CONTENTS (continued 6)

I am, Sir, &c.

ROBERT MORRIS.

TO M. DE LA LUZERNE.

Office of Finance, October 2d, 1782.

Sir,

I have the honor to enclose for your Excellency's perusal, the copies of letters from this office to Dr Franklin, of the 27th of last month and the 1st instant. I am to entreat, Sir, that you will represent to your Court the necessity of the application, which Congress have directed their Minister to make for four millions of dollars. The resolutions on the subject have, I suppose, been communicated to you by the Secretary of Foreign Affairs. I have, also, to request that you will facilitate the arrangements proposed in my letters already mentioned, the advantages of which are so well known to you that I shall not dwell on them.

With real esteem and respect, &c.

ROBERT MORRIS.

TO ALEXANDER HAMILTON.

Office of Finance, October 5th, 1782.

Sir,

I have now before me your letters of the 14th and 21st of last month. I am sorry to find that you are less sanguine in your pecuniary expectations than the Governor appears to be; for I have always found that the worst forebodings on this subject are the truest.

I am not surprised to find that the contractors apply with their paper, in the first instance, to the receivers and collectors. This I expected, because much of that paper is not fit for other purposes. Some of it, however, which is payable to the bearer, is calculated for circulation, which you observe, is not so general as otherwise it might have been, by reason of the largeness of the sums in the notes. Mr Duer's letters contain the same sentiment.

In issuing this paper, one principal view was to facilitate the payment of taxes, by obviating the too general, though unjust, complaint of the want of a circulating medium. In substituting paper for specie, the first obstacle to be encountered, was the difference which has arisen from the late profusion of it. Had a considerable quantity been thrown into the hands of that class of people, whose ideas on the subject of money are more the offspring of habit than of reason, it must have depreciated. That this apprehension was just, is clear from this fact, that the paper I first issued, and the bank paper which came out after it, did depreciate from ten to fifteen per cent in the Eastern States, notwithstanding all the precautions which were used. If I had not taken immediate measures to create a demand for it on the spot, and to stop issues to that quarter, its credit would have been totally lost for a time, and not easily restored. Besides that the quantities, which were pouring in from thence would have done mischief here. Confidence is a plant of slow growth, and our political situation is not too favorable to it. I am, therefore, very unwilling to hazard the germ of a credit, which will in its greater maturity become very useful. If my notes circulate only among mercantile people, I do not regret it, but rather wish that the circulation may be for the present confined to them and to the wealthier members of the professions.

It is nothing but the greater convenience, which will induce people to prefer any kind of paper to the precious metals, and this convenience is principally felt in large sums. Whenever the shop-keepers in general discover that my paper will answer as a remittance to the principal ports, and will be readily exchanged by the receivers, they will as readily exchange it for other people. When the people in general, find that the shop-keepers receive it freely, they will begin to look after it, and not before. For you must know, whatever fine plausible speeches may be made on this subject, the farmers will not give full credit to money merely because it will pay taxes, for that is an object they are not very violently devoted to; but that money that goes freely at the store and the tavern, will be sought after as greedily as those things which the store and the tavern contain.

Still, however, your objection remains good, that the trafficking in which the greater part of the community engage, do not require sums so large as twenty dollars. This I shall readily acknowledge; but you will observe, that there is infinitely less danger that notes, which go only through the hands of intelligent people will be counterfeited, than small ones that come to the possession of illiterate men. When public credit is firmly established, the little shocks it receives from the counterfeiters of paper money, do not lead to material consequences; but in the present ticklish state of things, there is just ground of apprehension. Besides this, the value of paper will depend much upon the interchanges of it for specie; and these will not take place when there is a circulation of small paper. Lastly, I have to observe, that until more reliance can be placed on the revenues required, I dare not issue any very considerable amount of this paper, lest I should be run upon for more than I could answer; and as the circulation of what I dare issue, by increasing the general mass, enables people (as far as it goes) more easily to get hold of other money, it consequently produces, in its degree, that object of facilitating taxation, which I had in view.

I am, Sir, &c.

ROBERT MORRIS.

TO B. FRANKLIN.

Office of Finance, October 7th, 1782.

