To Oliver Wolcott, Junior
[New York, May 30, 1796]
I perceive Congress are invading the Sinking Fund system.1 If this goes through & is sanctionned by the President the fabric of public Credit is prostrate & the Country & the President are disgraced. Treasury Bills & every expedient however costly to meet exigencies must be preferable in the event to such an overthrow of system.
ALS, Connecticut Historical Society, Hartford; copy, Hamilton Papers Library of Congress.
1. “An Act making provision for the payment of certain Debts of the United States” provided “That it shall be lawful for the commissioners of the sinking fund, with the approbation of the President of the United States, to borrow, or cause to be borrowed, on the credit of the United States, any sum not exceeding five millions of dollars, to be applied to the payment of the capital, or principal of any parts of the debt of the United States now due, or to become due, during the course of the present year, to the bank of the United States, or to the bank of New York, or for any instalment of foreign debt; And that, for the whole, or such part of the said sum, as shall be borrowed, certificates shall be issued, purporting that the United States are indebted for the sums to be therein expressed, bearing an interest of six per centum per annum, payable quarter yearly; which sums, at the said rate of interest, are to remain fixed and irredeemable, until the close of the year one thousand eight hundred and nineteen, and to be redeemed thereafter, at the pleasure of the United States: And the Bank of the United States is hereby authorized to lend the whole, or any part, of the said five millions of dollars, and to sell the stock received for such loan.…
“And it shall be lawful for the commissioners of the sinking fund, if they shall find the same to be most advantageous, to sell such and so many of the shares of the stock of the bank of the United States, belonging to the United States, as they may think proper; and that they apply the proceeds thereof to the payment of the said debts, instead of selling certificates of stock, in the manner prescribed in this act.…” (1 Stat. description begins The Public Statutes at Large of the United States of America (Boston, 1845). description ends 488–89 [May 31, 1796].)
For the debates on this bill in the Senate on May 17, 1796, and in the House on May 23, 24, and 28, 1796, see Annals of Congress description begins The Debates and Proceedings in the Congress of the United States: with an Appendix, Containing Important State Papers and Public Documents, and All the Laws of a Public Nature (Washington, 1834–1849). description ends , V, 95–96, 1430–50, 1466–72.