USA > North Carolina > History of North Carolina: The Colonial and Revolutionary Periods 1584 1783, Volume I > Part 41
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GOVERNOR ABNER NASH From a portrait in the Governor's office, Raleigh
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contest for Martin with all the eagerness of avengers of imaginary wrongs. "Among others," wrote Maclaine, "I interested myself warmly for the present Governor, not only from principle, but in opposition to a man who had base- ly abandoned his important trusts, and deserted his colors in the hour of distress."4 Caswell himself describing the contest in a letter to his son, William Caswell, wrote: "Ten days ago Governor Martin was re-elected by 66 Votes against 49 who voted for me. Mr. Johnston and General Ruther- ford were in nomination, but neither was Voted for. The Edenton and Halifax men with a very few exceptions Voted for Governor Martin, saying I had erammed him down their throats last year and they were now determined to keep him there." In this election there appeared for the first time in our history the tendency, which so long prevailed in North Carolina, to divide in political matters along sectional lines. The West supported Martin, while the East, with the excep- tion of the men of the Edenton and Halifax districts, who were moved by the motive mentioned by Caswell, and a few Cape Fear men, who wanted the help of the West in making Cross Creek the capital of the new State, supported Cas- well. The contests, which have been described, show clearly that by 1783, the unanimity and harmony that had prevailed among the patriots in 1774 and 1775 had disappeared, that the factions of 1776 had become stronger and more clearly defined, and that they needed only the struggle that was yet to come over the Federal Constitution to turn them into full fledged political parties. Never again was North Carolina to enjoy that political unity and harmony that marked the opening days of the Revolution.
At the very time that the factions in the patriot party were becoming more and more irreconcilable, the Loyalists, recovering somewhat from their crushing defeat at Moore's Creek Bridge, were beginning to show signs of activity. In the summer of 1776, disaffection openly manifested itself in Guilford County; to General Rutherford's request for troops from the Hillsboro brigade for his expedition against the Cherokee, the Council of Safety returned a refusal be- cause of "the many disaffected persons in that district and neighborhood;" while in Surry County the Tories were ac-
4 Probably referring to Caswell's action in resigning his com- mission after the battle of Camden in resentment at the appoint- ment of General Smallwood of Maryland to the command of the North Carolina militia.
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tually in arms against the provisional government. The in- auguration of the new state government in April, 1777, was the signal for renewed activity on the part of the Loyalists. A Loyalist conspiracy in the Albemarle region was discov- ered just in time to prevent an uprising. About the same time "many evil persons" in Edgecombe and neighboring counties "joined in a most wicked conspiracy" against the new government. Disaffection was suppressed at the time, but continued to smoulder and two years later broke out again in a still more violent form. A large number of per- sons in Edgecombe, Nash, Johnston, and Dobbs counties en- tered into an association by which they "obligated them- selves to prevent the Militia from being drafted," to aid and protect deserters from the American army, and to resist the civil officers in the discharge of their duties. In the Cape Fear section, too, a militia officer reported to the governor that he "was alarmed by these dam rascals, the Tories," and Colonel John Ashe felt it advisable to take extraordinary precautions to prevent a descent upon Wilmington by the "Scotch Tories and others from Cross Creek and Bladen." In September, 1777, Governor Caswell wrote to Cornelius Harnett: "We have been alarmed with the rising of Tories and forming of conspiracies: the former among the High- landers and Regulators and in the county [Chowan] in which you had the honor to draw your first breath, and in Bertie and Martin." In the West the situation was quite as bad, perhaps worse than in the East. Officers of Anson reported "many disaffected persons in our County." Tryon County was a hotbed of Tories. In the spring of 1779 a noted Tory . leader, named John Moore, embodied 300 men in Tryon, forcibly prevented the execution of the draft, and spread terror throughout that region. Farther west, the conditions in Burke County might easily have been duplicated in Surry, Rowan, Guilford, and other western counties. In July, 1779, General Rutherford reported that bands of Tories were or- ganized in Burke "who publicly Rob all the Friends of Amer- ica ;" that "British Officers were actually recruiting in that County ;" and that the Tories openly boasted that "immedi- ately after harvest they were to take up Arms and put to death the principal Friends to the Cause and March off to the Enemy." Indeed, in every section, in every county, in al- most every neighborhood large numbers of the people were disaffected and only wanted a favorable opportunity to raise their hands against the new government.
