The necessity of good faith in contracts, and the support of commerce, oblige the legislator to secure for the creditors the persons of bankrupts. It is, however, necessary to distinguish between the fraudulent and the honest bankrupt. The fraudulent bankrupt should be punished in the same manner with him who adulterates the coin; for, to falsify a piece of coin, which is a pledge of the mutual obligations between citizens, is not a greater crime than to violate the obligations themselves. But the bankrupt who, after a strict examination, has proved before proper judges, that either the fraud or losses of others, or misfortunes unavoidable by human prudence, have stripped him of his substance, upon what barbarous pretence is he thrown into prison, and thus deprived of the only remaining good, the melancholy enjoyment of mere liberty? Why is he ranked with criminals, and in despair compelled to repent of his honesty? Conscious of his innocence, he lived easy and happy under the protection of those laws which, it is true, he violated, but not intentionally; laws dictated by the avarice of the rich, and accepted by the poor, seduced by that universal and flattering hope, which makes men believe that all unlucky accidents are the lot of others, and the most fortunate only their share. Mankind, when influenced by the first impressions, love cruel laws, although, being subject to them themselves, it is the interest of every person that they should be as mild as possible; but the fear of being injured is always more prevalent than the intention of injuring others.
But, to return to the honest bankrupt: let his debt, if you will, not be considered as cancelled, till the payment of the whole; let him be refused the liberty of leaving the country without leave of his creditors, or of carrying into another nation that industry which, under a penalty, he should be obliged to employ for their benefit; but what pretence can justify the depriving an innocent though unfortunate man of his liberty, without the least utility to his creditors?
But, say they, the hardships of confinement will induce him to discover his fraudulent transactions; an event that can hardly be supposed, after a rigorous examination of his conduct and affairs. But if they are not discovered, he will escape unpunished. It is, I think, a maxim of government, that the importance of the political inconveniencies arising from the impunity of a crime, are directly as the injury to the public, and inversely as the difficulty of proof.
It will be necessary to distinguish fraud, attended with aggravating circumstances, from simple fraud, and that from perfect innocence. For the first, let there be ordained the same punishment as for forgery; for the second a less punishment, but with the loss of liberty; and if perfectly honest, let the bankrupt himself choose the method of re-establishing himself, and of satisfying his creditors; or, if he should appear not to have been strictly honest, let that be determined by his creditors; but these distinctions should be fixed by the laws, which alone are impartial, and not by the arbitrary and dangerous prudence of judges.
With what ease might a sagacious legislator prevent the greatest part of fraudulent bankruptcies, and remedy the misfortunes that befall the honest and industrious! A public register of all contracts, with the liberty of consulting it allowed to every citizen: a public fund, formed by a contribution of the opulent merchants, for the timely assistance of unfortunate industry, were establishments that could produce no real inconveniencies, and many advantages. But, unhappily, the most simple, the easiest, yet the wisest laws, that wait only for the nod of the legislator, to diffuse through nations wealth, power, and felicity, laws which would be regarded by future generations with eternal gratitude, are either unknown or rejected. A restless and trifling spirit, the timid prudence of the present moment, a distrust and aversion to the most useful novelties, possess the minds of those who are empowered to regulate the actions of mankind.
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