Part 25

Your Excellency will also remember, that from the sketch which you did me the honor to deliver from the Count de Vergennes, there was due on the Dutch loan of 1781 about four millions, or three and a half after deducting the supposed expenses of that loan. I considered this balance as sufficient to liquidate what I estimated to remain due of the several bills drawn by order of Congress as above mentioned, excepting the two millions and a half payable in June last. I perceive, however, from Mr Grand's accounts, that although his Majesty, among other acts of his royal generosity, remitted the expenses of the loan, yet the balance actually touched by the banker, amounted only to about two and a half millions. Thus there was a deficiency of a million in what I had relied upon to acquit former engagements. It is necessary for me to mention here, that I had allowed also for a supposed deduction on account of the Virginia goods, but as I had also supposed, that fewer of the Congress bills remained unpaid than appeared afterwards to have been, so one error eventually corrected the other, and left the deficiency still at a million. It is proper also to observe further, that although the loans and subsidies of 1781, amounting in the whole to twenty millions, had been principally employed in the purchase of clothing and military stores, yet the continuance of those things in Europe by various delays and mischances obliged me to make provision for the same articles here, forming thereby a heavy deduction from the small means which were at my disposal.

Having said thus much of things previous to the year 1782, I must now take the liberty to remind your Excellency, that I had requested the sum of twelve millions for that year, on the principle, that after deducting two millions and a half for M. de Beaumarchais, the remaining nine and a half would be absolutely necessary, and I then did expect much more from the States than has been received. The Court, however, granted only six millions, but I had every reason to suppose, that this sum would be exclusively at my disposition; and therefore in consequence of your Excellency's assurances, and according to your advice, I drew twelve bills of half a million each on Mr Franklin, in favor of Mr Grand, and I appropriated this money to the payment of what bills I should draw on him; excepting a part which I desired him to ship during the last summer, when bills were not saleable, and which I expected here in November, or December; but as it did not arrive, I conjectured as the event has shown, that no shipment was made, and extended my bills accordingly. As to M. de Beaumarchais' bills, I expected that some arrangement might have been taken with relation to them, according to our conversations. For although you declared that you had no instructions on that subject, yet you saw with me that our funds would not bear such a deduction, and the line of conduct which you advised, was precisely that which I pursued, as I shall presently have occasion to mention.

I relied then on the loan of six millions, and on three millions which Mr Adams had obtained in Holland, so long ago as in September last. My appropriation of these sums was as follows. Bills drawn on Mr Grand in 1782 for six millions, being the amount of the loan made by his Majesty; one million negotiated through the Havana; half a million which I directed for payment of interest on the Dutch loan of 1781; and a million and a half drawn for in 1783, at the time I had the honor to speak to your Excellency, formed the amount of three millions in Holland, which by the Acts of Congress were exclusively at my disposition.

It was not, therefore, until the investigation of Mr Grand's accounts, that I was struck with the deficiency above mentioned, and which arose from the difference of one million due on the former transactions more than I had calculated, and two millions and a half to M. de Beaumarchais. The moneys which I supposed to be at my sole disposal were, I found, subject to Dr Franklin's order, and therefore Mr Grand instead of six millions possessed only two and a half towards answering my bills drawn in 1782. I had written to Dr Franklin in the manner agreed between us as to M. de Beaumarchais. But the money was paid before the letter arrived. I should not, however, do that justice to Dr Franklin which I ought, if I did not observe, that I think he was perfectly right in causing those bills to be paid. You will consider, Sir, that they had been drawn in 1779, and negotiated for three years, through different parts of Europe and America, on the public faith and credit of the United States. It is a very moderate calculation to suppose, that a thousand different people were interested in the sum of three and a half millions. Protesting the bills, therefore, would have sent them back again from one person to another, affixing a stigma on our character wherever they went. The necessary consequence would have been, not only a total loss of credit in Europe, but that no person here would have bought my bills. The funds, therefore, which I could command would have been useless, and the difference between not having money and not being able to use it is immaterial.

Having said thus much, Sir, on the reason of the deficiency, I find it proper to add, that the bills drawn in December and November amount to two millions; which being at thirty days' sight will not be payable until February or March next. One million negotiated through the Havana on Cadiz, thence to Paris, &c. will not finally be payable until March and April. And one million drawn the beginning of this month at one hundred days' sight, will not fall due until some time in April and May. On the other hand, any further success of Mr Adams's loan will apply for the payment.