The presence of the Tories not only menaced the peace
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of the State and the stability of the government, but also weakened the financial and military resources of the State. They refused to pay taxes or to contribute in any other way to the support of the government, and the civil authorities were compelled to use the militia for collecting the revenues of the State. An even more insidious and effective form of Loyalist propaganda was directed at the credit of the State. In 1779 Samuel Ashe, one of the judges of the Superior Court called the General Assembly's attention to the steady depreci- ation in the value of the State's bills of credit, adding, "nor can they without the immediate effectual interposi- tion of the legislature continue at their present stand against the constant endeavours of the mongrel Tory Traders and others among us to destroy their Credit." The Tories of- fered an equally effective opposition to recruiting, and at times actually took up arms to prevent the enforcement of the draft. The State, therefore, was compelled to hold in re- serve a considerable force for any emergency that might arise. The presence of these inveterate domestic enemies, there- fore, not only cost the State considerable sums of money sorely needed by both state and continental treasuries, but retained at home many regiments of fighting men who should have been with Washington and Greene.
The policy of the State with respect to the Loyalists was one of the first questions that came up for consideration. The Whigs at first were inclined to be conciliatory. Al- though many Tories had but recently been "in actual Arms. against the liberties of the United States of America," and in numerous other ways had given aid and comfort to the enemy, yet the Convention of 1776, hoping "that such Per- sons are now become sensible of the Wickedness and Folly" of their conduct, and eager to win for the new state govern- ment as much support as possible, determined to throw wide open the door of reconciliation. It therefore directed the governor to issue a proclamation offering free pardon to all who would take the oath of allegiance within ninety days. This generous offer the Loyalists seem to have interpreted as evidence of weakness in the new government and but few took advantage of it. Accordingly the Assembly at its first session entered upon a sterner policy. It adopted a test which held out to all the alternative of allegiance to the State or banishment. True to their principles most of those who were Loyalists from conviction accepted the latter choice and however much we may deprecate their mistaken judg- ment we cannot withhold onr admiration from men who pre-
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ferred exile to apostasy. Many of these exiles were people of wealth, intelligence and character. In July, 1777, a large vessel sailed from New Bern carrying "a great number of Tories," with their families, "mostly Gentlemen of Consid- erable Property." Among them was Martin Howard, last chief justice of North Carolina under the Crown. Many others departed from Bertie, Chowan, and Halifax coun- ties. Samuel Johnston testified that those who went from Chowan were "men of fair character and inoffensive in their conduct." The Scotch Highlanders departed in large num- bers. "Two-thirds of Cumberland County intend leaving this State," reported the colonel of the militia of that county in July, 1777. "Great Numbers of these infatuated and over- loyal People," said the North Carolina Gazette, in October, 1777, "returned from America to their own Country," among whom was Flora MacDonald. Others found new homes in Nova Scotia. Among the prominent Highlanders who left North Carolina in 1777 was John Hamilton, "a merchant of considerable note," who sailed from New Bern on a "Scotch transport, having on Board a Number of Gentlemen of that Nation." Hamilton afterwards organized these Highland- ers into a Loyalist regiment which on numerous battlefields in the South worthily maintained the high reputation of their race for its fighting qualities. This exodus of the Highland- ers from North Carolina in 1777 was comparable to their exodus from Scotland after Culloden. The policy which was responsible for it was perhaps the only course open to the new State; nevertheless one may be permitted to regret that circumstances compelled North Carolina to drive from her borders so many men and women of this strong, virile race.