Sir,

Captain Barney having been detained until this day, and it being probable that he will not arrive in Europe so early as I expected, I am very doubtful whether it would be proper to send him to the Havana, but think it would be better he should return immediately hither, because it is likely that the negotiation I proposed will consume more time than he can spare. His ship is small, but she sails remarkably well, and will, therefore, give us a good chance of being well informed of the situation of our affairs.

If there is likely to be any delay or difficulty in the Havana plan, it will be best that you endeavor to obtain the shipment of a considerable sum in Europe on board some of the King's frigates. At any rate, we must have money, and I think you may venture fifty thousand crowns by this vessel. You will see that Captain Barney is put under your directions, and is to wait your instructions; but I must at the same time inform you, that Congress have directed his ship to be purchased and sent to France, among other things, for the purpose of obtaining a better communication with their servants, and more frequent and accurate intelligence from Europe. You will see, therefore, the propriety of despatching her as speedily as possible, and I think we may, probably, fall upon ways and means to afford you frequent opportunities of writing with a great chance of security.

I am, Sir, &c.

ROBERT MORRIS.

TO GEORGE WASHINGTON.

Office of Finance, October 15th, 1782.

Sir,

I have received your letters of the 2d, 3d, and 7th instant. There is no man in America, more heartily disposed than I am to remove from the army and from all others who have claims on the public, every just ground of complaint. But with the means in my power, how is it possible? I have been obliged to submit to cancelling one contract and forming another, at one third advance on the former price, for the want of a mere trifle, compared with what we had a right to expect. I am in advance on credit to an amount, which you can scarcely form an idea of, although I have declined every expenditure not indispensable.

That part of the late arrival of clothing, which is unfit for soldier's use, is now selling to pay debts contracted by the clothing department during my administration. Among these debts are twelve thousand dollars for needle work done by people in extreme indigence. The clothing which arrived fit for the officers' wear, was inadequate to the purpose of clothing them all. The division must have created confusion and raised disputes. If this had not been the case, still it would have been liable to the inconveniencies attending partial payments, and we should have been justly reproached for having broken repeated promises, that no such payments should take place. Congress have done all in their power to procure money for the army. My own efforts I shall not dwell upon. If money is obtained, that will produce satisfaction; I am sure that nothing else will.

My credit has already been on the brink of ruin. If that goes, all is gone; but if it can be preserved, there will, in the last necessity, be some chance of making advances on credit to the army, as well as to others. Thus, Sir, you will see that I look forward as far as my distressed situation will admit; but after all, if the States cannot be prevailed on to make greater exertions, it is difficult to see where the thing is to terminate.

I have this day commissioned Major Turner as Marine Commissary of prisoners, and I trust he will soon be in capacity to prevent your Excellency from having any further trouble on that subject.

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

ROBERT MORRIS.

TO THE GOVERNOR OF NORTH CAROLINA.

Office of Finance, October 7th, 1782.

Sir,

Since the receipt of your favor of the 20th of August last, I have received copies of a correspondence between yourself and Colonel Carrington on the subject of specific supplies. The disposition which you have expressed, (in your letter to me, and which indeed breathes through your whole correspondence) to promote those plans of regularity and economy, which Congress have adopted, command my sincere acknowledgements.

I perceive that there is a difference of opinion between the officers of the continent and your State on the receiving specific supplies, which I attribute principally to some misunderstanding of the matter. The specific supplies called for by Congress in their several resolutions on that subject are undoubtedly receivable, and ought above eighteen months ago to have been received, on the requisitions which were made at the rates for that purpose mentioned. Such as it may now suit any State to deliver on those requisitions, ought in like manner to be carried to account. But it is very clear, that they cannot be received on account of the subsequent money requisitions. The several quotas of the eight millions asked for last year, to supply the current expenditures of the year 1782, must be paid in cash, or what is equivalent to it, in my notes or bank notes. I cannot consent to receive anything else. It is by this means alone, that economy can be established, order restored, and confusion, that parent of fraud, too apt to introduce itself into public accounts, banished and destroyed.

I incline to think, that as Congress have determined to have all accounts settled and liquidated to the end of the year 1781, your State would rather choose to attend only to the money requisition, and leave the further delivery of specifics to a liquidation of the old accounts; but if not, there can be no doubt but the specifics will be received, and in such case I will give the gentleman whom I shall appoint as Receiver of taxes in your State, instructions how to dispose of them; but I must again repeat, Sir, that I will not accept one particle of them in abatement of the State quota for the year 1782.

