Part 24

Had these transactions been merely confined to the purchase and delivery of goods, they might, perhaps, easily have been investigated, but they extend themselves to many other things, among which is the transportation, and expenses incident to it. Under this head, two objects present themselves immediately to view. First, whether due care was taken in the mode of transportation adopted; and secondly, whether the expense has been reasonable or exorbitant. With respect to the latter, it will certainly be your duty to correct improper or exorbitant charges. But in the former case, your conduct must be directed by circumstances in their nature so various as to admit of no prescribed rule, and therefore I can only recommend it to you to consult the interests of the United States as far as the principles of justice will permit. I know it is unnecessary to tell you that the delivery of goods purchased and transported should be shown before the charges are admitted; but I must desire that the evidence on this subject may be so clear and plain as to enable us to call the receiver of them to account. Cases will doubtless occur of loss by the accidents of the sea and by enemies; these also should be clearly proved, and the causes, as much as possible, investigated.

Your commission will entitle you to aid and protection in the execution of the duties committed to you; and you will make the necessary applications on the subject to the proper persons, whenever circumstances shall require. A primary object will be to discover what sums have at any time or times been paid to the use of the United States. These can, I suppose, be discovered, and the names of the persons to whom they have been paid, although it is possible that in certain cases the persons by whom they have been paid will not be known to you. The first account you form will be a general one, under the title of loans and subsidies obtained in Europe on account of the United States. The debt of this account you may leave in blank, but the credit side will consist of the sums paid to the use of the United States, and the persons to whom they were paid. Every account of these persons will, of course, be debited in particular accounts, for the respective sums so credited. These sums then they are to account for, and where they have paid over to others, such payments are again to be accounted for, until they are traced to a final appropriation, which will be of articles purchased for, or services rendered to the United States.

In the course of this investigation, however, it may happen, that in some case of payment by one to another, the receiver shall not account properly; on which the question will arise, how far the payment is to operate a discharge to the party by whom it was made. This question admits of so many modifications, according to the varieties of possible circumstances, that no provision can be made, which will be applicable to all. I have therefore thought it best to enclose for your perusal, the instructions on this subject to Commissioners appointed for settling the old accounts of the civil departments. You will govern yourself by the spirit of these instructions, according to circumstances, as they arise. I have already observed, that the final appropriation of moneys must be traced to articles purchased, and services rendered; but such a general distinction would not be sufficiently clear in the stating of accounts; you will place this final appropriation, therefore, under one or other of these following general heads.

1st. _Salaries and Expenses of Public Ministers, Commissioners, and Agents._ In this account you will charge all moneys advanced to any public servants of the United States in Europe on account of their salaries or expenses.

2d. _Clothier General's Department._ In this account you will charge every article of clothing, which may have been purchased.

3d. _Commissary of Military Stores' Department._ In this account you will charge all arms, ammunition, and the like.

4th _Quarter Master General's Department._ In this account you will charge tents, sheet tin for camp kettles, and other articles properly belonging to that department.

5th. _Marine Department._ In this you will charge all moneys expended in building or buying ships of war, and fitting them out, with the incidental charges; also all naval stores purchased for the United States, and the like.

6th. _Hospital Department._ In this you will charge all instruments, medicines, &c. &c. appertaining to that department.

7th. _Merchandise General._ In this you will charge such articles of stores as do not fall within the second, third, fourth, fifth, and sixth heads, if any such there be, and also any articles which you shall be doubtful as to the account they ought to be carried to.

8th. _Transport Service._ In this you will charge the purchase, freightment, hire, insurance, and the like, of ships or vessels for the purpose of bringing any articles to America.

9th. _Contingent Service._ In this you will charge the expense of land transportation, expresses, storages, and other like articles; also all those things, which do not fall properly under some other general head.

10th. _Prisoners and Americans in Europe._ In this you will charge all moneys paid for or to American prisoners or other Americans; taking care so to designate and specify these charges and the parties, so that those who are able may be called on for repayment. The names and usual places of abode will as far as they are attainable, be of importance.

11th. _Foreign Officers._ In this you will charge all sums advanced or paid to foreign officers coming to or returning from America.

12th. _Interest of Debts._ In this you will charge all sums paid on the interest bills of exchange, issued from the several Loan Offices, and any other interest moneys, which may have been paid.

13th. _Bills of Exchange._ In this you will charge all sums paid on bills of exchange, drawn by order of Congress.

