ONE:The year 1797 was opened by the suspension of cash payments. The Bank of England had repeatedly represented to Pitt, as Chancellor of the Exchequer, that his enormous demands upon it for specie, as well as paper money, had nearly exhausted its coffers and could not long be continued. The payment of our armies abroad, and the advances to foreign kings, were necessarily made[455] in cash. The Government, in spite of enormous taxation, had already overdrawn its account eleven million six hundred and sixty-eight thousand eight hundred pounds, and the sole balance in the hands of the Bank was reduced to three million eight hundred and twenty-six thousand eight hundred and ninety pounds. Pitt was demanding a fresh loan for Ireland, when a message came from the Bank to say that, in existing circumstances, it could not be complied with. Thus suddenly pulled up, the Privy Council was summoned, and it was concluded to issue an order for stopping all further issue of cash, except to the Government, and except one hundred thousand pounds for the accommodation of private bankers and traders. Paper money was made a legal tender to all other parties, and the Bank was empowered to issue small notes for the accommodation of the public instead of guineas. A Bill was passed for the purpose, and that it might not be considered more than a temporary measure, it was made operative only till June; but it was renewed from time to time by fresh Acts of Parliament. The system was not abolished again till 1819, when Sir Robert Peel brought in his Bill for the resumption of cash payments, and during the whole of that time the depreciation of paper money was comparatively slight.Whilst Cornwallis was pursuing Washington through the Jerseys, Clinton swept Rhode Island of the American troops, and drove Commodore Hopkins with some ships up Providence River, where he remained. Rhode Island, however, required a strong body of English soldiers constantly to defend it. Meanwhile Sir Guy Carleton, having destroyed the American flotilla on Lake Champlain, was daily expected to march from Crown Point and invest Ticonderoga, which was only fifteen miles distant, and where Schuyler lay prepared to abandon it on the approach of the English. But Carleton, who had displayed so much activity and energy, now, like the rest of our generals, seemed at once to abandon them at the decisive point. He descended the Champlain to Isle-aux-Noix, put his forces into winter quarters there, and proceeded himself to Quebec, to prepare for the next campaign. Thus ended the campaign of 1776.

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