Before I close this letter I must take the liberty to mention a matter, which suggests itself from one of your letters to Colonel Carrington. You tell him that you will continue the prohibition against sending certain things out of the State, in order that he may purchase for the United States on better terms. Now, Sir, while I feel it my duty to require justice for the United States it is equally my duty to take care that equal justice be done to the several States, individually considered, as well as to the individuals which compose them. I am, therefore, to request that all such restrictions be taken off. They sour people's minds, destroy the spirit of industry, impair by a rapid as well as a certain progress, the public wealth of the State, producing a dearth of the things embargoed, eventually enhance the prices far more than they could have been increased by any other mode. Whereas perfect freedom makes the people easy, happy, rich, and able to pay taxes, and the taxes when paid can be expended amid a plenty of products, and consequently be expended to advantage. I say a plenty of products because I know, that liberty to dispose of them to the greatest advantage will encourage men to raise them and produce a plenty. Your Excellency will, I hope, excuse reflections which arise from an ardent desire to promote the general welfare and happiness of all the inhabitants of the United States.

I have the honor to be, &c.

ROBERT MORRIS.

TO MAJOR GENERAL GREENE.

Office of Finance, October 17th, 1782.

Dear Sir,

I have received your letter of the 1st of September, for which I pray you to accept my acknowledgements. Amid the many distresses and cares, which await every step of my administration, it is a great relief and consolation to have met with the support of those who command (and what is more, who worthily command) the armies of the United States. I have felt, my Dear Sir, your efforts to support my measures, and I know that they have been useful. I wish it were in my power to give to you and to your brave army that full relief, which their conduct, their sufferings, and above all, their patience, have merited.

I had intended to supply their subsistence, and the little contracts in Virginia, from the quota of that State, as the money there collected would have been nearest the spot where it was to be applied. But I need not tell you how deficient that State has been. The consequence is, that I must endeavor to supply the deficiency from other sources, which I am now doing; but in the precarious state of things at present, there is no reliance to be placed on any measure. I suppose, however, that the evacuation of Carolina will enable you to move northward, with a considerable part of your army; these will, I hope, meet the relief intended. I shall direct a statement of the whole to be made out by the Pay Master General, and do whatever may lay in my power; but as to pay, my inviolable determination is, that the whole army shall equally share whatever is disposed of in that way.

The disposition of the State of North Carolina to pay in specie, is far from being peculiar to that State. Attempts of the same kind have been made by others; and they have invariably been opposed and shall be. There is however a distinction to be taken. You recollect that Congress called for large quotas of specie. I am perfectly persuaded, that no State has fully obeyed that call, but many, and indeed almost all, aver that they have overpaid. The last requisitions have been for money; and if I had not by the publications prevented such assertions, it would not be surprising, that they should be repeated, even as to the money quotas. Now if the State of North Carolina are desirous of paying in specie, on the requisitions of specie, I shall not have the least objection; but on the requisitions for the service of the current year, I will receive money alone. I make this distinction in such clear and peremptory terms, to avoid all further cavils on the subject. I see that it has already been drawn into some length, and must, therefore, be finally terminated. Besides, under the present appearances there can be little doubt, that specie in North Carolina will be almost as useless as if they were in Otaheite. A copy of my letter to Governor Martin on this subject shall be enclosed to you.

You have in several of your letters, made very just observations on the business of my department, and such as convince me you have turned your attention to it. I have therefore taken the liberty to enclose to you a copy of a letter to Congress, on the subject of a mint, of one on the establishing public credit by funding our debts; and of a third, on the estimates for the ensuing year.

As there is a report, that the enemy got several letters intended for you, it is possible that some or other of those, may be among the number.

I pray you to believe me, with very sincere esteem, your most obedient servant,

ROBERT MORRIS.

GEORGE WASHINGTON TO ROBERT MORRIS.

Head Quarters, October 18th, 1782.

Sir,

I take the liberty to enclose to your care, a letter for the Chevalier de la Luzerne, on the subject of expense, which at his request I have incurred, for the purpose of forwarding intelligence of the movements of the enemy at New York, to the Marquis de Vaudreuil.