It is not impossible, that in the course of your business, you may find it necessary to raise some other such general accounts, and if so, you will raise them accordingly. You will take care to attend strictly to the propriety of all charges made, and to the validity of the vouchers by which they are supported. You will examine very particularly into the accounts of armed vessels fitted out in Europe on account of the United States, especially of those wherein any individuals shall appear to have been interested. And you will bring those persons to account, into whose hands any prizes, or moneys for the sales of prizes, may have come, so that justice may be done as well to the public as to the captors concerned therein.

Whenever you finally settle an account, you will take care to be possessed of the several vouchers, which together with the account are to be kept in your Consular office, until further orders; but you will transmit quadruplicate copies of the general accounts by safe conveyances as soon as possible.

I am, Sir, your most obedient, &c.

ROBERT MORRIS.

* * * * *

TO THE PRESIDENT OF CONGRESS.

Office of Finance, December 12th, 1782.

Sir,

On the 7th of January last, Congress were pleased to resolve, that it be an instruction to the Superintendent of Finance, to prepare and report to Congress a table of rates, at which the different species of foreign coins, most likely to circulate within the United States, shall be received at the treasury thereof. In consequence of this resolution, I took the liberty to recommend the establishment of a mint, which was agreed to. I have taken many steps to carry that resolution into effect, and hoped by this time to have laid a satisfactory state of it before Congress. Delays, the causes of which need not be enumerated, have hitherto procrastinated this matter beyond my expectations. But there are many reasons why an immediate regulation of foreign coins should now be made. It is not the least among them, that all our dollars are rapidly going to the enemy in exchange for light gold, which must eventually cause a considerable loss and scarcity of silver, which will be severely felt. I take the liberty, therefore, to suggest the following Act.

Whereas, by the Articles of Confederation and Perpetual Union, the United States in Congress assembled, are vested with the sole and exclusive right and power of regulating the alloy and value of coins struck off by their own authority, or by that of the respective States; and whereas, the several requisitions on the States and the public accounts of those United States are made and kept in dollars; and whereas, it is of importance, that until money be coined by authority of the United States, some fixed proportion be established between the different foreign coins, most likely to circulate; be it, therefore ordained, by the United States in Congress assembled, and it is ordained by authority of the same, that from and after the 1st day of January, in the year of our Lord, one thousand seven hundred and eightythree, English silver coin be received at the rate of one dollar and sixteen ninetieths of a dollar by the ounce; Dutch silver coin at the rate of one dollar and fifteen ninetieths by the ounce; French silver coin at the rate of one dollar and fourteen ninetieths by the ounce; Portuguese silver coin at the rate of one dollar and thirteen ninetieths by the ounce; English, Spanish, and Portuguese gold coin at the rate of sixteen dollars and sixtyeight ninetieths by the ounce.

I take the liberty to observe, Sir, that this estimate of coins is founded upon the quantity of alloy, which they respectively contain. The weight of each particular piece current among us is so indeterminate, that the value by tale cannot be fixed; but whenever the rates at which they go as bullion are known, a table may be formed in each State for the tale, according to the customary weight which prevails.

I have the honor to be, &c.

ROBERT MORRIS.

* * * * *

GEORGE WASHINGTON TO ROBERT MORRIS.

Head Quarters, December 20th, 1782.

Sir,

In consequence of a resolve of Congress, I some time since directed an inscription with some devices to be engraven on the cannon to be presented to the Count de Rochambeau, and enclosed is a certificate of General Knox relative to the execution of the work and its price.

In answer to Mr Billings's application to me for his pay, I informed him I would write you on the subject, and did not doubt you would order payment to be made.

I have the honor to be, &c.

GEORGE WASHINGTON.

* * * * *

TO B. FRANKLIN.

Office of Finance, January 11th, 1783.

Sir,

On the 9th instant, from an investigation of Mr Grand's account then lately received, I found that after making due allowance for Loan Office bills, &c. which might still come upon him, my drafts and those which I have directed, would exceed by something more than six millions (exclusive of the interest payable by him in November on the Dutch loan) any funds which he could be possessed of. It appeared also by indirect information so late as in the month of September, that the loan opened by Mr Adams had not produced above three millions, so that unless he had met with further success, there would be a deficiency of three millions.

Had the Court granted us twelve millions in the first instance, had Mr Adams's loan produced six millions, had M. de Beaumarchais' bills been provided for without recurrence to the American banker, or, finally, had the heavy deduction made by those bills been replaced, this disagreeable thing would not have happened. Presuming that the loan of the last year was exclusively at my disposition, I drew during the year to the amount of it, and I am convinced that all my bills, and those drawn by my authority, will have been paid. Rely on it, that as I told you in a former letter, I have acted under the influence of dire necessity, and this you will be convinced of by a few out of many circumstances.

