Chapter XLVIII: Introduction (47)

He argued that the authority given to the PRESIDENT in the subject put it in his power to draw the whole fourteen millions to this country, if he thought fit; it could not, therefore, he contended, be insisted, that the amount of the drafts had passed the limits of the authority given. It is not denied, he proceeded, that there was a right to draw for the two millions appropriated for the reduction of the public debt. Well, it has appeared, on a certain occasion to the House, that our Minister in France negotiated a contract with the National Assembly, or their officers, for the payment of $800,000 of the debt due them, here; then certainly, the exigency of the case required that this sum should be drawn here for the purchase of provisions for St. Domingo, in which this payment was to be made. Here then was a positive necessity of drawing for $2,800,000 and as a discretionary power in the subject had been left to the Executive, they might have found it advisable, perhaps, under an expectation of additional payments in the same manner to have drawn over as much more as they might have thought prudent.

He adverted to the application of the Secretary to the Legislature to declare whether the loan obtained, for an interest of five per cent., exclusive of douceurs, might be considered as borrowed under authority of the $2,000,000 act. It was his (Mr. BOUDINOT's) opinion at the time, that no explanatory law was necessary; and that the Executive had power to construe the act in that sense. This was also the Secretary's opinion, and in consequence of that opinion he had drawn bills. He thought it however right to apply to the House and have every doubt removed, and the Legislature sanctioned his construction of the law.

It had been said, that if the Legislature had a right to confirm, they also had a right to reject the construction put upon the law by the Executive. This, he conceived, they would not have been warranted in doing, after a contract agreeably to that construction had been made; such a proceeding must have involved a breach of contract.

It had been repeatedly asserted and strenuously insisted on, that the Legislature were totally in the dark, as to the drafts from Europe. To disprove this assertion, he read several items from sundry reports of the Secretary, where sums received on account of loans are specified. It had also been said, that there was no evidence that any part of the loan was applied to or intended for the purchase of the public debt.

This also appears unfounded, from a note dated 25th of August, 1790, laid before the Trustees for purchasing the public debt, which expressly mentions, that a loan had been negotiated, part of which was destined for the purchase of the public debt, and that some points relative thereto were before the PRESIDENT for his approbation. This also showed that the PRESIDENT had knowledge of such intentions. His Speech, and the Report of the Secretary, in consequence of part of that Speech, which had been so repeatedly referred to, also unequivocally prove this point.

He recapitulated the heads of his arguments, and concluded, that if nothing further could be brought in support of the charges now before the committee, they should have his decided negative.

Mr. MADISON.--He wished not, he said, to waste a moment of the small portion of time left, by regretting its insufficiency for a full discussion of the subject before the committee. But he thought it due to truth, and to the honorable and independent motives of his colleague (Mr. GILES) in proposing the resolutions, to remark, that the lateness of the day to which they had been postponed did not justify the strictures which had been made on it. If the delay was not to be considered as unavoidable, some blame, at least, would fall elsewhere. The inquiries in which the whole matter originated, had been moved by his colleague, and passed the House some weeks ago. The reports in answer to these inquiries had not been finally made and printed a single day before the present resolutions were submitted to the House. He admitted that it might have been impracticable to report the information called for, as early as was desired by the House. He was sensible of the anxiety that would be naturally felt by the officer called upon, to present every consideration that might place his conduct in the most favorable point of view; yet, with all these allowances, it was impossible to deny that the reports contained things which did not belong to them, and therefore consumed time which, belonged to the period for discussion. He would mention one instance on which there could not possibly be a difference of opinion, viz: the vindication, formally undertaken by the Secretary, of the policy of borrowing money abroad. Whether his policy was right or wrong, the Legislature had themselves decided in favor of it; and it was the duty of the Secretary, in complying with the orders of the House, to inform the House how the law had been executed--not why it had been made; to explain his own conduct,--not to justify that of the Legislature.

