Chapter 5

The expedition, which sailed from Cadiz the 28th ultimo, consisting of twelve sail of the line, besides frigates, and eleven thousand five hundred men, proceeds to the Windward Islands, and there joins M. de Guichen, or goes against Jamaica or the Floridas, as circumstances may render it proper. Another expedition from France, follows M. Ternay's, I believe, to reinforce M. de Guichen, who, if I am not deceived, will join the Spaniards to the leeward in the hurricane months, and if necessary and practicable, send eight or ten ships to our coasts in the beginning of the autumn. This depends, however, much on the events of war. Spain in concurrence with France, will have between forty and fifty sail of the line, to oppose the grand English fleet, which I am informed will sail the last of this month or the beginning of next. The allied fleet is not in such readiness. Strong interest is making for the Count d'Estaing to command in chief, and I think he will be nominated.

A very little time will determine the fate of the bills drawn on Mr Jay. I received the first last week, in a letter from M. Nesbitt of L'Orient who very prudently did not negotiate it, until he consulted me on the subject. I am also informed, that bills on Mr Laurens are in circulation, and we have not yet heard of his arrival. I have written to Dr Franklin, and Messrs Adams and Dana, and if I have not heard from them oftener, I impute it to the miscarriage of their letters, which was the case of those of Dr Franklin, the first two months after my arrival at Madrid. Mr Jay will transmit an account of the revenues, and expenses of Spain, with which I have furnished him, which will show, that Congress cannot depend on such pecuniary assistance from this nation as they expected.

Mr Jay's situation has been particularly disagreeable; the sum allotted by Congress, by no means accords with his necessary expenses, even if he received his salary as it became due. I do not complain, although I have been obliged since my departure from America to expend more than six hundred and fifty pounds sterling, and have not as yet received more than two hundred pounds of my salary. Almost everything that passes, even in Congress, is known here, either by intercepted letters, or otherwise. You, Gentlemen, will conceive, how delicate Mr Jay's situation must be, if he delivers faithfully his sentiments of men and measures. I must repeat again, however, that there is a great appearance of candor and good faith. The Count de Florida Blanca, and M. Galvez speak with much apparent civility and frankness, and seem desirous of doing all that is possible to succor us consistent with the actual situation of their finances, the former particularly. I have sent a copy of this via Bilboa, and another from Cadiz. I have not yet had the pleasure of receiving one letter from any one member of Congress.

I have the honor to be, &c.

WILLIAM CARMICHAEL.

FOOTNOTES:

[6] See this Memorial in _John Jay's Correspondence_, Vol. VII. p. 268.

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TO THE COMMITTEE OF FOREIGN AFFAIRS.

Madrid, July 17th, 1780.

Gentlemen,

Since writing the preceding letter, bills to the amount of about fifteen thousand dollars have been presented, and at a time when the news of our misfortune at Charleston made an impression much to our disadvantage. These bills however are accepted, and the Count de Florida Blanca appears to interest himself more than ever in contributing to aid us, repeating in the strongest manner his Catholic Majesty's favorable intentions. What he hinted at with respect to the attempts of the enemy, to thwart Mr Jay's negotiations has proved true. A Mr Cumberland, Secretary to Lord George Germain, has obtained permission to come to Madrid, and is actually here at present. But as his Excellency has promised to communicate his proposals, whatever they may be, on the subject of an accommodation, we cannot entertain a doubt, but that he will do it with the same frankness, with which he made known to us those of Sir John Dalrymple. The Count de Montmorin, Ambassador for France here, is not the least alarmed by the reception of this gentleman, and that Court is full as much interested as we are in the object for which he is sent. Mr Jay will transmit to Congress a narrative, which I have given him, of this gentleman's motions.

We have likewise received an account of the death of M. Miralles. He will soon have a successor, by whom we shall write more fully, and I hope more to the satisfaction of Congress. Nothing can hurt us here, or in Europe, so long as we are united, firm, and vigorous. I experienced at first a little coldness from the foreign Ministers at this Court, after the news of the surrender of Charleston, but that is worn off.

The public papers will announce the disturbances, which have lately arisen at London; all is at present quiet in that quarter, and government seems to have acquired fresh confidence and vigor. The Count d'Estaing is expected at St Ildefonso the 1st of next month, to go from thence to take the command of the united fleets, which will consist of thirtysix sail of the line, from Cadiz, including the French from Toulon, and other French ports, and twelve or fifteen from Brest. The last advices import that the English squadron amounted to twentyeight, chiefly capital ships; they left port about the 20th ult. The rest of Europe is in the same situation that I have already mentioned.

