“An Essay on Currency” was written in August 1732 and published in 1734. The only known information about its publication is who published it, Lewis Timothy. During this time Timothy had recently brought back the South Carolina Gazette, so he may have published it in there as a multi-part article. An essay this lengthy, published seemingly anonymously, shows how tense the currency debate was at the time. This person wanted people to hear his argument—he clearly lays his intentions for writing this and welcomes critiques—but his name is nowhere to be found on the document. Even with no author attached there is plenty in this document to take interest in.
To start there is a great amount of cultural detail that can be gleaned from reading this piece. The author lays out several of the contemporary problems that can be solved through the fully supported adoption of paper money. The anonymous author organizes his argument very logically and writes fluently. He starts his essay by dismissing the old way of trade, the barter system. Pointing out flaws in the barter system is not difficult to do, and he spends very little time doing so. Afterwards he tackles a more pressing issue: why not just use gold and silver as substitutes in trade? He continues in this fashion, tackling each counter-point for paper money in turn, even attempting to establish how he thinks a paper money system would work, and how it would be supported in the colony. Each of these steps that he feels obliged to go through shows what he must have thought were the contemporary issues against the use of paper money, thus shining a little more light onto the culture of a long gone time period.
It is easy to understand why paper money became the standard—easier to use, possible to generate more to meet demand, set value. What is not so clear is how it came to be. Initially the bills were issued as bills of credit. South Carolina’s first issue of paper money occurred through the act of Assembly, May 8, 1703, where 6,000 pounds in bills of credit were manufactured. Of course this was a low estimate so more was printed almost immediately. The colonies that choose to use paper money had a careful balance to strike. British money was still necessary to pay off any taxes and formal transactions with the crown, and England was very wary of the colonies becoming economically independent with their own form of currency. The most heavily debated factor for the issue of paper money was deciding on an amount. South Carolina in particular faced heavy periods of shortage and surplus in their money supply. It took a Board of Trade sponsored ruling in 1730 for the use and circulation of paper money to die down as a hot political topic. Only then did paper money become a permanent part of the colony that could maintain a steady value. This was a great benefit to the Carolina colony; since Charleston was a great port city, having a reliable currency was paramount for good trade. Once the currency problem was finally solved the South Carolina colony became known as a very rich area, with a higher per-capita income and more wealth than any other of the North American colonies.
So it is easy to see why a document like “An Essay on Currency” is important today; the use of paper currency was a big concern during the colonial era for South Carolina, one they needed to solve quickly for the monetary benefit of all. The only editing that was done to the transcription below was a normalization of spellings, specifically in the case of printer F’s that stand in for S’s, they have been changed to S to aid reading. I have also kept all capitalization present in the original document.
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An Essay on Currency
That the unsettled State of the Currency has been the Occasion of great Inconveniency to this Province, and was once within View of its Ruine, I believe there are but few disinterested Men that will deny: And I conceive the Paper-Money at this time is very far from being on so good an Establishment as it might be, and that some Persons are so far from wanting it to be put on a better Footing, that they had rather it were all destroy’d. I shall therefore endeavour to shew, that there is a Necessity for some Currency, and that that Currency, by the Nature of our Trade, cannot be Silver or Gold: That Paper-Money will answer all the Ends, that any ot’er Money will, for a Medium of Trade. And then I shall propose a Method for establishing it on a firm and lasting Foundation; and examine the Consequences thereof to this Province, and the Effects it may have on the Trade of Great Britain.
If any should say that we have no necessity for Currency at all, but that our Trade may as well be carried on by Barter: To him I answer, He that has well considered the Inconveniencies that attend that Method, I am of Opinion, will not be fond of it long.
By Barter you can neither sell, nor buy, but once a Year, except from the Stores, that are up and down the Country, and you must be at their Mercy, not only for the prices of their Goods, but of your own too: And they will generally get more be sending them from the Ship to the Store, than the Merchant in England gets by transporting them from England hither.
Besides we have several Instances, that the Country-Stores have left many Families, which had several Negroes, without scarce a Negro to help them. And I believe had it not been for an extraordinary Occurence, it had much worse.
Again, a Barter-Trade doth, I concieve, tend to the Ruine of all the Towns in the Province; and the People will live scatter’d about; only with a few Trading-Houses amongst them, to the great Discouragement of foreign Trade, and the great perplexity and Inconveniency of the Trader.
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Now I shall endeavor to shew, that by the Nature of our Trade, this Currency cannot be Silver or Gold. For supposing we now had a sufficient Quantity of Gold and Silver for a Medium of Trade, our Trade is such, that the British Ships always do or can bring in more in Value of the British Commodities, than their Ships will carry back in our Produce. Now this Overplus, or the Ballance of the Account, the Trader, when his Ship is loaded with our Produce, will carry away in our Money, this would soon drain us of all our Money, unless we had Mines, or some Trade, the Returns whereof, in Silver, would be answerable to the Ballance of our Trade with England, which we have not.
There is another Reason, why Silver will never remain here long, which is, that the Trader will always carry away our Money, instead of our Produce, whensoever Money will answer his Ends better in Europe, and leave our Produce to perish on our Hands, to the great Detriment both of England and this Province, as I shall endeavour to shew hereafter; and this cannot be prevented by Law, no, altho’ you should make it Death.
But it may be said, that formerly Silver was very plenty here. I answer thereto, the Trade then of this Province was very inconsiderable, to what it is now, and the Returns then made to Europe, were chiefly in Skins, which Skins were then of great Value, and a Ship would carry a great Quantity of them. Also the Privateers brought in great Quantities of Spanish Silver, and we likewise sent a considerable Quantity of Beef, Pork, and Pease to the Islands, which brought us in, besides what we wanted of their Produce, a great Deal of Silver; so it is no wonder that Silver was then plenty here: But this is all ceased, and not to be expected again. And now if we will have any Currency, we must look some other way; and I think we cannot find a better than our Paper-Bills, as being a Currency, which will never be carried away from us, and prevent the Inconveniences that will follow from the coming and going of our Currency, for the Ease and Advantage both of Buyer and Seller, of the Foreign and I comstock Trader. For this you may buy, whatever can be got for any Money in this Province; nay, even Gold and Silver it self.
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In 1712, or 1713 there were 52,000 Pounds made, and let out on Interest, which was of vast Advantage to many Men, and of great Use to the Country; and Rice and Pitch continued, until the Indian War, not to exceed 22 s. 6d. the highest, notwithstanding great Quantities of both those Commodities began to be then made. In the Year 1715 began the Indian War, which was the greatest Calamity that ever happened, not only to the Country, but to our Bills also. For the Indians now rising up in Arms against us on every side, put the Country into such a Consternation, that the Thoughts of a great many were more, how they should secure somewhat in some other place, and to get away if they could, than to stay here to defend the Country. And many persons, nay even from Charles-Town, who could not get themselves; sent their Wives and Families off to the Northern Colonies. So that those who had Paper-Bills in their Hands, would give any Price either for Silver or Gold, or our Produce, to send with their Families to provide for them, and to settle them in some other place, if they should be forc’d to leave this Province. By this means our Bills were so much depreciated in their Value, that they were not worth above the one fourth part of what they had been.