It had been asked why the call for information had not been sooner made? The answer was obvious and simple. It was not sooner perceived by the House, that there was such a necessity for it. The want of information was first suggested by the bill for paying $2,000,000 to the Bank, although $200,000 only were immediately due, and for authorizing another foreign loan to the amount of $2,000,000. From the dawn of light thrown by some circumstances incident to the occasion on the darkness in which the House had remained, proceeded those doubts and inquiries which had led to the information now possessed. His colleague had great merit in having brought about this development. He had rendered a service highly valuable to the Legislature, and no less important and acceptable to the public. One good effect of the information had been, that it prevented the passage of the bill for borrowing $2,000,000 as an anticipated payment to the Bank. The bill had dropped from the hand of its patron with the first light that broke in upon the House. What other measures would have been prevented or varied, if a like knowledge of our funds and finances had been sooner obtained, was matter of serious consideration.

Another consequence of the reports, taken together, was, that the face of them presented to his colleague an evidence of the charges contained in the resolutions. Whether, at so late a day, it was best to leave the subject as exhibited by the various documents in print, for the examination and opinion of the public, or to press it on the consideration of the House, was a point which every member had a right to decide for himself. His colleague had viewed the positions stated in his motion as too important to be suspended, and as supported by such clear and authentic proofs, that a small portion of time would suffice for the subject. Under this impression, what was his right became his duty; and he had discharged it by offering his resolutions to the House.

As the House had refused to commit the two introductory resolutions, which established the rule of judgment to be applied to the case, and the last also, which declared the inference to be drawn, the task of the committee was limited to a simple inquiry into the facts stated. They were to make out and report a special verdict of these, and leave it to the House to pronounce the proper judgment arising from them.

The resolution immediately before the committee imported, "that the Secretary of the Treasury had violated the law passed on the 4th of August, 1790, making appropriations of certain moneys," first, "by applying a certain portion of the principal borrowed to the payment of interest on that principal;" secondly, "by drawing part of the same moneys into the United States, without the instruction of the PRESIDENT."

The questions here are questions of fact; and whatever quality may be attached by different gentlemen to the several facts, it would seem as if the facts themselves are too clearly supported by the Reports of the Secretary, and the documents attending them, to be denied or controverted.

The law of August 4, 1790, authorized the PRESIDENT to cause to be borrowed $12,000,000, to be applied to the Foreign Debt of the United States. A subsequent law of August 12, 1790, authorized another loan of $2,000,000, to be applied to the Domestic Debt of the United States. A power to make these loans was delegated, on the 28th of August, 1790, to the Secretary, by a general commission, in the usual form, referring to the several acts above mentioned, but without any further discrimination of the loans to be made. As the law, however, for applying loans to the foreign object was prior in date, the presumption would rather be that it was to have a priority of execution; that the first money borrowed was to belong to the first object provided for. It was unnecessary, however, to dwell on this consideration, because the PRESIDENT had removed all uncertainty by the precise explanations and instructions which accompanied the power to the Secretary, and which ought, in truth, to be deemed a part of the commission. The instruction having been more than once read to the committee, he would content himself with referring to it.

The part referred to is in the following words:

"I do hereby make known to you on the execution of the said
trust, you are to observe and follow the orders and
directions following, viz: Except where otherwise
especially directed by me, you shall employ in the
negotiation of any loan or loans which may be made in any
foreign country, William Short, Esq.; you shall borrow, or
cause to be borrowed, on the best terms which shall be
found practicable, and within the limitations prescribed by
law as to time of repayment and rate of interest, such sum
or sums as shall be sufficient to discharge, as well all
instalments or parts of the principal of the foreign debt,
which are now due, or shall become payable to the end of
the year 1791, as all interest and arrears of interest
which now are, or shall become due, in respect to the said
debt, to the same end of the year 1791. And you shall
apply, or cause to be applied, the moneys which shall be so
borrowed, with all convenient despatch, to the payment of
the said instalments, and parts of the principal and
interest, and arrears of interest of the said debt. You
shall not extend the amount of the loan which you shall
make, or cause to be made, beyond the sum which shall be
necessary for completing such payment, unless it can be
done upon terms more advantageous to the United States,
than those upon which the residue of the said debt shall
stand or be. But if the said residue, or any part of the
same, can be paid off by new loans, upon terms of advantage
to the United States, you shall cause such further loans as
may be requisite to be made, and the proceeds thereof to be
applied accordingly. And for carrying into effect the
objects and purposes aforesaid, I do hereby further empower
you to make, or cause to be made, with whomsoever it may
concern, such contract or contracts, being of a nature
relative thereto, as shall be found needful and conducive
to the interest of the United States."

