CHAP. I. detached to seize it, and bring it to the conti1776. nent. The delays after landing were such,

that the governor obtained intelligence of his approach, long enough before he reached the town, to remove the powder: and thus the expedition failed of its principal object; but other military stores of considerable value were taken; and on its return, the fleet made several prizes.

On the east end of Long island, commodore Hopkins fell in with the Glasgow, captain Howe, carrying twenty, nine pounders, and an engagement ensued, which lasted several hours. The Glasgow, after having damaged the vessels of the American flotilla very considerably, made all sail for Newport, and was not pursued. That she was able to maintain a close fight, a considerable time, with a force so very superior to her own, and then to extricate herself from it, excited some chagrin in America, and the conduct of the commodore was very much censured.

When the seat of war was transferred to New York, and some of the British ships passed up the North river, an experiment was made of the efficacy of a defence by gallies, which had been, in some degree, relied on. A detach

ment of soldiers was put on board them, and the Phoenix, lying at anchor in the bay of Haverstraw was attacked by them. The experiment turned out unfavourably. The Phoenix

sustained little, if any injury, and the gallies CHAP. I. were repulsed with the loss of several of them. 1776. which were sunk in the action.

The extraordinary spectacle has been exhibited of thirteen distinct colonies, possessing at first no legitimate government; and afterwards when they became states, possessing governments entirely independent of each other, carrying on, conjointly, by themselves and by their deputies, a burdensome war against one of the most powerful nations of the world; raising armies on the most expensive, as well as dangerous establishment; carrying on distant expeditions, and equipping an efficient, though a small navy; without commerce, and without Credit became a substitute for revenue; but it required all the zeal and enthusiasm which then animated the bosoms of individuals, and which silenced for a time every calculation of cold and interested prudence, to furnish this substitute.

revenue.

Congress emitted paper money, and pledged Paper money the faith of their constituents for its redemption. The opinion was almost universal, that this faith would be sacredly observed. In some of the colonies, as in Virginia, depreciation had never been known. Only small sums of paper had been issued, and those sums had been mostly called in by taxes, without having ever taken a real, inferior to their nominal value. Among persons thus circumstanced,

CHAP. I. paper was received without suspicion, and its 1776. depreciation was not soon observed. To the eastward, and further to the southward, where

the subject was better understood, the enthusiasm with which they engaged in the contest, and the hope that it would not be of long duration, furnished motives for giving a value to paper, which overbalanced the apprehensions their past experience might otherwise have excited.

There were other causes which, in some degree, aided the first admission of paper bills into common circulation. The nature of the colonial commerce had not been favourable to the introduction of large quantities of specie. There were in America but few large cities. The people were spread over an extensive country, covered with woods, which they cleared with immense labour, and the soil of which they cultivated for subsistence. Having but little of that circuitous commerce, of which the precious metals will, necessarily, in part, constitute a medium; their produce was remitted directly to the country from whence their goods were received, and the surplus almost immediately assumed the form of labour, for the cultivation and improvement of their lands. This was more especially the situation of the middle and southern colonies, whose commerce was chiefly in the hands of British merchants, who received the crops of the plan

ters, furnished them with goods, and gave the CHAP. I. industrious credit for the purchase of lands or 1776. slaves. This species of commerce would introduce and require, in a new country, but very inconsiderable quantities of the precious metals.

When the intercourse with Great Britain was cut off, and the credit of the people of the country with their merchants no longer existed, a part of the gold and silver in circulation, at no time equal to the demand, disappeared. This effect was produced, in part, by remittances to Europe; in part by collections made by government for essential purposes, among which was the expedition to Canada; and perhaps, still more, by being hoarded up by those who, not being under the influence of the general feeling, foresaw the effects which must be produced by the large emissions the war would render inevitable. This diminution of the quantity of the precious metals, connected with the loss of that particular species of credit which had been found to be a substitute for specie, produced a real necessity for a circulating medium, to answer the ordinary purposes of society. This necessity, which for the moment was very sensibly felt, co-operated, with the real patriotism of the great body of the people, to facilitate the circulation, on a par with gold and silver, of bills of credit issued by an authority which all acknowledged; and

CHAP. I. although no specific funds were pledged for 1776. their redemption, nor were there any in' the

power of government in any degree competent to that object; yet common opinion supplied the want of these substantial requisites, and he would have been thought a traitor to his country, who had manifested a suspicion that the public faith would not be religiously observed. On this delicate subject, a resolution of congress was passed so early as January 1776, denouncing against those who should discourage the circulation of the paper money, the penalty of being held up as enemies of their country.

It was however impossible that this delusion could be permanent, or that it should, in the first instance, be complete with men of reflection and experience. Although a confidence in the engagements of government might not for a time be shaken; yet as the paper bills were continually emitted, without being capable of finding their way into other countries, it was impossible to conceal, from those who would permit themselves to think, the dangerous truth, that the mere quantity in circulation, would so sensibly impair their value, as to render impracticable their redemption at par.

This truth, however, which was not universally perceived, was cautiously concealed by the friends of the revolution; and if uttered by its enemies, the declaration was deemed a