If our circumstances would admit, I should be very glad that this expense should be defrayed by the United States; it is infinitely short of the debt, which gratitude imposes on us. I submit therefore to your judgment, whether to deliver the enclosed, or to send forward the money from your own funds, agreeably to the monthly estimate sent to the Minister.

The chain of expresses was instituted about the middle of August, and will probably be continued till the sailing of the French fleet from Boston.

I am, &c.

GEORGE WASHINGTON.

CIRCULAR TO THE GOVERNORS OF THE STATES.

Office of Finance, October 21st, 1782.

Sir,

I have on many occasions warned the States of the consequences which must follow from delays in supplying the treasury. The expense which attends such delays, has frequently been mentioned, and instances daily occur to show, how much the public burdens are increased by the want of a timely provision. To cite them all would be endless; but there is one of no inconsiderable magnitude, which I think it proper to state for your consideration. I had contracted on the part of the United States for the supply of rations to the main army, at ten pence Pennsylvania currency, and to the garrison at West Point for nine pence half penny, and had agreed to pay, at the commencement of each month for the issues of the preceding month.

These beneficial contracts have been dissolved by my inability to make punctual payments, which rendered the contractors incapable of performing their engagements. After many efforts on my part to supply the want of cash, and on their part to substitute private credit and promises in the place of ready money, they found it impracticable to proceed further on the moderate terms stated in the contract. Some of them told me so, and asked (what any persons in their situation would have asked) the promise of indemnification for any damages they might sustain. And a promise to pay at the end of each month, one half the amount of issues for the preceding month in coin, and three times the remaining half in bills or notes receivable in taxes. They offered if I would agree to these propositions, to go on and supply the army; but declared, that if I would not, they could no longer perform their engagements.

From this moment I was obliged to consider the contract as dissolved; because the dissolution of it appeared inevitable. I had already by entering into the contract, promised on the part of the public, a payment of the whole money due for the monthly issues. A new promise of the half would have given no additional security, and therefore I considered that stipulation as a request, that I should on my private and personal honor, assure them the public funds would enable me to make such payments. But of this I had no good prospect. The greater part of what little came in from taxes, was the same kind of paper with that which they asked for, being what I had long before issued for other services. If indeed I could have trusted the assurances made to me, I might have given the assurances required by them. But experience had taught me caution, and the event has shown, that if I had made the promise, I should now have been chargeable with falsehood.

I think the contractors were prudent in requiring a promise of indemnification; their situation made it necessary; but it was a promise which I could not make, for although I had reason to confide in their integrity and would have done it in my private capacity, yet as a public officer, I could not. For there would have been no longer certainty of the extent to which their expenditures might have been carried, after it should have become a matter of indifference to their private interest what prices should be given for supplies.

Thus, Sir, I found myself reduced to the alternative of making a new agreement for subsistence of the army and garrison, or of leaving them to subsist themselves by military collection. The latter was to be avoided, if possible, for it would have been the most expensive mode of obtaining supplies, not to mention other circumstances. The former, therefore, was to be adopted, and I accordingly gave instructions to Mr Cornell, the inspector of the contracts, to consult with the Commander in Chief, and take the necessary arrangements. It could not be expected, that a contract dictated by necessity, could be made on economical terms, and the inability to perform old engagements would necessarily influence the rate of new ones. Besides this, it was indispensably necessary to obtain a longer credit, because otherwise the burden would have been shifted, not removed; and the evil must have returned with equal speed and greater magnitude. Under such unfavorable circumstances, it was necessary to pay for a credit in order to obtain it. A new contract is made, and the rations issued now, are to be paid for three months hence, at the rate of thirteen pence, Pennsylvania currency, for a ration; which is an advance of about one third upon the former price. The public therefore will pay for this advance of moneys, equal to feeding the army at the rate of thirtythree and one third per cent for three months; or, to make the matter more simple, they must pay for feeding them three months, as much as would have fed them four months. Besides this, the public credit sustains material injury, and damages will be expected by the former contractors.