I trust from the whole state of these things your Excellency will see, that nothing has introduced any disorder into these transactions, but the appropriation without my authority of moneys intended to be at my disposition, and that this again has arisen from the utter incapacity of Dr Franklin any otherwise to acquit the demands on him, arising from expenditures made some years before my administration. If I might venture, therefore, to advise, it should be that three and a half or four millions were paid to Mr Grand as an addition to the loan of 1782, and then the sum which the Court may think proper to advance for 1783, being clear of preceding transactions, I will pledge myself that no act of mine shall exceed the limits to be prescribed by your Court.

You see, Sir, that I rely on aid for the current year; and this brings me to the resolution of Congress, which I had also the honor to communicate. You observed on it with great propriety, as a Minister of France, that you advised me not to comply with it; and as a Minister of the United States I might reply, that I should certainly obey the order of my masters. At the bottom I believe we are both agreed. I would not put my name to a bill if I doubted the payment, and you must be convinced that it is necessary to draw. Not to mention those critical circumstances of the army, which you are perfectly apprized of, it must be remembered how important an effect it might have on the negotiations for peace, if we should now neglect to prepare for war, and much more if we should suffer any serious misfortune. To keep the army together, in good humor and prepared for action, is a duty which we owe alike to ourselves, to our allies, and to our associates in the war.

I shall I believe draw within a month for at least a million. You know, Sir, that the funds given by the States are incompetent, and I am sure you will do me the justice to believe, that I have done all in my power to husband our means and to increase them. That I have not talents equal to this task must be lamented and forgiven. It is not my fault but my misfortune. The share of abilities which I possess, be it what it may, has been faithfully exerted. If, however, I have incurred censure on the present occasion, it must be because I was ignorant of what I could not know, and did not perform what was not in my power.

I am, Sir, with respect and esteem, &c.

ROBERT MORRIS.

* * * * *

TO JOHN ADAMS.

Office of Finance, January 19th, 1783.

Sir,

Although I have not yet been honored with any letters from your Excellency, I cannot omit the occasion of writing, which offers itself by Mr Jefferson. Having already congratulated you on the acknowledgement of our independence by the States-General, and on the rapid success of your labors equally splendid and useful, I hope when this letter shall have reached your hands I may have the additional cause of congratulation, that the loan you have opened in Holland shall have been completed. This is a circumstance of great importance to our country, and most particularly so to the department, which I have the honor to fill. Whatever may be the success of it, whether general or partial, I pray your Excellency to favor me by every conveyance with every minute detail, which can lend to form my judgment or enlighten my mind.

For the more perfect security of our correspondence I do myself the honor to enclose the counterpart of a cypher, to the use of which you will soon become familiarised, and I hope you will be convinced, that any confidence with which you may honor me shall be safely reposed and usefully employed for the public benefit.

I have the honor to be, &c.

ROBERT MORRIS.

* * * * *

TO THE PRESIDENT OF PENNSYLVANIA.

Office of Finance, January 20th, 1783.

Sir,

I had the honor to receive your Excellency's favor of the 18th of last evening. In answer, it becomes my duty to convey to your Excellency, the painful information, that those affairs of Congress, which relate to the public revenue, are reduced to the most critical situation. They are now under contemplation of that honorable body, and I shall take the earliest opportunity of communicating to the several States the result of their deliberations.

It is also my duty, Sir, on this occasion, to remind your Excellency, that on the 2d day of November, 1781, the Congress required of the State of Pennsylvania, one million one hundred and twenty thousand seven hundred and ninetyfour dollars, as the quota of that State, for the expenditure of the year 1782. This sum was to have been paid in equal quarterly proportions, commencing on the 1st day of April last. I am extremely sorry to mention, that during the whole of the year, 1782, there has been received towards the payment of this quota, only the sum of one hundred and seven thousand nine hundred and twentyfive dollars and twentyfour ninetieths, being less than a tenth of the sum required. It is of little avail, Sir, that the army who are the immediate sufferers, or the people of America whose national existence is so imminently hazarded, should be told, that a law has been enacted for raising the sum required. Laws not executed, or which from their nature are not to be executed, only substitute deception in the place of denial. Congress can never believe, that a State seriously means a compliance with the demands made on it, unless the laws be such, that responsible officers be sufficiently empowered to collect the taxes by certain specified periods, and that the Continental Receiver of taxes be empowered after such periods shall have elapsed, to issue executions against the persons and estates of those officers for any deficiency, which may remain of the sums payable by them respectively.

I have the honor to be, &c.

ROBERT MORRIS.

* * * * *

TO GEORGE WASHINGTON.

Office of Finance, January 21st, 1783.