As the war progressed feeling against the Tories grew more bitter. Trials for treason became frequent and the As- sembly entered upon more vigorous measures. In Novem- ber, 1777, it determined upon a policy of confiscation, and in January, 1779, passed the first of a long series of confisca- tion acts. A still more sweeping act was passed in October of that year. This act not only confiscated the property of Loyalists generally, but mentioned by name a long list of the more prominent members of that party among whom were William Tryon, Josiah Martin, Edward Brice Dobbs, Ed- mund Fanning, Henry Eustace McCulloh, and John Hamil- ton. Its provisions excited such strong opposition that fif- teen members of the House of Commons, under the lead of Willie Jones, entered a vigorous protest against it declar- ing that it involved "such a Complication of Blunders and
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betrays such ignorance in Legislation as would disgrace a Set of Drovers." Their objections were, first, that it vio- lated the conditions of the Treason Act of 1777 under which many Loyalists had left the State, and, second, that it re- pealed the provisions made in the Confiscation Act of Jan- uary, 1779, for "such unfortunate and Innocent Wives and Children resident in the State, who had been abandoned by their Fathers and Husbands, and also for aged parents in particular Cases." The harshness of the act, and the vigor with which it was enforced, reveal the intensity of the feeling which the Tories had aroused against themselves. North Carolina, therefore, was not prepared to accept grace- fully the clause in the Treaty of 1783 which stipulated that Congress should recommend to the several states the resti- tution of this confiscated property to its original owners. The State had not only received large sums from this source, but had guaranteed the title to the property sold under the confiscation acts upon which many of the purchasers had spent considerable sums. The treaty, therefore, was alarm- ing both to the State which had sold the property and to the hundreds of individuals who had bought it. However the delegates from North Carolina in the Continental Congress took pains to call the governor's attention to the fact that the provision was "but a promise of a recommendation," which the Assembly could comply with or not, and the Assem- bly thus re-assured treated it with silent contempt.
To the weakness of the executive, the intensity of party spirit, and the menace of the Tories, must be added a fourth cause of the failure of North Carolina to throw her full strength into the war for independence, i.e., the breakdown of her finances. The State entered upon its independent ca- reer with an empty treasury, without credit, and with no in- tercolonial or foreign commerce as a basis of credit. The necessities of the new government and the demands of war imposed upon the people financial burdens and responsibili- ties beyond anything they had ever experienced. If they did not solve their financial problems with the same wisdom and success with which they solved their political problems, they were not alone in their failure. No other state, nor the United States, obtained any better results.
The principal sources from which North Carolina derived her means for support of the war were issues of paper money, taxes, loans, and the proceeds of the sale of confiscated prop- erty. Paper money the people of North Carolina had been fa- miliar with from long experience and the Provincial Congress
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naturally resorted to it as the means for financing the war. In September, 1775, Congress issued $125,000, and in May, 1776, $1,000,000, in bills of credit. To maintain their value and provide for their redemption the faith of the province was pledged and a poll tax levied to begin, for the redemp- tion of the first issue, in 1777 and to run for nine years, for the redemption of the second, in 1780 and to run for twenty years. The delay in the levy and collection of these taxes and the uncertainty as to the sums they would ultimately yield had a bad effect on the credit of the province. This fact cou- pled with the sudden expansion of the currency, the counter- feits with which the colony was immediately flooded, and the effect of the unfavorable comparisons which the Tories were at pains to make between the bills of the Provincial Congress and those issued under authority of the British government, resulted in rapid depreciation. The General Assembly, there- fore, thought it advisable to retire both these issues, and in August, 1778, passed an act issuing $2,125,000 of new bills, making them a legal tender, and directing that $1,575,000 be used to redeem the old bills. But this mandate was not car- ried into effect because as the demands upon the treasury in- creased from year to year, the Assembly postponed the date at which the old bills were to be redeemed. The old bills, therefore, remained in circulation, but the failure of the Assembly to keep faith with their holders by refusing either to redeem them or to levy and collect the taxes promised for their redemption, had an unfortunate effect upon their value, as also upon the credit of the State. As the war progressed other issues of paper currency became necessary. In 1779 $1,250,000, in 1780, $3,100,000, and in 1783, $250,000 were emitted. All of these bills were made a legal tender, but except in case of the last no tax was levied for their redemp- tion.