If, Sir, it should be supposed that this is the only instance of loss sustained from the low state of the treasury, it is a great mistake. The attempt to establish economical systems is vain, unless we can support them by punctuality. Congress have placed me in a situation where I am exposed in the first instance to claims and demands, but these must come home to the several Legislatures, and eventually to their constituents. My situation, therefore, makes it a duty to expostulate freely on the circumstances of my department. I am not to learn that free representations will sometimes give offence, and I know that those will be always most offended, who are most in fault; but I make no apologies for what I have to say. It is necessary that the truth should be known to the people; to our enemies it is known already, and has been for a long time. They hold up to contempt and derision the contrast between resolutions to carry on the war at every expense, and receipts of nothing in some States, and very little in all of them put together. Those who court public favor at the expense of public good, are very apt to inveigh against taxes, and to flatter the indolent and avaricious with the idea that war can be carried on without labor or money. But it is time for the people to distinguish between their flatterers and their friends. Sooner or later the current expense must be paid, and that payment must come from the purses of individuals. If it were made in season, it would be lighter by one half than it is. Congress have called for a certain sum, and that sum paid punctually would have answered the purpose, but they cannot be responsible for the consequences of delay. The expense will necessarily in such case exceed their calculations, and of course further sums must be required.

There are certain arguments, Sir, which ought not to be used if it is possible to avoid them; but which every one invested with public authority should suggest to his own mind, for the government of his own conduct. How long is a nation, who will do nothing for itself, to rely on the aid of others? In a war waged by one country to obtain revenue from another, what is to be expected in case of conquest? How long will one part of a community bear the burdens of the whole? How long will an army undergo want, in the midst of plenty? How long will they endure misery without complaint, injustice without reproach, and wrongs without redress? These are questions which cannot be solved by arithmetical calculation. The moral causes that may procrastinate or precipitate events, are hidden from mortal view. But it is within the bounds of human knowledge to determine that all earthly things have some limits, which it is imprudent to exceed; others, which it is dangerous to exceed, and some, which can never be exceeded. It is possible, that we are near the close of this war, and perhaps we are only in the middle of it. But if the war should continue, we have to blame ourselves; for were those resources called into action, which we really possess, the foreign enemies would soon lose all hope, and abandon their enterprize. The greater injury, therefore, which we sustain, is not from foreign, but from domestic enemies; from those who impede the necessary exertions. I have mentioned one among many instances, to show the consequences of withholding the public revenue, and I take the liberty to observe, that it would be more manly to declare at once, for unlimited submission to British tyranny, than to make specious declarations against it, and yet take the direct road to bring it about, by opposing the measures for our defence. That open declaration will doubtless be restrained by the fear of general resentment; but the other conduct is so much the more dangerous, as it is calculated to close people's eyes, while they approach the precipice, that they may be thrown down with greater ease and more absolute certainty.

I trust that your Excellency, and every other friend to our country, will urge forward that speedy and effectual collection of taxes, which can alone give vigor and stability to all our measures; and I risk nothing when I assert, that the public service shall be performed, (if the proper revenues be obtained,) at less than half of what would otherwise be expended.

I am, Sir, with perfect respect, &c.

ROBERT MORRIS.

TO THE GOVERNOR OF RHODE ISLAND.

Office of Finance, October 24th, 1782.

Sir,

My circular letter of the 23d instant, contains the estimates and requisitions for the service of the year 1783. I must take the liberty to make a few observations on them, which apply particularly to the State of Rhode Island. In the letters to Congress of the 29th and 30th of July last, copies of which were transmitted in my circular letter of the 12th of September, I have so fully expressed my sentiments on the subject of credit and loans, that I shall not repeat them. Your Excellency will perceive, that in the Act of the 16th instant, although the estimates amount to six millions, yet only two are required and that further requisitions are suspended until the result of measures for obtaining loans shall be known. It is unnecessary to mention, that Congress have directed an attempt to borrow four millions.

The propriety of this step will be self evident, when the date of their requisitions for the present year is considered. The sums brought in from the several States being regularly published in the gazettes, will spare me the pain of repeating them. I say the pain, because every such repetition will have, in some degree, the air of reproach. It must be remembered, that the duration of the war does not depend upon Congress. This is an invaded country; invaded for the purpose of conquest. And between opposition and submission there is no middle line. The idea of submission is, and ever ought to be, rejected with disdain. Opposition, therefore, becomes a matter of necessity; and that opposition involves expense.