Sir,

I have received your Excellency's favor of the 6th and 8th instants. I have directed the Commissary of Marine Prisoners to appoint a proper agent at Dobbs' Ferry, and I hope for your Excellency's advice to him on that occasion, which he will be desired to apply for. Without wishing to incur the blame of too great suspicion, I take the liberty to suggest, (as an additional reason for caution;) that moneys intended for commercial pursuits, might be transmitted under the idea of relieving prisoners. Mr Skinner has never yet communicated his returns or accounts.

It was with very great pleasure, Sir, that I paid the money you desired, to Mr Adams, and I beg you to believe, that I shall at all times be happy to facilitate your views. At present, the negotiation happens by good luck to minister alike to your convenience and mine. I am very sorry, that you did not make an earlier mention to me of your demands for secret service. I would have anticipated your views, had it not escaped my attention, for be the distresses of my department what they may, this is of too much importance ever to be neglected. I think it best in future, that a solid arrangement should be taken, and for this purpose I will give directions to the Paymaster General always to keep some money in the hands of his deputy, to answer your drafts for contingencies and secret service. I have, as you will see, taken methods to put the deputy in cash, and then your Excellency will be relieved from any further care than the due application. I am, however, to pray for the sake of regularity in accounts, that your Excellency in the warrants would be so kind as to specify the particular service when on the contingent account, and draw in favor of one of your family on account of secret services, mentioning that it is for secret service. I shall direct Mr Swanwick to endorse the bills on you in favor of Mr Adams to the Paymaster General, whose deputy will receive from your Excellency the amount.

I have the honor to be, &c.

ROBERT MORRIS.

* * * * *

TO THE PRESIDENT OF CONGRESS.

Office of Finance, January 24th, 1783.

Sir,

As nothing but the public danger would have induced me to accept my office, so I was determined to hold it until the danger was past, or else to meet my ruin in the common wreck. Under greater difficulties than were apprehended by the most timid, and with less support than was expected by the least sanguine, the generous confidence of the public has accomplished more than I presumed to hope.

Congress will recollect, that I expressly stipulated to take no part in past transactions. My attention to the public debts, therefore, arose from the conviction, that funding them on solid revenues was the last essential work of our glorious revolution. The accomplishment of this necessary work is among the objects nearest my heart, and to effect it, I would sacrifice time, property, and domestic bliss.

Many late circumstances have so far lessened our apprehensions from the common enemy, that my original motives have almost ceased to operate. But other circumstances have postponed the establishment of public credit in such a manner, that I fear it will never be made. To increase our debts, while the prospect of paying them diminishes, does not consist with my ideas of integrity. I must, therefore, quit a situation which becomes utterly insupportable. But lest the public measures might be deranged by any precipitation, I will continue to serve until the end of May. If effectual measures are not taken by that period, to make permanent provision for the public debts of every kind, Congress will be pleased to appoint some other man to be the Superintendent of their Finances. I should be unworthy of the confidence reposed in me by my fellow citizens, if I did not explicitly declare, that I will never be the minister of injustice.

I have the honor to be, &c.

ROBERT MORRIS.

* * * * *

TO THE PRESIDENT OF CONGRESS.

Office of Finance, February 26th, 1783.

Sir,

A number of those who have contracted engagements with me will, I know, place a personal reliance on me for the fulfilment of them, As the time approaches very fast when I am to quit this office, it is proper for me to make the necessary preparations. Among these, I must place the due and seasonable information, which as an honest man I must convey to those who have confided in me. I am, therefore, to pray that the injunction of secrecy, contained in the order of the 24th of January last, may be taken off. At the same time, I take the liberty to suggest to Congress, that the early appointment of my successor, will give him opportunity to take such measures as may prevent many inconveniences that might otherwise happen.

I have the honor to be, &c.

ROBERT MORRIS.

* * * * *

TO GEORGE WASHINGTON.

Office of Finance, February 27th, 1783.

Sir,

I do myself the honor to enclose to you the copy of a letter to the President of Congress, which was written on the 24th of last month. I should have transmitted it to you on the next day, but contrary to my expectations, Congress enjoined secrecy. I yesterday wrote a letter, of which I also enclose a copy, and in consequence of it I am this instant informed that the injunction of secrecy is taken off. I seize, therefore, the earliest moment to give you the information.

I do assure you, Sir, that nothing would have induced me to take this step, but a painful conviction that the situation of those to whom the public are indebted is desperate. I believe, sincerely, that a great majority of the members of Congress wish to do justice; but I as sincerely believe that they will not adopt the necessary measures, because they are afraid of offending their States. From my soul I pity the army, and you, my Dear Sir, in particular, who must see and feel for their distresses, without the power of relieving them.