Enclosed you have a general statement of the public account until the year 1781, on which you will observe that the army was fed principally, though scantily, by the specific supplies called for at different previous periods, and that there remained in the treasury near three hundred thousand dollars, being part of the money which Colonel Laurens brought with him from France. I also enclose to you the copy of a letter written to Congress on the 21st of October, and of its several enclosures, which will need no commentary; or if it did, I would only add, that I have been obliged to sell part of the goods, which arrived here from Holland, in order to raise so much money as would save my sinking credit from destruction. I would go into a detail of the various measures pursued to stimulate the exertions of the States, but to do this with accuracy, would be to give a tedious history of my whole administration. Whatever expedient could suggest itself, which might have that desirable effect, I have tried, and I do assure you, that when I look back at the scenes I have passed through, they strike my own mind with astonishment. As soon as I can get the accounts made up, I will transmit to you the total of our expenditures; but to transmit, or even relate our hazards and difficulties, would be impossible.

Even at this moment I am making further exertions to bring our unwieldy system into form, and ward off impending evils; but what the success may be, heaven only knows. Imagine the situation of a man, who is to direct the finances of a country almost without revenue, (for such you will perceive this to be) surrounded by creditors, whose distresses, while they increase their clamors, render it more difficult to appease them; an army ready to disband or mutiny; a government, whose sole authority consists in the power of framing recommendations. Surely it is not necessary to add any coloring to such a piece, and yet truth would justify more than fancy could paint. The settlement of accounts, long and intricate beyond comprehension, becomes next to impossible, from the want of that authority which is on the verge of annihilation, from those confusions which nothing can dissipate except the complete settlement of accounts, and an honest provision for payment.

Upon discovering the situation of our affairs in the manner already mentioned, I laid them before Congress. You will know the result. The Secretary of Foreign Affairs will, doubtless, transmit their Act; to which I must add this further communication, that I expect my bills will amount to a million within a month from this date. There are cases, where nothing worse can be apprehended from a measure than what would inevitably happen without it, and our present position is one of them. An immediate command of money is alike necessary to our present existence and future prospects. In Europe, when this letter arrives, you will know decidedly whether we are to expect peace or war. We must prepare for the latter. By so doing we may forward negotiations for peace, and, at the worst, will only have incurred some additional expense, whereas by neglecting it, we risk the chance of being taken unawares, and paying very dearly the penalties of neglect.

But, Sir, notwithstanding these reasons and many others will justify every counsel and every act however irregular in other respects, I would not draw one more bill, and I would boldly hazard every consequence of the omission, if I were not persuaded that they would be paid. On this occasion your sovereign will expect your most vigorous exertions, and your country will, I trust, be indebted to you in a degree for her political existence.

I am, Sir, &c.

ROBERT MORRIS.

* * * * *

TO B. FRANKLIN.

Office of Finance, January 13th, 1783.

Dear Sir,

I have received, in addition to those already acknowledged, your letters of the 12th of August, 26th of September, and 14th of October. I should, therefore, regularly have received two copies of the contract entered into on the 16th of July, between you and the Count de Vergennes, but I suppose it has been omitted through mistake in both the letters which refer to it.[12] I lament this the more, as no one copy of it has yet arrived, and, consequently, the Congress cannot do what I am persuaded they would on the occasion. But although from this circumstance they do not make professions, yet, as far as I know the sentiments of that body, they are penetrated with gratitude. And you hazard nothing in making to the King the fullest assurances of their desire to repay the obligations they have received, and gratify their affection for his person and family by services and benefits. You will oblige me much if (together with the contract in question) you will send a statement of the Farmer-General's account, and of the agreement with them.

[12] See this contract in the _Secret Journal of Congress_, Vol. III. p. 273.

You tell me that the losses in the West Indies prevent you from obtaining farther aid. It is, therefore, to us a double loss. As to the precaution you give me about my banker, you will find that before the receipt of Mr Grand's accounts, I had drawn on him beyond his funds. I have this day entered into an explanation with the Minister on that subject, and I enclose you the copy of my letter, as also of another paper delivered to him, which may be worth your attention. In my turn, I rely upon your promise of exertion to pay my drafts. If one bill should be protested, I could no longer serve the United States.

With respect to the apprehension you express as to my bills, I do not perceive the matter in the same point of light with you. The lists of my bills are transmitted to Mr Grand by various opportunities, and they will check any which might be forged or altered.