There is then a certain degree of expense that cannot be avoided. And this must be provided for. The estimates being formed under the idea of money in hand to pay for services required, they are stated as low as possible. It appears, therefore, that the six millions mentioned in the estimates must be had. It appears from the experiments already made, that the people are either unwilling or unable to pay the whole in taxes; and whether want of power or inclination be the true cause, is immaterial to the present inquiry, for the fact is clear. Now there are but four modes of obtaining the supplies. Either they must be given to us, or lent to us, or raised by taxes, or taken by force. As to the first, we can place no dependence on it; and as to the last, it is neither the most constitutional, the most economical, nor the most pleasing way. Necessity may justify it, but it will be very difficult to justify the necessity. The supplies, therefore, must be obtained by loans or taxes; so that if they cannot be obtained by loans, taxation is the only resource; and in that case, there is no medium between legal taxation and military collection. For if we will not submit to Great Britain, we must carry on the war; and if we carry on the war, we must obtain the means; and if we cannot get the means abroad, we must provide them at home; and if we do not provide them by law, they must be taken by force.

The inattention of the States to the requisitions of the United States, leaves Congress no choice between loans and military collections. Whether they can obtain loans must depend upon other people. They cannot obtain loans without credit, and they cannot have credit without funds; and they cannot get funds without the concurrence of the States. They must ask that concurrence before they can obtain it, and they must determine on the funds before they can ask. The making yearly requisitions of quotas to pay the interest of public debts will not do. It is in itself a futile measure; but if it were the best thing in the world, yet if those who are to lend do not think so, there is an end of the matter. Now the fact is, that nobody will lend upon the promise of such requisitions. And truly the compliances made with those for carrying on the war, give very little encouragement. It follows then, that Congress must ask for particular funds. They have asked for one, and it is not complied with by two States out of thirteen. Shall Congress then adhere to the demand; or shall they change their application? If they should change it, could they expect that there would not then be one or two opposing States? To answer the question let it be inquired, what objects of taxation can be devised, to which exceptions cannot be made? Surely there are none.

Let it be inquired next, whether there is any object so unexceptionable as that which they have fixed upon? The answer is, no. It follows then, that in changing the application, there would be less prospect of success than at present. Congress then must adhere to their requisitions; and if that fund be not granted, we cannot expect loans. But it is demonstrated by experience, that we cannot get sufficient taxes. We certainly cannot get rid of the war, and therefore the people must have their property taken by force. The necessity will justify this. But as I said before, who will justify the necessity? Surely the authors of it should think of that in season.

Will it be a sufficient justification, to say that the demand of Congress is unconstitutional? If a thing be neither wrong nor forbidden it must be admissible. Such a requisition is nowhere forbidden, and therefore it is admissible if it be not wrong. Now it cannot be wrong to do that which one is obliged to do, be the act what it may. And Congress are obliged to make such requisitions. But further it must be admitted, that they are not contrary to the moral law. Supposing then, for argument's sake, that the thing asked for, would if granted be contrary to the confederation. If so, the grant would alter the confederation. But the grant is not to take effect without general consent. The confederation was formed by general consent, and by general consent it may be altered. The requisition, therefore, if complied with, will by that very compliance become constitutional.

But it may perhaps be suggested, that the five per cent impost will not be sufficient for the object in view. This must be acknowledged, but what inference is to be drawn from thence? Not that Congress should ask for more. Under the circumstances in which they are placed it is difficult to ascertain what line of conduct is to be pursued. If they ask further revenues it may be said, that there is weakness in framing new demands before old ones are complied with. Every fund will meet with some opposition, and every opposition encourages new opponents. The evil presses hard. Public credit is at the last gasp, or rather it is expired. Not only are we to expect a formidable clamor from the abused and injured creditors, but there is really very little hope of obtaining foreign loans. For how can it be expected, that a Republic without funds should persuade foreigners to lend them money, while its own citizens, who have already lent theirs, can neither obtain the interest, nor any solid security, either for interest or principal.

