Reviewed by Toby L. Ditz | Book Review | The William and Mary Quarterly, 63.3

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Reviewed by Toby L. Ditz | Book Review | The William and Mary Quarterly, 63.3 | The History Cooperative

Reviews of Books

Toby L. Ditz, Johns Hopkins University

Securing the Commonwealth: Debt, Speculation, and Writing in the Making of Early America. By Jennifer J. Baker. Baltimore, Md.: Johns Hopkins University Press, 2005. 230 pages. $50.00 (cloth).
This smart, engaging book uses the topic of paper money and bank notes to revisit the larger subject of "theories about risk taking, debt, and credit" (1) as it emerges in a wide range of writing from the 1690s through the end of the eighteenth century. Each of its six chapters features texts by at least one canonical author, among them several books and pamphlets by Cotton Mather, Benjamin Franklin's Autobiography (1793), Royall Tyler's play The Contrast (1790), Charles Brockden Brown's novel Arthur Mervyn (1799–1800), and Judith Sargent Murray's The Gleaner series (1798). Jennifer J. Baker, a literary critic, has a capacious understanding of what constituted literature in the eighteenth century: she supplements her interpretations of these and other major authors with coverage of an astonishingly large constellation of writers who worked in various print genres and print media. In accord with her pronounced contextual bent, Baker also grounds her readings in succinct, authoritative summaries of technical matters concerning paper currency and its depreciation, the retirement of public debt, and the establishment of state and national banks.	1
Baker explores several key themes as they emerge in this literature. Its advocates began to argue early in the eighteenth century that paper money was economically productive because it supplied a convenient measure of commodity value in specie-short colonial settings. Several Chesapeake authors who promoted greater economic diversification favored paper currency on these grounds, for example. Because emissions of paper bills were a form of public borrowing, this view that paper money was economically productive adumbrated later Hamiltonian arguments that public debt could be a boon to the national economy. Baker also argues that some writers who contemplated the complex social interdependencies created by chains of credit came to value debt, including public debt, as a source of social and political cohesion. Some, like Brown and Murray, even argued that the shared experience of marketplace risk and debt-related vulnerability could directly stimulate sympathy and compassion.	2
The positive qualities of mind held to accompany borrowing and lending is possibly the book's most intriguing theme. Writers gradually developed an enhanced capacity to think in terms of probabilistic outcomes and to embrace the risks that accompanied reliance on uncertain future events. Daniel Defoe, Franklin, and others began, for example, to distinguish between reckless and useful "speculations"; they conceptualized the latter as constructive economic "projections" (48) about likely outcomes based on sound empirical extrapolation from experience. In particular investing and borrowing was predicated, they argued, on the rationally founded belief (not certainty) that debtors would be able at a future date to perform their promises. Good borrowers and the lenders who found them trustworthy had sound reasons for holding that they would be able to augment their wealth: hence it was reasonable to promise to pay later for what one could not now afford. By the end of the century, some writers proposed the closely related idea that a credible promise to repay loans, whether made by individuals or governments, need not be fully backed by current assets and that, if judiciously managed, permanent debt was actually economically desirable.	. . .

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