burned Salmon Falls, and laid Schenectady in ashes. Driven to extremity, the English rallied, and in a congress at New York in 1690 resolved on the conquest of Canada. New York and Connecticut were to send a land force against Montreal. Massachusetts and Plymouth sent a fleet against Quebec. Acadia fell, Port Royal surrendered, and New England ruled the coast to the eastern end of Nova Scotia. There success stopped. The commanders of the English troops fell to quarreling, and the land expedition failed miserably. Frontenac, having no foe to oppose him, hurried to Quebec, and entered the city just as the New England fleet came sounding its way up the St. Lawrence. The summons to surrender the city was received with jeers. The fleet, unable to take Quebec without the aid of the army, sailed for Boston, to be scattered by storms along the coast. To commemorate this signal deliverance the French put up the Church of our Lady of Victory. To pay the cost of the expedition Massachusetts issued the first colonial paper money. In 1703 South Carolina followed her example.

Scarcely had King William's war ended than Queen Anne's war broke out. Again the French and Indians came down from Canada, and, while Franklin was a child, laid waste the towns of Massachusetts with fire and sword. Again the colonies sent ships and troops against Canada. Again they failed, and, to pay the cost, New Hampshire, Connecticut, Rhode Island, New York, and New Jersey imitated Massachusetts and put out bills of credit.

These early issues of credit-bills are not to be confounded with the "banks of paper money" of a later time. The amounts were small. The purpose was the payment of some pressing debt. But after the close of Queen Anne's war the belief sprang up in the minds of men that it was the duty of a government to provide a circulating medium, and that just as fast as that medium disappeared, the duty of the government was to make more. The colonists were heavy traders; the balance of trade was against them. Their specie went over to England, and, unable to practice that self-denial necessary to bring the specie back, they clamored for a currency. Then the colonies turned pawn-brokers and money-lenders, set up loan offices, and issued banks of paper money. Then whoever held a mortgage, or owned the deed of an acre of land, or was possessed of a silver tankard or a ring of gold, might, if he chose, carry it to the loan office, leave it there, and take away in exchange a number of paper bills. In this folly Massachusetts led the way, in 1714, with a bank of fifty thousand pounds; New York, Rhode Island, South Carolina, quickly followed, and before seven years were gone the loan office was established in Pennsylvania and New Jersey.

This was inevitable. The trade of New Jersey was with New York. The people of New York had a paper currency, and paid in paper for every cord of wood and for every boat-load of potatoes that came over the bay. These paper bills of New York, passing current with the farmers of New Jersey, drove out of circulation every pistole, every carolin, every chequin, every piece-of-eight, the bounds of the colony contained; for the ingenuity of man never has and never can devise a plan for the common circulation of specie and debased paper bills.

Thus, when 1723 came, the people of the Jerseys were paying their debts with the money of New York, and their taxes with bits of plate, ear-rings and finger-rings, watches, and jewelry of every sort. Nor were coins much more plentiful in Pennsylvania. A few light pistoles, a few pieces-of-eight, a few English shillings, passed from hand to hand. But so far were they from supplying the needs of trade that the men of Chester besought the Assembly to make produce a legal tender, to prohibit the exportation of coin, and to add one more shilling to the Spanish dollar. The merchants of Philadelphia and the traders of Bucks sent up petitions for a paper currency. Most of these prayers were heard. Another shilling was added to the dollar; produce was made a legal tender, and the best of all forms of colonial paper money was emitted. The bank was limited to fifteen thousand pounds; four thousand to pay the debts of the province, and eleven thousand to be loaned to the people. As the law distinctly stated that the new money was to relieve the distress of the poor, no man was suffered to borrow more than one hundred pounds. Nor could he have even that unless he came to the loan office and deposited plate of three times the value, or mortgaged lands, houses, or ground-rents of twice the value of the sum he received, and agreed to pay into the treasury each year five per centum interest and one eighth the principal. So quickly were the bills taken up, and so much were they liked, that another bank of thirty thousand pounds was issued before the year went out.

When the Lords of Trade heard of these proceedings, they hastened to send back a disapproval and a warning. The governor was bidden to recall the evils that had come upon other colonies from making bills of credit. The people were assured that nothing but tenderness for the men in whose hands the new money was prevented the acts being laid before the king for repeal. A warning was given that, should any more acts emitting paper money be passed, they would surely be disallowed. On the first of March, 1731, the bills were to become irredeemable, and as that day came nearer and nearer the merchants and traders grew more and more uneasy, and more and more doubtful what to do. The opponents of paper money dwelt much on the danger of such a currency and the threat of the Lords of Trade. The friends of paper money had much to say of the brisk times that followed the issues of 1723.

But the arguments that prevailed most, the arguments that brought over the doubting, that persuaded the governor and the assembly, in open defiance of the orders from England, not only to reissue the old money, but to put out thirty thousand pounds of new, were contained in a little pamphlet from the pen of Franklin, entitled "A Modest Inquiry into the Nature and Necessity of a Paper Currency."

"There is," he begins by saying, "a certain quantity of money needed to carry on trade. More than this sum can be productive of no real use. Less than this quantity is always productive of serious evils. Lack of money in