The Board of Trade
to Governor Glen (1750)

When the Board of Trade received Governor Glen's letter, they composed an acid response, which was transmitted to Governor Glen on November 15, 1750. The Board implied the information that had been sent them was inaccurate, and that South Carolina actually had no need for paper money. Source: Records in the British Public Records Office relating to South Carolina, XXIV, pp. 158-68.
We come now to that Letter of yours which relates to the internal State of Your Government. And before we make any observations [p. 159] on the Reasons given in your Letter to evince the Necessity of a Paper Currency in your Province and what else you have said upon the Subject, it will be proper to tell you that the Report of the Committee of Conference which you have sent us on the present State of Paper Currency in your Province, and the Bills now outstanding differs from an Account which we have had prepared here for our Use from the several Acts of Assembly which have been passed in your Government for emitting such Currency. We will state to you what We understand to be the Amount of the Paper Currency at present outstanding in your Province and the operations which every Act has had, that you may compare our State with that of the Committee and explain the Reason of their differing.

From the year 1703, when the Province of South Carolina first began to issue Paper Money, to the year 1743 there were issued as follows viz.
8th May 1703 ------------------------------- 6,000
5th July 1707 ------------------------------- 8,000
4th Feb. 1707 ------------------------------- 3,000 [p. 160]
24th Apl 1708 ------------------------------- 5,000
1st Mar. 1710 ------------------------------- 3,000
10th Nov. 1711 ------------------------------- 4,000
7th June 1712 ------------------------------ 36,000
27th Aug 1715 ------------------------------ 30,000
24th Mar. 1715 ------------------------------ 5,000
21st June 1716 ------------------------------ 15,000
23rd Feb. 1719 -------------------------------- 34,000
Do 1722 -------------------------------- 40,000

The several Laws upon which these Sums were issued, provided Funds for the due payment of them, upon which the Bills were to be sunk & Cancelled; but as these Provisions were set aside the obligation of many of the Acts broke thro, and the Funds diverted to other purposes, there remained outstanding in the year 1723 120,000.

On the 15th of February 1723, an Act was passed entitled an Act for calling and sinking the Publick Bills of Credit, in which Provision was made for Cancelling the Sum of 55,000 only of the said Bills &c. the Remainder of 65,000 was continued current.

By the operation of this Act 13,500 was [p. 161] sunk, but in 1727, the Assembly suspended the Execution of this Act applying the Duties appropriated for sinking the Bills of Credit to defray the Charges of an Expedition to St Augustine.

After this Expedition the Merchants trading to Carolina petition'd the Crown in 1731, further to suspend the Execution of the sinking Fund Act for seven years and that the Duties arising from it might be applied to the settling Foreign Protestants. The Petition was complied with, and upon an Instruction to the Governor an Act was passed for that purpose, but the Assembly were so far from Appropriating those Duties to the Purpose for which they were intended that they passed a Law for appropriating them to the Cancelling certain publick orders which had been issued for the Services of Government.

Upon the complaint of the Merchants this Act was repealed, and in 1735, An Act passed for appropriating the Duties of the Sinking Fund Act to the Settlement of Poor Protestants, in which Provision was also made for sinking the Publick Orders.

In the Year 1739 both the sinking [p. 162] Fund and appropriation Acts expired, so that there remained outstanding without any Funds for calling them in 106,500.

Since that time there have been issued the following Sums in publick orders, viz.
5th March 1736/7 35010
5th April 1740 25000
19th Sept. 1740 11508
10th July 1742 63000
21st May 1745 20000
Of these Sums there appear to have been Cancelled 72,800
remains outstanding in old Bills 106,500
Publick Orders 81,718

You observe that this State agrees exactly with yours as to the old Bills of Credit, but it differs greatly from it as to the Publick Orders, of which the Committee state only 63000 to have been issued. The Difference upon the whole is 55,173 . 5 . 0