I shall take due notice of what you say about your salary, and will enclose the bills to you. The amount will depend on the course of exchange during the war. You will be a gainer, and after the peace you may perhaps lose some trifle, but not much, because remittances might then be made in specie, should the exchange be extravagantly high. You will readily perceive, that although the fluctuations of exchange are in themselves of very little consequence to the individuals who may be connected with government, they become important at the treasury, partly from the numbers of payments and consequent amount, but more so because they would introduce a degree of intricacy and perplexity in the public accounts, which are generally either the effect, or the cause of fraud and peculation. Besides, there is no other way of adjusting salaries, than by a payment of so much at the treasury, unless by rating them in the currency of every different country as livres, dollars, guilders, rubles, &c. The late mode of rating them in pounds sterling, required a double exchange. For instance, the number of livres to be given in payment of one hundred pounds sterling at Paris on any given day, depends on the then rate of exchange between Paris and London, and the value of those livres here depends on the exchange between Paris and Philadelphia.

I pray you, Sir, to accept my sincere thanks for the kind interest you take in the success of my administration. The only return, which I can make to your goodness, is by assuring you, that all my measures shall be honestly directed towards the good of that cause, which you have so long, so faithfully, and so honorably served.

I am, Sir, &c.

ROBERT MORRIS.

* * * * *

TO MR GRAND.

Office of Finance, January 13th, 1783.

Sir,

I have received your several favors of the 13th of July, 11th and 19th of August, and 14th of October. The contents are far from being agreeable, but I thank you for the communication of them. If I had been so fully apprized of our situation as I now am, perhaps I might have suffered everything to be ruined, rather than have risked my bills. But if that had been done, more men would have blamed than applauded my conduct. I have gone into a full explanation with M. de la Luzerne, and although he cannot as Minister approve what is done, he has too much sense not to see the propriety and necessity of it.

It will be very useful both to you and me, that we should know exactly the state of our affairs, but I cannot acquire that knowledge by any comparison of accounts in my possession. You I think will be able to do it, and for your assistance I send the following information. There have been issued from the several Loan Offices, bills, at thirty days' sight, for eight millions four hundred and thirtyone thousand seven hundred and fifty livres; bills at sixty days' sight, for one hundred and twentyfive thousand livres; and bills at ninety days' sight, for one million three hundred and sixtyfour thousand one hundred and ninetyone livres, thirteen sous, and four deniers. An examination of your books will show at once how much of these sums remains unpaid. There have been issued bills on Mr Laurens and Mr Adams in Holland, for five hundred and fortyseven thousand three hundred and sixtyfour guilders and two thirds; and there have been issued on Mr Jay, for four hundred and fiftyeight thousand eight hundred and twentysix dollars. A proper inquiry will, I suppose, obtain the amount of payments on all these bills, and then you will be possessed of the state of things so fully, that you can apprize me of facts sufficient for my information.

From the best information I have been able to collect on the subject, my bills have very considerably exceeded your funds, but I trust that you have been possessed of additional funds for the acquittal of them in due season. I do everything that I can, and shall expect that you will exert yourself, to aid Dr Franklin. On those exertions I place much reliance; being with sincere esteem, Sir, your most obedient, &c.

ROBERT MORRIS.

* * * * *

TO M. DE LA LUZERNE.

Office of Finance, January 13th, 1783.

Sir,

In the close of our conversation on the 11th instant, your Excellency did me the honor to request that I would recapitulate to you in writing, the reasons why my bills had exceeded the funds in possession of Mr Grand, by about three millions and a half of livres. I undertake this task with pleasure, but I will premise, that in the course of this letter (seeking clearness more than precision) I will not trouble you with an attention to fractional sums, but rather to round numbers.

You will remember, Sir, that shortly after your arrival in this country, the Congress, while they continued their drafts for interest, added a number of other bills on Dr Franklin, at a long sight, which they directed to be sold; and urged by their necessities, and relying on the success of measures then just undertaken, they drew other bills at a long sight on their Ministers in Spain and Holland. Before this they had drawn bills on Dr Franklin, in favor of M. de Beaumarchais, for nearly three millions, of which two millions and a half were payable in June, 1782. The amount of all these bills, exclusive of those to M. de Beaumarchais, was between thirteen and fourteen millions. How great a proportion of this sum had been paid, and how much remained due, it was impossible for me to determine with precision, because I had not received the accounts, but the best estimate in my power was made.