I did flatter myself that I should have been able to procure for them that justice to which they are entitled; and in the meantime, I labored to make the situation as tolerable as circumstances would permit. For the assistance which you have kindly afforded me, I pray you to accept my thanks, and to be assured that I shall ever retain on that account the most grateful emotions. My thanks are due also to all our officers, for I know that unwearied pains have been taken to give them disagreeable impressions, and I am, therefore, doubly indebted for the just sentiments, which amid so many misrepresentations they have constantly entertained. I hope my successor will be more fortunate than I have been, and that our glorious revolution may be crowned with those acts of justice, without which the greatest human glory is but the shadow of a shade.

I am, Sir, &c.

ROBERT MORRIS.

* * * * *

TO WILLIAM CARMICHAEL, IN MADRID.

Office of Finance, March 4th, 1783.

Sir,

You will probably recollect that Mr Jay protested ten bills of exchange, each for two hundred and twentyfive Mexican dollars, of which the list is enclosed. These bills, with the addition of twenty per cent damages, amount to two thousand seven hundred dollars, for which I have this day signed a set of bills on you, which, to avoid the dangers to which communication is liable, are extended to the eighth bill. This draft is at six months' sight, and I am to desire that you will honor it, and take your reimbursement on Mr Grand. The length of sight may probably place it at a considerable discount on the exchange of Madrid, and it is probable, also, that you may draw on Mr Grand to advantage; if so, I conceive it would be best to have the bill bought.

Draw on Mr Grand at the common usance, and close the transaction; which I hope may be the last of the kind, which the American government will be concerned in. An additional reason for suggesting this is, that should this bill go through hands ignorant of the whole transaction, it may give rise to conjectures, that the former practice of drawing is about to be revived. I should have drawn on France or paid in cash, but as the party is at Boston, and the rate of the exchange unfixed, it is more conformable to mercantile usage to give a new bill for the principal and damages.

I am, Sir, &c.

ROBERT MORRIS.

* * * * *

TO THE PRESIDENT OF CONGRESS.

Office of Finance, March 8th, 1783.

Sir,

I received yesterday afternoon a report, which is to be considered on Monday the 10th instant, and with it I received an order to transmit my observations. The shortness of the time obliges me to ask indulgence for deficiencies or inaccuracies. I have always believed that Congress were disposed to do _justice_ to the public creditors, and I shall presume that the _power_ of Congress will be exerted for that purpose.

There appear, therefore, two principal points to be considered.

I. What justice requires; and,

II. What Congress have power to do.

To the first I answer. _Justice requires that the debt be paid._ The _principles_ of justice require that from a government, which a _court_ of justice exacts from an individual. Government have no right to oblige creditors to commute their debts for anything else. Any revenues, therefore, to be pledged for the restoration of public credit must be such, that money may be borrowed on them to pay those to whom it is due; any plan which falls short of that object will not do justice. And no plan will embrace that object unless it be such that under it individuals would prefer government security to any other. In our particular situation it appears clear, that such public creditor has a complete right to demand his whole debt from Congress, and to name the terms on which he will forego it, and that Congress have a similar right in regard to the States.

In order to determine on the second question, viz. the _power_ of Congress, we must resort to the confederation. By the eighth article it will appear, that Congress have a right to determine on the sum to be paid by the States, and the time of payment; and that this sum is to be paid by the States in proportion to their respective value, or an estimation to be made in the mode to be appointed by Congress. It is, therefore, in the _power_ of Congress to call for payment of the whole debt by any day; such for instance as the 1st of January; and to have a valuation made some previous day; such for instance as the 1st of September. _The right of Congress is perfect, and the duty to pay absolute._ It appears necessary that this power be exerted in the most _decisive form_, and that whatever _general plan_ of finance may be adopted, the concurrence of each State in such plan should be admitted _as an alternative_ for not paying her apportioned quota of the whole debt. My reasons are these.

1st. It will not be believed, that Congress have no power to do justice until the power which they have is exerted.

2dly. The public creditors have a right to expect that exertion.

3dly. Until it be made, a compliance with the demands of Congress will be considered by the States as a matter of favor and not of right.

4thly. Congress having a right to the whole money, it follows that they have the _exclusive_ right to name those precise terms on which they will commute it.

5thly. Hence it follows that their plan, (be it what it may) must be adopted by the States in all its parts, because none of them can have a right to make amendments.

6thly. The objections heretofore raised against the impost will by this means be totally done away, because each State may at its option either comply with the general plan or pay her particular share of the whole debt.

7thly. If the plan proposed as an alternative be adopted, it will from the nature of the case be an express national compact between the United States and each individual State. The revenue will have been purchased by Congress and they will have a perfect right to insist on their bargain.