The Reason you urge to shew the necessity of permitting some Paper Currency in your Province are the strongest and most convincing that can [p. 163] be urged to prove that it does not want it. You tell us that you are a new and improving Province, that you doubt not but your exported Produce sufficiently Pays for all your Importations from Great Britain and leaves a Surplus in your favour of several Thousand Pounds Sterling; and if this be the state of your Trade, that Balance which you say you have is the best Proof that you want not a Paper Currency, which is only necessary to a People, who have not the Balance of Trade in their Favour, and who having no Goods or Gold, to remit to pay for the Exceeding of their Imports, are the only Country which in its Trade can want a Paper Currency. We observe that in a Report published by order of the General Assembly of your Government in 1739, on the state of paper Currency the Necessity of a Paper Currency is argued entirely from a Supposition that the Imports of So. Carolina exceed the Exports it is there admitted that where the Balance of Trade is in favour of the Colony the Trade itself will supply what is the Established and best Medium of Trade, and nothing is urged in that Report to shew that the Imports of your Province do exceed [p. 164] your Exports, but an assertion that there is no Gold or Silver to be ever found in the Province, which is more easily accounted for, by the Quantity of Paper Currency itself, which naturally drives away the Currency of Gold and Silver wherever it prevails. If you had sent us over an account of the Imports as well as the Exports of your Province, We should have been better able to judge of the truth of the Real Balance of your Trade, by having a full State of it before us, but at present, from the Lights We have We are inclined to think with you that the balance of your whole Trade, is in favour of your Government.

You say it would be imprudent in the Province to buy Gold and Silver wth this Balance in which We are at a loss to discover your meaning, for if in your Barter with other Nations there remains a Surplus due to you, which we suppose is in no case left a Debt, how can that Balance be remitted to you, but in Gold or Silver? You add also that it is Wisest in the Province to buy Slaves with it, which Slaves will raise more Rice &c. which you say will increase this Balance, and which, if you will [p. 165] pursue your Reasoning throughout, will as necessarily increase the Gold and Silver, & consequently in proportion as it increases, make Paper Currency, the substitute of Bullion still more unnecessary.

We did not expect to hear the manner in which the Paper Currency of your Government has been conducted urged as a Reason for continuing it, & it is with a degree of Astonishment We find your Province praised for having punctually observed the appropriations of these Acts and kept the Publick Faith inviolable. Is it possible you should have ever examined any State of your Paper Currency, and not seen the Evasive manner in which from time to time upon pretence of Necessity & upon every general Reason of State the greater number of these Acts have been prevented in their due operation? Insomuch that every Currency Bill from 1703 to this Day has a Clause for issuing more money and a Clause for cancelling the whole then in being the first of which is always executed and the latter has been never once performed agreeable to Law?

As to the Payment of Quit Rents which [p. 166] you give as a Reason for allowing some Paper Currency, you might have remembered that by your 106th Instruction all Quit Rents are directed to be passed [sic?] in Proclamation Money.

You cannot but be sensible that your opinion with regard to the necessity of a paper Currency has been suddenly and greatly altered: Since in your Letter to us dated the 14th of April 1748, wherein you give us an Account of your refusal to pass a Law for issuing Paper Money, you say you begged the Assembly to consider the fatal Consequences wch had attended such Measures in other parts of America, for that some Provinces by giving way to such temporary Expedients, and opening these Flood gates and Sluices, had been overwhelmed with an Inundation of Paper Money. And in another Letter dated the 24th of July following you say that the Province was in a Condition to have raised the Money wanted, by an additional Tax without having recourse to such an Expedient as Paper in Lieu of Money, and then state to us the Trade of the Province, the Exceedings of the Exports, and the Charges of Government. [p. 167]

But whatever Reasons you may think there are to shew the necessity of admitting some Paper Currency in your Province, there cannot even upon your own Reasoning be any for permitting an Increase of the present quantity. What has been sufficient for the Occasions of your Government and Commerce of it of late years when your Trade has ben in it's Infancy and Expences incurred on great and Extraordinary Service will doubtless very amply Answer every occasion which can arise in your Province at present when you are in a State of Peace advancing every year in your Trade and adding to the Balance of it. You say yourself that you are a new and improving Province, Your Exports last year Amounted to 146000 which is 46000 more than they were the first year after the War, the Charges of Government are but 9000, and for these Reasons We have resolved, and We think it proper to inform you of it to recommend it to the Crown to revoke your 99th Instruction, and that you should be Instructed never gain to give your consent to any Act for emitting any additional Bills of Credit, but to [p. 168] use the most pressing Endeavours with the General Assembly of your Province to get Funds Established by proper Acts for the Payment of the 106000 now outstanding, the Funds for the Payment of which are expired.

See Governor Glen's response.

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