Editing Second Continental Congress (section)

== Financing the Revolution ==

The Congress's greatest challenge throughout the war was financing military operations without the power to tax. The Continental Congress issued paper currency beginning in 1775, pledging that the states would redeem the notes through future taxation. As the war continued and the money supply expanded, the value of Continental currency plummeted—giving rise to the phrase "not worth a Continental." By 1780, Continental dollars had depreciated to roughly one-fortieth of their face value, devastating soldiers and creditors who had accepted payment in the currency. The financial crisis prompted Congress to requisition specific supplies from the states rather than money, a system that proved only marginally more effective.<ref name="ferguson">{{cite book |last=Ferguson |first=E. James |title=The Power of the Purse: A History of American Public Finance, 1776-1790 |year=1961 |publisher=University of North Carolina Press |location=Chapel Hill}}</ref>

Foreign loans, primarily from France, helped sustain the revolutionary effort. Benjamin Franklin, serving as American minister to France, secured crucial financial support and eventually the military alliance that proved decisive in the war. Dutch bankers also provided loans, attracted by American prospects despite the risks. These foreign debts, along with domestic obligations, would burden the new nation for years after independence, contributing to the financial difficulties that eventually prompted the [[Constitutional Convention]]. The Congress's inability to meet its financial obligations undermined its authority and provided powerful arguments for strengthening the national government under the Constitution.<ref name="ferling"/>