can never be reckoned upon with the certainty requisite to satisfy our creditors, or to tempt others to become our creditors in future.

Secondly. Will funds separately established within each state, and the amount submitted to the appropriation of Congress, be adequate to the object? The only advantage which is thought to recommend this plan is, that the states will be with less difficulty prevailed upon to adopt it. Its imperfections are, first, that it must be preceded by a final and satisfactory adjustment of all accounts between the United States and individual states, and by an apportionment founded on a valuation of all the lands throughout each of the states, in pursuance of the law of the Confederation; for although the states do not as yet insist on these prerequisites in the case of annual demands on them, with which they very little comply, and that only in the way of an open account, yet these conditions would certainly be exacted in case of a permanent cession of revenue; and the difficulties and delays, to say the least, incident to these conditions, can escape no one. Secondly, the produce of the funds being always, in the first instance, in the hands and under the control of the states separately, might, at any time, and on various pretences, be diverted to state objects. Thirdly, that jealousy which is as natural to the states as to individuals, and of which so many proofs have appeared, that others will not fulfil their respective portions of the common obligations, will be continually and mutually suspending remittances to the common treasury, until it finally stops them altogether. These imperfections are too radical to be admitted into any plan intended for the purposes in question.

It remains to examine the merits of a plan of a general revenue operating throughout the United States, under the superintendence of Congress.

One obvious advantage is suggested by the last objection to separate revenues in the different states; that is, it will exclude all jealousy among them on that head, since each will know, whilst it is submitting to the tax, that all the others are necessarily at the same instant bearing their respective portions of the burden. Again, it will take from the states the opportunity, as well as the temptation, to divert their incomes froth the general to internal purposes, since those incomes will pass directly into the treasury of the United States.

Another advantage attending a general revenue is, that, in case of the concurrence of the states in establishing it, it would become soonest productive, and would, consequently, soonest obtain the objects in view; nay, so assured a prospect would give instantaneous confidence and content to the public creditors at home and abroad, and place our affairs in a most happy train.

The consequences, with respect to the Union, of omitting such a provision or the debts of the Union, also claimed particular attention. The tenor of the memorial from Pennsylvania, and of the information just given on the floor by one of its delegates, (Mr. FITZSIMMONS,) renders it extremely probable that that state would, as soon as it should he known that Congress had declined such provision, or the states rejected it, appropriate the revenue required by Congress to the payment of its own citizens and troops, creditors of the United States. the irregular conduct of other states on this subject, enforced by such an example, could not fail to spread the evil throughout the whole continent. What, then, would become of the Confederation? What would be the authority of Congress? What the tie by which the states could be held together? What the source by which the army could be subsisted and clothed? What the mode of dividing and discharging our foreign debts? What the rule of settling the internal accounts? What the tribunal by which controversies among the states could be adjudicated?

It ought to be carefully remembered, that this subject was brought before Congress by a very solemn appeal from the army to the justice and gratitude of their country. Besides immediate pay, they ask for permanent security for arrears. Is not this request a reasonable one? Will it be just or politic to pass over the only adequate security that can be devised, and, instead of fulfilling the stipulations of the United States to them, to leave them to seek their rewards separately from the states to which they respectively belong? The patience of the army has been equal to their bravery; but that patience must have its limits, and the result of despair cannot he foreseen, nor ought to be risked.

It has been objected, against a general revenue, that it contravenes the articles of Confederation. These articles, as has been observed, presupposed the necessity of alterations in the federal system, and have left a door open for them. They, moreover, authorize Congress to borrow money. Now, in order to borrow money, permanent and certain provision is necessary; and if this provision cannot be made in any other way, as has been shown, a general revenue is within the spirit of the Confederation.

It has been objected, that such a revenue is subversive of the sovereignty and liberty of the states. If it were to be assumed, without the free gift of the states, tiffs objection might be of force; but no assumption is proposed. In fact, Congress are already invested by the states with the constitutional authority over the puree as well as the sword. A general revenue wound only give this authority a more certain and equal efficacy. They had a right to fix the quantum of money necessary for the common purposes. The right of the states is limited to the mode of supply. A requisition of Congress on the states for money is as much a law to them as their revenue acts, when passed, are laws to their respective citizens. If, for want of the faculty or means of enforcing a requisition, the law of Congress proves inefficient, does it not follow that, in order to fulfill the views of the Federal Constitution, such a change should be made as will render it efficient? Without such efficiency, the end of this Constitution, which is to preserve order and justice among the members of the Union, must fail; as without a like efficiency would the end of state constitutions, which is to preserve like order and justice among their respective members.