In spite of every effort to sustain the value of the cur- rency depreciation set in early and progressed rapidly. In December, 1778, the decline in value was about 5, per cent ; a year later it was 30 per cent. In January, 1779, Samuel Ashe declared in a communication to the General Assembly, "that the great depreciation of our Bills of Credit and the rapid and extravagant rise in price of every necessary arti- cle," made it impossible for him to live on his salary. "The Depreciation of our Bills," he said, "is a matter of such no- toriety that every one knows and feels it. Their value at this time bears not the proportion of twelve to one of their original value." The rapidity with which depreciation pro-
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gressed may be seen by comparing Ashe's statement with the prices quoted by Richard Cogdell of New Bern in August, 1780. "Corn," he wrote, "[is] £100 per Bble., Meal £20 per bushel, Beef £48 per pound, Mutton £4 per lb., and every thing in proportion. A String of Fish which used to cost 12d is now 1920d, or 20 Dollars. What a horrible prospect this exhibits!" But the worst was not yet. By the close of the year the Assembly itself was compelled by law to rec- ognize a depreciation in its currency of 800 per cent.
As early as 1777, the General Assembly began to realize that it could not carry on the government indefinitely on a paper currency and that it must sooner or later resort to taxation. Although convinced of its necessity, the legisla- ture approached this policy reluctantly and entered upon it timidly. No ad valorem tax had ever been levied in North Carolina, and what the effect of such a tax would be, no man could tell. But it had to come, and at the April session, 1777, the Assembly directed that a general assessment be made of all property in the State, levied upon it a tax of half-penny in the pound, and provided machinery for its col- lection. This act fixed the future policy of the State. As the expenses of the war increased and the currency depreciated, the Assembly gradually increased the rate of taxation, but the yield from this source was never very large. In 1786 after eleven years of trial the estimated receipts from taxa- tion were less than £65,000. Loose methods of assessment, inefficiency of administration, and corruption among officials consumed a large per cent of the revenues: In 1781 Governor Burke discussed these matters at length in his annual mes- sage, urged the Assembly "to provide effectually for calling to speedy account and payment all public collectors and other accountants," and declared that "the numberless hands at present employed in the collecting of the public revenues ex- haust much of the product and create perplexities and diffi- culties without and in the public accounts."
In 1780 the tide of war rolled back once more upon the South. Georgia and South Carolina were quickly overrun by the enemy, who then threatened North Carolina with im- mediate invasion. An army of defense had to be immedi- ately raised, equipped and supplied. But Governor Nash informed the General Assembly that the treasury was empty and the financial resources of the State exhausted. How to obtain means of supplying the army was accordingly an urgent problem. The Assembly had found that the continued emission of paper money had a "tendency to increase the Vol. I-28
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prices of necessaries" which was "greatly injurious to the public." No relief could be expected from taxation. "The public money is unaccounted for," Governor Burke told the Assembly, "the taxes uncollected or unproductive, * *
* and the Treasury totally unable to make payment." Even had the State had the money, the high prices of all necessities would have been practically prohibitory. In this emergency, therefore, the Assembly hit upon two new methods of supply- ing the public needs, i. e., a specific tax and loans. The for- mer payable in Indian corn, wheat, flour, oats, rye, rice, pork and beef, was continued through 1782. Warehouses were es- tablished and stored with supplies which were distributed to the army. The system was primitive, cumbersome and waste- ful, yet it is difficult to see how the army could have been sup- plied without it. But some money was absolutely necessary. In September, 1780, therefore, the Assembly determined upon a system of loans. The treasurers were authorized to issue loan certificates bearing interest at 5 per cent and exempt from all taxation, and to appeal to the people to lend the State money on them. The same act levied a tax "equal to double the amount of the public tax," i. e., 12 pence in the pound, for the redemption of these certificates when due. Another source of revenue was the confiscated property of the Loyalists which in 1783 was pledged to redeem the issue of $250,000 of bills of credit, authorized for the payment of the dues to soldiers.