Since writing my letter of the 28th of May, I received a letter from the Baron de Schulenburg,[7] of which the enclosed is a copy, in answer to a civil letter, which I wrote him on my arrival here, representing the situation of our affairs in a favorable light. I daily expect another letter from him more particular, in consequence of an address, which I have transmitted to him, by which he may write to me in safety. I have cultivated the friendship of the foreign Ministers and their Secretaries as often as I have had occasion, and as I have always avoided an appearance of prejudice, I flatter myself, that I have been listened to with attention. My conduct has been the same with those of this nation with whom I have found means to be acquainted, and I doubt not, with time and patience, we shall ultimately succeed. I cannot speak too highly of the conduct of the Count de Montmorin, personally or politically. M. Gerard in his letters to me, expresses the same attachment as ever to our cause, and his late acquisition of dignity and consequence, puts it more in his power to be useful to us. As yet, Mr Jay has received but one letter from Congress, which conveyed their resolves respecting the bills of exchange drawn on him. I beg leave to acknowledge the receipt of a letter from Mr Houston last week, which I shall answer, if possible, by this opportunity.

I have the honor to be, &c.

WILLIAM CARMICHAEL.

FOOTNOTES:

[7] Missing.

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TO THE COMMITTEE OF FOREIGN AFFAIRS.

St Ildefonso, August 22d, 1780.

Gentlemen,

In the course of this month I did myself the honor of writing to you by the General Pickering from Bilboa, and the Captain Kyan from Cadiz, as also via France. In these letters I informed you of the situation of our affairs here, and of that of Europe in general; since which, we have advanced very little. The Minister had informed Mr Jay, on the 5th of July, that he had sent for a person to succeed M. Miralles, and that on his arrival, arrangements would be made with respect to the bills presented to Mr Jay for payment, and that he would then enter into discussions on the other objects of Mr Jay's mission. Before and since that period, bills to the amount of thirty thousand dollars have been presented, of which Mr Jay has accepted for fourteen thousand, by the direction of the Minister, and none of the others have as yet been protested.

You will see by a state of the finances of this country, which in compliance with Mr Jay's instructions to me, at my departure from Cadiz, I have had the honor to give him, that their revenues and resources since the war have greatly diminished, and that previous to that period, they were by no means so flourishing as Congress had reason to suppose. In most of the conferences with the Minister, the scarcity of cash has been objected more than the want of inclination, and hints have been thrown out, that it would be much more convenient for the Court, to grant the United States aids in money from their possessions in America than in Europe. Although hopes have been as constantly given, that a part of the sum drawn for would be furnished at the end of the present year, or commencement of the next, and that measures in the mean time might be taken to prevent embarrassments, in case of the arrival of bills after that period, great surprise has been expressed, that Congress should take such a step without previously informing the Court of their intentions, and obtaining its approbation of the measure. Congress will therefore judge of the propriety of disposing of any bills, that may remain unsold, until it is fully ascertained, that they will be punctually paid. Mr Jay, now at Madrid, where the death of his child, and the consequent distresses of his family, detain him a few days, will undoubtedly transmit more ample intelligence on this subject, with the various papers in his possession necessary to explain it. This Court has been obliged to make considerable loans, for their own current expenses, the nature of which I hope to be able to explain in a future letter. It has lately obtained seven millions, five hundred thousand current dollars, in France and elsewhere. The loan is for nine millions, and from the nature of it will create a temporary paper circulation to that amount in this kingdom. I shall transmit to Congress, as soon as it becomes public, a full detail of its operations.

Mr Cumberland, whom I mentioned in my last, and whose name you will find in all the European gazettes, is still at Madrid, from whence he has lately had permission to send a courier to London, but as the Spanish Minister has engaged to impart any serious proposals he may make, and as the French Ambassador expresses no uneasiness from the residence of this gentleman in Spain, although this circumstance at this crisis is extraordinary, we cannot presume there can be solid ground for apprehension. Considerable revolutions, however, have happened in the system of politics of this country, ever since the accession of the House of Bourbon, and where governments are often more influenced by the counsels, and sometimes the caprices of individuals, than from regard to the real and permanent interest of a nation, there is always something to fear. Congress judging from the assurances of the Minister, and the King's character, which is remarkable for steadiness, on the one part, and from the circumstance of Mr Cumberland's residence here, and the constant endeavors of our enemies by every insidious art to misrepresent our situation, on the other, will be best able to draw conclusions from the whole.

