Note 38 — THE CORRESPONDENCE OF ARTHUR LEE, (continued 3)

“In Congress, December 3d, 1777. The great quantity of paper money, issued to defray the necessary expenses of the war, having at length become so considerable as to endanger its credit, and Congress apprehending, that the slow operation of taxes may not be adequate to the prevention of an evil so pernicious in its consequences, and as experience proves, that the method of paying the interest by bills on France does not fill the loan office so fast as the urgent calls of war demand,

“Resolved, That the Commissioners at the Courts of France and Spain be directed to exert their utmost endeavors to obtain a loan of two millions sterling on the faith of the United States, for a term not less than ten years, with permission if practicable to pay the same sooner if it shall be agreeable to these States, giving twelve months’ previous notice to the lender, of such intention to return the money. That the Commissioners be instructed to consider the money hereby directed to be borrowed, as a fund to be applied, unless Congress direct otherwise, solely to the purpose of answering such drafts as Congress shall make for the purpose of lessening the sum of paper money in circulation.

“That in order more effectually to answer the good purposes intended by this plan, the Commissioners be also instructed to keep as secret as the nature of the thing will admit, whatever loan they shall be able to obtain for this purpose on account of the United States.”