George III, William Pitt was turned out of office, the king treating him
with "gross incivility" and the crowds shouting "Pitt forever!" The
direction of affairs was entrusted to men enjoying the king's
confidence. Leadership in the House of Commons fell to George Grenville,
a grave and laborious man who for years had groaned over the increasing
cost of government.

The first task after the conclusion of peace in 1763 was the adjustment
of the disordered finances of the kingdom. The debt stood at the highest
point in the history of the country. More revenue was absolutely
necessary and Grenville began to search for it, turning his attention
finally to the American colonies. In this quest he had the aid of a
zealous colleague, Charles Townshend, who had long been in public
service and was familiar with the difficulties encountered by royal
governors in America. These two men, with the support of the entire
ministry, inaugurated in February, 1763, "a new system of colonial
government. It was announced by authority that there were to be no more
requisitions from the king to the colonial assemblies for supplies, but
that the colonies were to be taxed instead by act of Parliament.
Colonial governors and judges were to be paid by the Crown; they were to
be supported by a standing army of twenty regiments; and all the
expenses of this force were to be met by parliamentary taxation."

=Restriction of Paper Money (1763).=--Among the many complaints filed
before the board of trade were vigorous protests against the issuance of
paper money by the colonial legislatures. The new ministry provided a
remedy in the act of 1763, which declared void all colonial laws
authorizing paper money or extending the life of outstanding bills. This
law was aimed at the "cheap money" which the Americans were fond of
making when specie was scarce--money which they tried to force on their