The treaty proposed by Russia to the neutral maritime powers, to secure their commerce, and protect their navigation, has been or will be acceded to by Sweden, Denmark, the Hanseatic towns, and Holland, and a Russian squadron is expected in the Channel daily. Portugal, it is said, influenced by England, will not accede to this treaty, which will put a stop to the piratical conduct of that country. France and Spain exclaim, against the partiality of Portugal to Great Britain, and I have been informed, but I do not pretend to vouch for the authenticity of the intelligence, that strong representations have been made to that Court, either to shut its ports against the armed vessels of the nations at war, or to take a part in it. The French Minister to that Court said something to the same purpose to me at Madrid, on his way to Lisbon. The English at present sell their prizes there, without the formality of condemnation.

The Count d'Estaing is now here, and on every occasion manifests the strongest attachment to the United States and their interests. The general opinion gives him the command of a part, if not the whole of the combined fleets, which amount to thirty six sail of the line, now at sea, commanded by M. Cordova. The English fleet under Geary, is also cruizing between Ushant and Cape St Vincent, to prevent the junction of the ships from Brest and Ferrol with the Spanish Admiral, and to protect their outward end homeward bound convoys, and to intercept those of the allies.

I had written thus far, when a courier arrived with the important news of the combined fleets having fallen in with, and taken fiftysix sail out of sixty, destined to the East and West Indies, Madeira and Quebec. I have requested Mr Harrison at Cadiz to enclose to the Committee a list of the prizes, and the nature of their cargoes, as it has not yet been received here. This will be severely felt in England, and will occasion more clamor against the Ministry, than all their naval losses since the war. Mr Jay has heard from Congress but once since we have been in Spain, and very seldom from our other correspondents, the last letters from Paris, mention that Messrs Franklin, Adams, and Dana, were well, and that Mr Adams was going to Holland.

I have the honor to be, &c.

WILLIAM CARMICHAEL.

_P. S._ Since sending off a copy of the preceding letter, I have the pleasure to inform you, that the gentleman expected by the Minister has arrived, and proves to be Don Diego Gardoqui, who is already known by his former correspondence with America. Our affairs are once more in train, some bills have been accepted since his arrival, but nothing certain has been as yet determined, and indeed I fear the Court is too much pressed for money, to do anything considerable for us here in that way. Probably this gentleman will be sent to America, by whom we shall have an opportunity, I hope, of conveying the final determination of the Court with respect to our affairs. The navigation of the Mississippi appears to be the great, and if we can credit the assertions of men in power, the sole obstacle.

Mr Cumberland has been here, and is expected again with his family in a few days. I have been informed, that he has offered on the part of Great Britain, to restore to Spain what they lost by the treaty of Paris, and has been permitted to reside at this Court in expectation of being authorised to make further concessions, and indeed on no other principle can I account for his residence here at this crisis. I mentioned in my letter of the 22d ult., that representations had been made to the Court of Portugal, either to shut its ports against the armed vessels of all nations at war, or take a part in it. I have the honor to inform you, that the above Court has consented to the first of these propositions, although this is not yet public. Another vessel has arrived at Nantes from Philadelphia, by which neither Mr Jay nor myself have received any letters. The Russian fleet, consisting of fifteen sail of the line, and four frigates, is arrived in England. Admiral Geary returned to Spithead the 19th ult. This fleet, it is said, will soon be sent to sea, although he had upwards of two thousand sick when he returned to port. Stocks fell considerably in England when the news arrived of the loss of the convoy beforementioned.

A fleet of seven sail of the line sailed from Ferrol the 22d ult. to convoy off the coast a fleet of transports for the French islands, and probably to cruise to intercept the homeward and outward bound fleets of the enemy. This circumstance joined to the late loss of the convoy, has raised insurance prodigiously in London. The Parliament does not meet until the 28th of September.

W. C.

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TO THE COMMITTEE OF FOREIGN AFFAIRS.

St Ildefonso, September 9th, 1780.

Gentlemen,

I did myself the honor of writing to you the 6th instant, via Cadiz, Bilboa, and France, informing you that the person mentioned in my letters of last month, as chosen by the Minister to succeed M. Miralles, had arrived here, and proves to be M. James Gardoqui, and that since his arrival, our affairs are once more in train. I also mentioned that the Ministry were negotiating loans, to answer extraordinary expenses. I expected to have been able to send the Committee a full account of the nature of these loans, as I founded my hopes of the Court's paying the bills drawn on Mr Jay, by means of the supplies obtained in this way. I am therefore very sorry to inform the Committee, that the success of the most considerable has not answered the expectations of the Ministers, and what is worse, they impute its failure to the interference of M. Necker and others, influenced by that Minister, which has created a soreness, that for the moment must be disagreeable to our ally, and may be disadvantageous to us, unless more important considerations obviate the ill effects to be apprehended from such disappointment, and the personal disgust and resentment consequent thereof.