This, Sir, is an object of great magnitude, and one which directly or indirectly concerns every inhabitant of the United States. The critical situation we stand in, has rendered it necessary for Congress to demand a decided answer. No time is to be lost, for if the revenues cannot be obtained, the public creditors must be told so in plain terms. The efforts to borrow further sums must cease of course, and then the whole weight of the war must fall on the people, in one mode or the other. It is a very serious question, whether the little applause, which individuals may gain by specious declamations and publications should over balance every consideration of national safety. This serious and important question your Legislature is now, by the representatives of all America, most solemnly called on to decide.

I am, Sir, with perfect respect, your Excellency's most obedient and humble servant,

ROBERT MORRIS.

TO B. FRANKLIN.

Office of Finance. October 27th, 1782.

Sir,

I do myself the honor to enclose the copy of a paper transmitted to me by the Governor of Virginia. The clothing there mentioned is a part of those supplies for the State of Virginia, which the Court of France have charged to the United States. You will recollect the discussions on the subject. It is with a very sincere desire to remove every disagreeable trace of them, that I have agreed to a proposition made me by the Governor of Virginia, in his letter dated in Council Chamber on the 23d of September last, of which the following is an extract. "The regulations you have entered into for clothing the continental army will render useless to the State a quantity of necessaries now in France, furnished by his Most Christian Majesty; as the terms we have them on, which I have before transmitted to you, are such as will make the payment easy to the United States, we shall be obliged to you to take them off our hands, and take the debt so far as they go to the States. You will have a copy of the invoice enclosed, by which you will see, that they will be useful and necessary for the army, which will, I hope, induce you to oblige the State." The enclosed referred to, is that above mentioned. I make no doubt, that the Court will choose to consider the whole of these supplies as advanced on the credit of the United States. And therefore there is so much the less objection to taking a part of the goods. As for the remainder, I think it better for Congress to adjust the matter with Virginia than to plague the King's Ministers with altercations about it.

I am, Sir, your most obedient and humble servant,

ROBERT MORRIS.

TO THE GOVERNOR OF CUBA.

Philadelphia, November 27th, 1782.

Sir,

I do myself the honor to present to you Mr John Brown of this city, whom I have charged on the part of the United States with the negotiation of bills at your port, to the amount of two hundred thousand dollars. These bills will be drawn on Messrs J. L. & L. Le Couteulx & Co. at Cadiz. I have already taken the proper measures for placing in their hands the necessary funds. I presume that the actual state of things will render it as convenient (either to your Excellency on the part of the King, or to the merchants) to purchase bills, as it will be to the United States to sell them. The risk which attends sending of money to Europe, will probably have raised the exchange so considerably, as to compensate the risk of bringing it hither. This, I confess, is the principal reason with me for adopting this measure.

I shall highly esteem any favorable assistance, which your Excellency may be pleased to afford Mr Brown on this occasion; and I persuade myself that the intimate connexion of interests between his Catholic Majesty and my Sovereign during the continuance of hostilities against the common enemy, will be a strong inducement with you to promote the service of the United States.

With sentiments of the most perfect esteem, &c.

ROBERT MORRIS.

TO THOMAS BARCLAY, IN PARIS.

Office of Finance, December 5th, 1782.

Sir,

On the 28th of May last, the United States in Congress resolved, that a Commissioner be appointed to liquidate and finally settle the accounts of all the servants of the United States, who have been intrusted with the expenditure of public moneys in Europe. On the 29th of July last it was resolved, that the resolution of the 28th of May be reconsidered, and on motion it was ordered, that the said resolution be committed. On the 18th of November last, on the report of a committee to whom, upon a reconsideration the resolution of the 28th of May last was referred, it was resolved that a commissioner be appointed by Congress with full power and authority to liquidate and finally to settle the accounts of all the servants of the United States in Europe; and to commence and prosecute such suits, causes and actions as may be necessary for that purpose, or for the recovery of any property of the said United States, in the hands of any person or persons whatsoever. That the said commissioner be authorised to appoint one or more clerks, with such allowance as he may think reasonable; and that the said commissioner and clerks respectively take an oath, before some person duly authorised to administer an oath, faithfully to execute the trust reposed in them respectively. On the same day you were elected the commissioner, and it was resolved, that Congress would hereafter make adequate provision for the said commissioner, according to the nature and extent of the services which he shall perform. And on the 20th of November last it was resolved, that the Superintendent of Finance be directed to instruct the commissioner for settling the public accounts in Europe, to take proper measures for adjusting, without delay the accounts of M. de Beaumarchais, or Roderique Hortales & Co. and to report such settlement to Congress; that order may be taken for the payment of the balance, if any shall be justly due; and that, in the meantime, no farther remittances or payments be made to M. de Beaumarchais or Roderique Hortales & Co. by virtue of any former resolution of Congress.

