Whether the financiering of the American Revolution is to be looked upon in a pathetic or in a comical light must depend upon the mood of the observer. The spectacle of a young people, with no accumulated capital, engaged in supporting the charge of a mortal struggle against all the vast resources of Britain, has in it something of pathos. But the methods to which this people resorted to raise funds were certainly of amusing simplicity. It was not until the appointment of Robert Morris, in 1781, that a treasury department came into existence and some slight pretense of system was introduced into the financial affairs of the confederation. During the years prior to that time Congress managed the business matters. But Congress neither had funds nor the power to obtain any. It had an unlimited power for contracting debts: absolutely no power for collecting money. It used the former power freely. When creditors wanted payment, requisitions were made upon the States for their respective quotas. But the States were found to be sadly irresponsive; probably the citizens really had not much ready money; certainly they had not enough to pay in taxes the cost of the war; no civilized state has been able to conduct a war, even a small one, in modern times without using the national credit. But the United States had absolutely no credit at all. It was well enough to exclaim "Millions for defense; but not one cent for tribute!" This was rhetoric, not business; and Congress soon found that the driblets which trickled tardily to them in response to their demands on the several States would hardly moisten the bottom of the great exchequer tank, which needed to be filled to the brim.
Two methods of relief were then adopted, crude, simple, but likely for a time to be efficient; and provided only that within that time the war could be finished, all might go well. One of these methods was to issue irredeemable paper "money;" the other was to borrow real money abroad. The droll part was that both these transactions were audaciously entered upon by a body which had absolutely no revenues at all to pledge as security, which had not a dollar of property, nor authority to compel any living man to pay it a dollar. A more utterly irresponsible debtor than Congress never asked for a loan or offered a promissory note. For the security of a creditor there was only the moral probability that in case of success the people would be honest enough to pay their debts; and there was much danger that the jealousies between the States as to their proportionate quotas might stimulate reluctance and furnish excuses which might easily become serious in so unpleasant a matter as paying out hard cash. At home Congress could manage to make its paper money percolate among the people, and could pay a good many American creditors with it; but there were some who would not be thus satisfied, and few European creditors, of course, would meddle with such currency. So to pay these people who would have real money Congress solicited loans from other nations. It was like the financiering of a schoolboy, who issues his IOU's among his mates, and refers the exacting and business-like tradesman to his father. France was cast for the rôle of father to the congressional schoolboy for many wearisome years.