A person with whom I am well acquainted, is the projector of the loan abovementioned, and although for near three months I have known that such a measure was in agitation, I was not able to discover the plan, it having been preserved with great secrecy, in order to secure its successful and complete operation. As this measure is so far important to Congress, as it may influence the conduct of the Court with respect to money matters, and affect the credit of the nation in future, on which all the vigor of military operations in a great measure depends, I will endeavor to give the outlines of the money negotiation to the Committee, and will forward the plan and the King's ordinance thereon as soon as I receive them.

The original design of this loan was to procure nine millions of dollars, or thirtysix millions of livres in four months, and possibly to enlarge the sum according to exigencies. The projector was to receive ten per cent for expenses and profit, which he was at liberty to divide as he thought proper with the original lenders. To these, I think, he gave three, or three and a half per cent for the use of their money for four months, which money they were to remit in bills of exchange on Spain, and to redraw at the end of four months for their principal and interest. The great secret of the operation is, that government instead of repaying their bills in specie, issues paper to repay them, the credit of which is guarantied by the Crown and the different Chambers or Councils of the Kingdom, viz of Castile, &c. &c. This paper bears an interest of four per cent. A _cedula_, or royal ordinance, will be published the 20th or 21st of this month, which gives it currency, and inflicts severe penalties on any one who refuses it as a legal payment. M. Necker did not discover the latter part of the scheme until large sums had been remitted from France, and I suppose, fearing that its operation would be complete before his representations of what he thought its evil tendency, could be attended to here, he immediately gave orders not to receive the bills of exchange of the houses concerned in this measure at the _Caisse Royale_ in France. Besides, the house of Gerardot, Haller & Co. one of the most considerable in Europe, and of which he was once the head, and his brother is still a partner, wrote circular letters to all parts of Europe discrediting the loan.

The consequence has been, that the persons in France and elsewhere, whose bills were refused at the _Caisse Royale_ have been pushed here so hard by their creditors, that the Spanish government has been obliged to make considerable remittances to support their credit, that further advances of money have been stopped, and that bills of exchange on Spain have sold at a loss of one and one and a half per cent. This has irritated the merchants here, and perhaps we may be the innocent victims. For I am persuaded, that Spain, without obtaining it by loans, has not money in Europe to afford us considerable aids, how great soever her inclination may be to assist us, and I think the Committee will be of the same opinion, on reading the information I gave Mr Jay on the subject of the revenues of this country, in consequence of his instructions to me at Cadiz.

I shall be happy to have it in my power to inform the Committee, that my apprehensions have been ill grounded.

The fate of our bills must soon be determined. More than forty thousand dollars have been presented, of which the amount of about fourteen thousand have been accepted by order of the Minister. The Count d'Estaing will leave this in a few days, and go to Cadiz; by the time he can arrive at that port, the whole of the combined fleet will be assembled; thirtysix sail are now at Cadiz, seven on a cruise, and two of a hundred and one hundred and ten guns are on their voyage from Brest. The Count will urge a vigorous and decisive conduct, and seems to enjoy the King's esteem, and the good will of most of the Ministers and Courtiers.

The English emissary, Mr Cumberland, is still at Madrid, and is permitted to receive from and send couriers to London. The conduct of the Court appears unaccountable, and I cannot persuade myself, that it can be agreeable to France, although the Count de Montmorin frequently assures me, that we need not have any inquietude on account of the gentleman's residence. He no doubt, however, endeavors to insinuate many things to our disadvantage, and makes propositions to alienate Spain from the alliance with France, and from supporting the United States. Those about him are perpetually circulating bad news from America, and assert with confidence, that several States and many individuals in others, are negotiating to make their peace with Great Britain. Spain may possibly be amusing his employers, as he is employed to amuse the Spanish Ministry.

The treaty for an armed neutrality was signed by Sweden the 4th of August; Denmark had not signed it the 8th of the same month, but there is no doubt she will. The English party in Holland opposed and retarded it there as long as possible, and finally clogged it with such conditions as they hope will prostrate the negotiation; for instance, they propose to the contracting powers, to guaranty all their possessions in Europe, Asia, and America, but as the States have gone so far, they will scarce recede, should this article be refused by the others. The eyes of Europe are anxiously turned to America and the West Indies; the friends of liberty hope everything from our union and perseverance, and the expectations of our enemies are founded on the reverse. Neither Mr Jay nor myself have received letters from Congress since we left America, except one from the Committee, enclosing the bills of exchange, so that we are without intelligence, without money, or the certainty of conveying to Congress as regularly as we wish, the information necessary for them to receive, which will plead my apology with the Committee for the repetitions they will meet in this letter of what several other letters contain.

I have the honor to be, &c.

WILLIAM CARMICHAEL.