... "Sir, we never need be, and I am persuaded never shall be, taxed as the English are. A very great portion of their permanent burdens arises from the interest of a debt which the government most unwisely suffered to accumulate almost a century, without one serious effort or systematic plan for its reduction. Her present minister, at the commencement of his administration in 1783, established a permanent sinking fund, which now produces very great effects; he also introduced a maxim of infinite importance in finance which he has steadily adhered to, that whenever a new loan is made the means shall be provided not only of paying the interest but of effecting a gradual extinction of the principal. Had these two ideas been adopted and practised upon at the beginning of the century which we have just seen close, England might have expended as much money as she has expended and not owed at this moment a shilling of debt, except that contracted in the present war. These ideas, profiting by the example of England, we have adopted and are now practising on. We have provided a fund which is now in constant operation for the extinguishment of our debt. This fund will extinguish the foreign debt in nine years from now, and the six per cent., a large part of our domestic debt, in eighteen years. I trust we shall adhere to this plan, and whenever we are compelled by the exigency of our affairs to make a loan, by providing also for its timely extinguishment, we may always avoid an inconvenient or burdensome accumulation of debt. We may gather all the roses of the funding system without its thorns." This was the theory of the English financiers, of William Pitt and his scholars, which held possession of the English exchequer throughout the French war and was only exploded in 1813 by a pamphlet written by a Scotchman named Hamilton.[47] Mr. Gallatin, however, was never its dupe. He answered Mr. Harper on the spot; and short as his reply was, it gave in perfectly clear language the substance of all that fourteen years later was supposed to be a new discovery in English finance: