that coin. The same act of parliament which 
suppressed ten and five shilling bank notes
suppressed likewise this optional clause, and 
thereby restored the exchange between England 
and Scotland to its natural rate, or to 
what the course of trade and remittances might 
happen to make it. 
In the paper currencies of Yorkshire, the 
payment of so small a sum as 6d. sometimes 
depended upon the condition, that the holder 
of the note should bring the change of a guinea 
to the person who issued it; a condition 
which the holders of such notes might frequently 
find it very difficult to fulfil, and which 
must have degraded this currency below the 
value of gold and silver money. An act of parliament
accordingly, declared all such clauses 
unlawful, and suppressed, in the same manner 
as in Scotland, all promissory notes, payable 
to the bearer, under 20s. value. 
The paper currencies of North America 
consisted, not in bank notes payable to the 
bearer on demand, but in a government paper
of which the payment was not exigible till 
several years after it was issued; and though 
the colony governments paid no interest to the 
holders of this paper, they declared it to be, 
and in fact rendered it, a legal tender of payment 
for the full value for which it was issued
But allowing the colony security to 
be perfectly good, L.100, payable fifteen years 
hence, for example, in a country where interest 
is at six per cent., is worth little more than 
L.40 ready money. To oblige a creditor
therefore, to accept of this as full payment 
for a debt of L.100, actually paid down in 
ready money, was an act of such violent injustice
as has scarce, perhaps, been attempted 
by the government of any other country which 
pretended to be free. It bears the evident 
marks of having originally been, what the honest 
and downright Doctor Douglas assures 
us it was, a scheme of fraudulent debtors to 
cheat their creditors. The government of 
Pennsylvania, indeed, pretended, upon their 
first emission of paper money, in 1722, to 
render their paper of equal value with gold 
and silver, by enacting penalties against all 
those who made any difference in the price of 
their goods when they sold them for a colony 
paper, and when they sold them for gold and 
silver; a regulation equally tyrannical, but 
much less effectual, than that which it was 
meant to support. A positive law may render 
a shilling a legal tender for a guinea, because 
it may direct the courts of justice to 
discharge the debtor who has made that tender
but no positive law can oblige a person 
who sells goods, and who is at liberty to sell 
or not to sell as he pleases, to accept of a shilling 
as equivalent to a guinea in the price of 
them. Notwithstanding any regulation of this 
kind, it appeared, by the course of exchange 
with Great Britain, that L.100 sterling was 
occasionally considered an equivalent, in some 
of the colonies, to L.130, and in others to so 
great a sum as L.1100 currency; this difference 
in the value arising from the difference 
in the quantity of paper emitted in the different 
colonies, and in the distance and probability 
of the term of its final discharge and 
No law, therefore, could be more equitable 
than the act of parliament, so unjustly complained 
of in the colonies, which declared
that no paper currency to be emitted there in 
time coming, should be a legal tender of payment
Pennsylvania was always more moderate in 
its emissions of paper money than any other 
of our colonies. Its paper currency, accordingly, 
is said never to have sunk below the 
value of the gold and silver which was current 
in the colony before the first emission of 
its paper money. Before that emission, the 
colony had raised the denomination of its coin
and had, by act of assembly, ordered 5s. sterling 
to pass in the colonies for 6s. 3d., and 
afterwards for 6s. 8d. A pound, colony currency
therefore, even when that currency was 
gold and silver, was more than thirty per 
cent. below the value of L.1 sterling; and 
when that currency was turned into paper, it 
was seldom much more than thirty per cent
below that value. The pretence for raising 
the denomination of the coin was to prevent 
the exportation of gold and silver, by making 
equal quantities of those metals pass for 
greater sums in the colony than they did in 
the mother country. It was found, however, 
that the price of all goods from the mother 
country rose exactly in proportion as they 
raised the denomination of their coin, so that 
their gold and silver were exported as fast as 
The paper of each colony being received in 
the payment of the provincial taxes, for the 
full value for which it had been issued, it necessarily 
derived from this use some additional 
value, over and above what it would have 
had, from the real or supposed distance of the 
term of its final discharge and redemption
This additional value was greater or less, according 
as the quantity of paper issued was 
more or less above what could be employed in 
the payment of the taxes of the particular colony 
which issued it. It was in all the colonies 
very much above what could be employed 
in this manner
A prince, who should enact that a certain 
proportion of his taxes should be paid in a paper 
money of a certain kind, might thereby 
give a certain value to this paper money, even 
though the term of its final discharge and redemption 
should depend altogether upon the 
will of the prince. If the bank which issued 
this paper was careful to keep the quantity of 
it always somewhat below what could easily 
be employed in this manner, the demand for 
it might be such as to make it even bear a