North Carolina's failure to meet her financial obligations to the Confederacy was even more conspicuous than her fail- ure to meet her own obligations. In this respect, however, the State was not peculiar since the same statement may be made of all the states. At the beginning of the struggle the rule was adopted that the states should meet all expenses incurred for purely state purposes, but those incurred in the common cause should be met out of a common or continental treasury. The chief sources from which the continental treas- ury drew its revenues were bills of credit, domestic loans, for- eign loans, and requisitions on the states. During the war the Continental Congress issued bills of credit to the amount of $242,000,000, which it apportioned among the states for re- demption on a basis of population. The several states pledged their faith to redeem this currency, but none kept its pledge, and the continental currency having no other basis of value depreciated even more rapidly than the state currency. To say that anything was "not worth a continental" became a common expression for describing its utter worthlessness.
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In 1776 Congress decided to supplement its bills of credit with loan certificates and accordingly established loan of- fices for soliciting loans for which it issued certificates bear- ing at first 4 per cent interest, later 6 per cent. By 1783, $65,000,000 had been raised in this way of which North Caro- lina had contributed but $1,200,000, an amount below the State's proportion whether estimated on a basis of wealth or of population. After the consummation of the alliance with France in 1778 foreign loans became the principal item in continental finances, and from 1779 to the close of the war interest on these loans constituted one of the most pressing demands upon the Continental Treasury. Congress having no power of taxation was compelled to look to the states to supply the funds to meet these demands, and it looked in vain.
The case of North Carolina was but typical; from 1781 to 1784 the State was too exhausted financially to make any contribution toward the payment of the interest on the pub- lic debt. For the same reason the State fell badly behind in its general contributions to the support of the war. Con- gress had adopted population as the basis for its requisi- tions on the states both for men and money, and while this was not quite fair for the southern states with their large negro population, yet they had readily accepted it. The North Carolina Congress of August, 1775, had unanimously pledged the full support of the colony to the continental cause on this basis, but as the war progressed and its burdens in- creased, the State found itself increasingly unable to redeem this pledge. In August, 1781, it was indebted to the Con- tinental Treasury $18,230,000; while at the beginning of 1784 three other requisitions had been made on which the State had paid nothing. But here again North Carolina's case was not peculiar, for none of the states had met their quotas. From November 22, 1777, to October 6, 1779, for instance, there were four requisitions on the states calling for $95,000,- 000 in paper money, on which the payments amounted to less than $55,000,000; while three specie requisitions from August 26, 1780, to March 16, 1781, amounting to more than $10,000,- 000, yielded but little more than $1,500,000. The basis of assessment was obviously inequitable, and each state was so afraid that it would contribute more than its just share that it took pains to contribute less.
With all these obstacles and difficulties, and numerous others scarcely less serious, how was it possible for the "men of '76" to carry their cause through to its final triumph?
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The answer to this question is certainly to be found in the reality of the existence of those intangible and spiritual forces which so many modern historians, recognizing only material forces in shaping the affairs of mankind, refuse to consider as proper subjects for historical notice. Devotion and loyalty to their ideals, confidence in the justice of their cause, and faith in its ultimate triumph were quite as real to the Revolutionary patriots as were the material obstacles with which they had to deal, and it was the reality of these spiritual forces that enabled them to overcome difficulties, to endure sacrifices and hardships, to rise superior to disaster, and to wring victory out of defeat. No man not a profes- sional cynic can read the public or private correspondence of the public men of that time without feeling the truth and justice of these observations. Had North Carolina been able to set up an efficient government, had all her people been in "a perfect good agreement," had there been no vigilant do- mestic foe nestling in lier bosom, had she enjoyed a substan- tial financial credit, the task of her leaders would have been far easier and simpler, but it would not have called forth that daring in action, that constancy in good and in ill for- tune, that fortitude in suffering, that faith which shown brightest in the darkness of defeat which entitles them to the admiration and gratitude of all succeeding generations. "While every community and section of the State was more or less divided in sentiment, it is to the honor of the public men of that period that no representative of the people, no man who had been honored with their confidence flinched when the test came or failed to move steadily forward through the gloom and obscurity of the doubtful and hazardous issue." 5
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