Diary

Author: Benjamin Rush

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Benjamin Rush

Founding Fathers Fight Inflation

[1776]

February 14, 1777

Upon the question whether the Congress should recommend to the States to adopt the plan for reducing and regulating the price of labor, manufactures, imports, and provisions which had been adopted in the four New England States.

It was said in the negative by Mr. James Smith. That such a recommendation would interfere with the domestic policies of each State which were of too delicate a nature to be touched by the Congress.

Dr. Rush: I am against the whole of the resolution. It is founded in the contrary of justice, policy and necessity as has been declared in the resolution. The wisdom and power of government have been employed in all ages to regulate the price of necessaries to no purpose. It was attempted in England in the reign of Edward II by the English parliament, but without effect. The laws for limiting the price of everything were repealed, and Mr. Hume who mentions this fact records even the very attempt as a monument of human folly.

The Congress with all its authority has failed in a former instance of regulating the price of goods. You have limited Bohea tea to ¾ of a dollar, and yet it is daily sold before your eyes for 30s. The Committee of Philadelphia limited the price of West India goods about a year ago. But what was the consequence? The merchants, it is true, sold their rum, sugar and molasses at the price limited by the committee, but they charged a heavy profit upon the barrel, or the paper which contained the rum or the sugar.

Consider, Sir, the danger of failing in this experiment. The salvation of this continent depends upon the authority of this Congress being held as sacred as the cause of liberty itself. Suppose we should fail of producing the effects we wish for by the resolution before you. Have we any character to spare? Have we committed no mistakes in the management of the public affairs of America? We have, Sir. It becomes us therefore to be careful of the remains of our authority and character.

It is a common thing to cry aloud of the rapacity and extortion in every branch of business, etc., among every class of men. This has led some people to decry the public virtue of this country. We estimate our virtue by a false barometer when we measure it by the price of goods. The extortion we complain of arises only from the excessive quantity of our money. Now, Sir, a failure in this attempt to regulate the price of goods will encrease the clamors against the rapacity of dealers, and thus depreciate our public virtue.

Consider, Sir, the consequence of measuring our virtue by this false standard. You will add weight to the arguments used at St. James’s to explode patriotism altogether, and by denying its existence in this country destroy it forever. Persuade a woman that there is no such thing as chastity, and, if there is, that she does not possess it, and she may be easily seduced if she was as chaste as Diana. Sir, the price of goods may be compared to a number of light substances in a bason of water. The hand may keep them down for a while, but nothing can detain them on the bottom of the bason but an abstraction of the water. The continent labours under a universal malady. From the crown of her head to the sole of her feet she is full of disorders. She requires the most powerful tonic medicines. The resolution before you is nothing but an opiate. It may compose the continent for a night, but she will soon awaken again to a fresh sense of her pain and misery.

Colonel Richard Lee, in the affirmative. Mr. President, The learned Doctor has mistook the disorder of the continent. She labours under a spasm, and spasms, he knows, require palliative medicines. I look upon the resolution before you only as a temporary remedy. But it is absolutely necessary. It is true the regulations formerly recommended by Congress were not faithfully carried into execution, but this was owing to the want of regular governments. New and regular governments have been instituted in every part of America, and these will enable all classes of people to carry the resolution into execution.

Mr. Samuel Chase, in the affirmative. Mr. President, this is a necessary resolution. It is true it failed formerly in Philadelphia because it abounded with Tories. But it succeeded in Maryland. It must be done. The mines of Peru would not support a want at the present high price of the necessaries of life. Your soldiers cannot live on their pay. It must be raised unless we limit the price of the clothing and other articles necessary for them.

Mr. Seargant, Negative. The price of goods cannot be regulated while the quantity of our money and the articles of life are allowed to fluctuate

Colonel James Wilson, Negative. There are certain things, Sir, which absolute power cannot do. The whole power of the Roman emperors could not add a single letter to the alphabet. Augustus could not compel old bachelors to marry. He found out his error, and wisely repealed his edict lest he should bring his authority into contempt. Let us recommend the resolution to the consideration of the States only without giving our opinion on it, that they may discuss it with unbiassed minds.

Dr. Witherspoon, Negative. Sir, it is a wise maxim to avoid those things which our enemies wish us to practise. Now I find that our enemies have published the act of the assembly of Connecticut for regulating the price of necessaries in the New York paper in order to shew our distress from that quarter. Remember laws art not almighty. It is beyond the power of despotic princes to regulate the price of goods. I fear if We fail in this measure we shall weaken the authority of Congress. We shall do mischief by teaching the continent to rest upon it. If we limit one article, we must limit every thing, and this is impossible.

Mr. John Adams, Negative. Perhaps I may here speak against the sense of my constituents, but I cannot help it. I much doubt the justice, policy and necessity of the resolution. The high price of many articles arises from their scarcity. If we regulate the price of imports we shall immediately put a stop to them forever.

Dr. Rush. Sir, it has been said that the high price of goods in Philadelphia arose from the monopolies and extortion of the Tories. Here I must say the Tories are blamed without cause. A similar spirit of speculation prevails among the Whigs in Philadelphia. They are disposed to realise thief money in lands or goods. But this is not owing to any timidity or disaffection among them. They fear the further depreciation of your money by future emissions. Stop your emissions of money and you will stop speculation. I am not apt to reply to words, much less to play upon them. The gentleman from Virginia has miscalled the malady of the continent. It is not a spasm, but a dropsy. I beg leave to prescribe two remedies for it. (1) Raising the interest of the money we borrow to six per cent. This, like a cold bath, will give an immediate spring to our affairs; and (2) taxation. This, like tapping, will diminish the quantity of our money, and give a proper value to what remains.

The resolution was amended. The plan of the four New England States was referred only to the other States, to act as they thought proper.

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Chicago: Benjamin Rush, Diary, ed. Benjamin Rush in History in the First Person: Eyewitnesses of Great Events: They Saw It Happen, ed. Louis Leo Snyder and Richard B. Morris (Harrisburg, Pa.: Stackpole Co., 1951), Original Sources, accessed July 3, 2022, http://originalsources.com/Document.aspx?DocID=7AYI543RJHXB6J6.

MLA: Rush, Benjamin. Diary, edited by Benjamin Rush, in History in the First Person: Eyewitnesses of Great Events: They Saw It Happen, edited by Louis Leo Snyder and Richard B. Morris, Harrisburg, Pa., Stackpole Co., 1951, Original Sources. 3 Jul. 2022. http://originalsources.com/Document.aspx?DocID=7AYI543RJHXB6J6.

Harvard: Rush, B, Diary, ed. . cited in 1951, History in the First Person: Eyewitnesses of Great Events: They Saw It Happen, ed. , Stackpole Co., Harrisburg, Pa.. Original Sources, retrieved 3 July 2022, from http://originalsources.com/Document.aspx?DocID=7AYI543RJHXB6J6.