It has been objected, that the states have manifested such aversion to the impost on trade, as renders any recommendations of a general revenue hopeless and imprudent. It must be admitted that the conduct of the states on that subject is less encouraging than were to be wished. A review of it, however, does not excite despondence. The impost was adopted immediately, and in its utmost latitude, by several of the states. Several, also, which complied partially with it at first, have since complied more liberally. One of them, after long refusal, has complied substantially. Two states only have failed altogether; and, as to one of them, it is not known that its failure has proceeded from a decided opposition to it. On the whole, it appears that the necessity and reasonableness of the scheme have been gaining ground among the states. He was aware that one exception ought to be made to this inference; an exception, too, which it peculiarly concerned him to advert to. The state of Virginia, as appears by an act yesterday laid before Congress, has withdrawn its assent once given to the scheme. This circumstance could not but produce some embarrassment in a representative of that state advocating the scheme—one, too, whose principles were extremely unfavorable to a disregard of the sense of constituents. But it ought not to deter him from listening to considerations which, in the present case, ought to prevail over it. One of these considerations was, that, although the delegates who compose Congress more immediately represented, and were amenable to, the states from which they respectively come, yet, in another view, they owed a fidelity to the collective interests of the whole: secondly, although not only the express instructions, but even the declared sense of constituents, as in the present case, were to be a law in general to their representatives, still there were occasions on which the latter ought to hazard personal consequences, from a respect to what his clear conviction determines to be the true interest of the former; and the present he conceived to fall under this exception: lastly, the part he took on the present occasion was the more fully justified to his own mind, by his thorough persuasion that, with the same knowledge of public affairs which his station commanded, the legislature of Virginia would not have repealed the law in favor of the impost, and would even now rescind the appeal.

The result of these observations was, that it was the duty of Congress, under whose authority the public debts had been contracted, to aim at a general revenue, as the only means of discharging them; and that the dictate of justice and gratitude was enforced by a regard to the preservation of the Confederacy, to our reputation abroad, and to our internal tranquillity.

Mr. RUTLEDGE complained that those who so strenuously urged the necessity and competency of a general revenue, operating throughout all the United State at the same time, declined specifying any general objects from which such a revenue could be drawn. He was thought to insinuate that these Objects were kept back intentionally, until the general principle could be irrevocably fixed, when Congress would be bound, at all events, to go on with the project; whereupon —

[Note: He was apprehensive that a tax on land according to its quantity, not value, as had been recommended by Mr. Morris, was in contemplation.]

Mr. FITZSIMMONS expressed some concern at the turn which the discussion seemed to be taking. tie said, that, unless mutual confidence prevailed, no progress could be made towards the attainment of those ends which all, in some way, or other, aimed at. It was a mistake to suppose that any specific plan had been preconcerted among the patrons of a general revenue.

Mr. WILSON, with whom the motion originated, gave his assurances that it was neither the effect of preconcert with others, nor of any determinate plan matured by himself; that he had been led into it by the declaration, on Saturday last, by Congress, that substantial funds ought to be provided; by the memorial of the army from which that declaration had resulted; by the memorial from the state of Pennsylvania, holding out the idea of separate appropriations of her revenue unless provision were made for the public creditors; by the deplorable and dishonorable situation of public affairs, which had compelled Congress to draw bills on the unpromised and contingent bounty of their ’ally, and which was likely to banish the superintendent of finance, whose place could not be supplied, from his department. He observed, that he had not introduced details into the debate, because he thought them premature, until a general principle should be fixed; and that, as soon as the principle should be fixed, he would, although not furnished with any digested plan, contribute all in his power to the forming such a one.

Mr. RUTLEDGE moved. that the proposition might be committed, in order that some practicable plan might be reported before Congress should declare that it ought to be adopted.

Mr. IZARD seconded the motion, from a conciliatory view.

Mr. MADISON thought the commitment unnecessary, and would have the appearance of delay; that too much delay had already taken place; that the deputation of the army had a right to expect an answer to their memorial as soon as it could be decided by Congress. He differed from Mr. Wilson in thinking that a specification of the objects of a general revenue would be improper, and thought that those who doubted its practicability had a right to expect proof of it from details, before they could be expected to assent to the general principle; but he differed also from Mr. Rutledge, who thought a commitment necessary for the purpose; since his views would be answered by leaving the motion before the House, and giving the debate a greater latitude. He suggested, as practicable objects of a general revenue, first, an impost on trade; secondly, a poll-tax under certain qualifications; thirdly, a land-tax under ditto.*

[Note *: * A poll-tax to be qualified by rating blacks somewhat lower than whites; a land-tax, by considering the value of land in each state to be in an inverse proportion of its quantity to the number of people; and apportioning on the aggregate quantity in each state accordingly, leaving the state at liberty to make a distributive apportionment on its several districts on a like or any other equalizing principle.]

Mr. HAMILTON suggested a house and window tax. He was in favor of the mode of conducting the business urged by Mr. Madison.

On the motion for the commitment, six states were in favor of it, and five against it; so it was lost. In this vote, the merits of the main proposition very little entered.

Mr. LEE said, that it was a waste of time to be forming resolutions and settling principles on this subject. He asked whether these would ever bring any money into the public treasury. His opinion was, that Congress ought, in order to guard against the inconvenience of meetings of the different legislatures, at different and even distant periods, to call upon the executives to convoke them all at one period, and to lay before them a full state of our public affairs. He said, the states would never agree to those plans which tended to aggrandize Congress; that they were jealous of the power of Congress, and that he acknowledged himself to be one of those who thought this jealousy not an unreasonable one; that no one who had ever opened a page, or read a line, on the subject of liberty, could be insensible to the danger of surrendering the purse into the same hands which held the sword.

The debate was suspended by an adjournment.

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