Enclosed herein, you will find a commission authorising you to act in this business; and I shall now endeavor to give you such explanations and directions as may be necessary for the accomplishment of it, consistently with the views and intentions of the United States in Congress. You will undoubtedly remark, that no sum is fixed upon as the compensation for this duty; the reason of which is apparent, that until the completion of it, neither the nature nor extent can be perfectly known. This might, perhaps, have induced a monthly or annual stipend, to any other commissioner, but as your other duties may, and probably will, occupy a part of your time and attention, which must nevertheless be indeterminate, so it follows, that no points could be properly assumed, by which the reasonable extent of such a stipend could be known. I have reason to believe, that it is in the intention of Congress to make a generous allowance for the performance of this service; and I am persuaded, that by attention, assiduity and the faithful exertion of your talents and abilities, you will merit their regard.

The appointment of your clerks, as well as the ascertaining their number and reward, are left to your discretion. You will on this occasion consult the principles of true economy, which dictate the employing as many persons as are capable of performing the service and no more; the taking care that those employed are capable of performing the business committed to them, and the obtaining such a number of such persons, on the cheapest terms, for which they can be procured. But the worst economy in the world is, to employ improper men. That you may be enabled to form a judgment of the talents necessary to a clerk, you will observe that Congress in their ordinance of the 11th of September, 1781, for regulating the treasury and adjusting the public accounts, ordained and declared that the clerks, the number of whom should be regulated by the Superintendent of Finance, should be appointed by the Controller. That it should be their duty to examine all accounts which should be committed to them by the controller, to correct all errors, and to note in writing what may appear exceptionable, either as to the propriety of the charges or the validity of the vouchers, and transmit the accounts with their remarks to the auditor. And that the party for himself, and the clerk on behalf of the public should be heard before the auditor. From the nature of the commission intrusted to you, it follows that you must both commit the account to the clerk and afterwards audit it, as well as finally determine on and adjust it; which last is done here by the controller, except in cases where the appointment of a commissioner has been necessary, with authorities similar to yours. It is to be apprehended, that the accounts will, in many instances, be exhibited to you informally; and as it is not only useful in the first settling of complicated accounts to adhere to settled forms, but absolutely necessary to the clear and easy understanding of them after they are settled, so it will frequently become necessary to have the accounts restated, and all the vouchers of them numbered by your clerks. And although all your own care and attention will always be requisite to detect and discover errors and frauds, yet so much will depend on the accuracy and abilities of the clerks in these investigations, that I cannot too strongly recommend to your attention the choice of able accountants for that purpose.

With respect to the accounts of M. de Beaumarchais, much has been said, and therefore I might dispense, perhaps, with saying anything; but as I have reason to believe, that whatever may have been the character of the persons concerned, either for ability or integrity, the business which has passed through their hands has not been well done, I must desire that these accounts undergo your strictest scrutiny. You will probably find some other large accounts which merit a like attention. In every such case, the observations made here will be equally applicable. You are too well acquainted with mercantile business, not to know what, how, and when commissions are chargeable on a transaction. I believe that knowledge and information on this subject will be found very necessary. They will be indispensable should it be attempted to charge several commissions on the same thing, whether it be done openly, as such, or covertly, as brokerage, factorage and the like, or still more covertly, for increase of original price. Hence, therefore, it will be found necessary to consider well the original prices; and it is much to be lamented that samples of the articles cannot be laid before you, because many have been received of a quality not only base but despicable.

It is not possible at this distance of time and place, to ascertain by whom such articles were purchased, and indeed many of those which have been shipped have never arrived; under such circumstances it becomes your duty, to require proof of the quality of such articles as appear charged to the United States, and the idea will naturally suggest itself that the character of the party making the charge will influence the necessity of such proof, as the validity of the proof itself will be influenced by the character of the witnesses.

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.

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.

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.