Rep. Benjamin Goodhue of Massachusetts to Michael Hodge,
February 24, 1790
(Courtesy of the Peabody Essex Museum)
By 1790 most of the
debt certificates were no longer in the hands of those Americans who had actually loaned
money or given services to the United States. Madison believed strongly that justice
required that these original creditors should receive something, even if they had sold
their certificates for far less than face value. He proposed on February 11 that holders
of public securities originally issued to someone else--holders who were often castigated
as speculators--receive the highest market value of such securities, and that the balance
of the sum due from the public be paid to the original holder. Opponents of this
discrimination saw it as an unconstitutional violation of contracts. The motion lost on
February 22 by a vote of 36 to 13. The focus of the debate on Hamilton's report then
turned to the assumption of state debts. Northern congressmen supported the proposal as
strongly as southerners opposed it. In this letter a vocal supporter states his position.
Text transcript of Rep. Goodhue's letter.