By this formal act, issued along with the commission to the Secretary, the PRESIDENT designated the object to which the loans to be made were to be applied; and by declaring the object to be that provided for by the act of August 4, 1790, he expressly placed the loan under the authority and provision of that act; so that the moment the money should be borrowed, it was to stand legally appropriated to its specified object--as much as if another law authorizing another loan for another purpose, had not existed.

This arrangement of the PRESIDENT was the more proper, not only because provision for the payment of the foreign debt had been the primary object of the Legislature, and the payment of the French debt the anxious wish of their constituents, but because payments to France were no longer matter of option, but of strict and positive obligation on the United States. In proof of this, he stated that the debt of France, calculated to the end of 1791, and computing the livre at 5 4-10 to a dollar, amounted to $4,814,814, whilst the payments actually made, computing the florin at 2-1/2 to a dollar, amounted to more than $3,372,717, leaving, as a balance, at the end of 1791, $1,442,097. Adding to this balance the instalments due for 1792, amounting to $638,888, there were to be paid within that year $2,080,985. The entire payments, however, composed of $656,500 in Europe, and $726,000 put to the account of St. Domingo, (although $444,263, 83 were actually paid,) amounted to $1,382,500, leaving due at the end of 1792, a balance of $698,485.

Here Mr. M. adverted to and read a paragraph in the Report of the Secretary, page 16, where in allusion to the measure of drawing bills in the latter part of 1792, he says: "I feel myself the more at liberty to do it, because it did not interfere with a complete fulfilment of the public engagements in regard to the foreign debt. It could be done consistently with a full reimbursement of all arrears and instalments which had accrued on account of that debt."

Mr. M. observed, that, as he could not reconcile this paragraph with the calculations which he had stated, and which were drawn from official documents, he must regard it as an unquestionable error, produced by some hasty view of the subject.

Returning to the commission, Mr. M. repeated that all the money which that instrument, defined and qualified by the instruction annexed to it, authorized the Secretary to borrow, was actually and specifically appropriated to the payment of the foreign debt, and under circumstances particularly urgent, in relation to a part of it.

In what manner had this trust been carried into execution? It was to be observed, with regret, that, on the very day on which the commission and instruction issued from the President, the Secretary commenced his arrangement for diverting part of the loan, accepted and ratified by virtue of his commission, to a purpose different from that specified and required by his instruction. That a fact of so extraordinary a complexion might be grounded on the most unexceptionable proof, Mr. M. said he should take the liberty of supporting it by the authority of the Secretary himself. Here he read from the Secretary's letter, dated August 28, 1790, to the Dutch houses from whom the loan had been accepted, the following passages, viz:

"I should also wish, for particular reasons, that the
business may be so regulated as to give it the form of two
loans--one for two millions under the first act, and the
other for one million under the second. But neither about
this am I so solicitous as to be willing that it should
constitute an embarrassment."

"I destine a million and a half of this sum as a payment to
France, under the direction of Mr. Short, our Chargé
d'Affaires at that Court, whose orders for that purpose you
will please to follow."

The aspect here presented by a comparison of the several documents, was singular and remarkable. The subordinate officer appeared in direct opposition to the Chief Magistrate. The agent was seen overruling, by his own orders, the orders of his principal. The language of the President was, "By virtue of the power vested in me by law, I destine the money to be borrowed to the discharge of the instalments and interest of the foreign debt." The language of the Secretary was: "I destine a part of the money only to that purpose, and a part to be brought to the United States for other purposes." He left every member to make his own reflections on the subject. He would only observe, in general, that it demonstrated the truth asserted in the proposition, that the Secretary had violated both the law of August 4, 1790, and the instruction of the President relating to it.

He then proceeded to a more distinct view of the two points particularly stated in the resolution. The first was, "That a certain portion of the principal borrowed under the act of August 4, 1790, had been applied to the payment of the interest falling due on that principal." As the fact would not, he presumed, be denied, he forebore to quote that part of the documents which admitted and authenticated it. He would, however, premise to any observations on it, a cursory view of the nature of appropriations.

It was unnecessary to repeat the emphatic remarks on this subject, which had fallen from the member from Pennsylvania, (Mr. FINDLAY.) It was sufficiently understood. He concluded that appropriations of money were of a high and sacred character; that they were the great bulwark which our constitution had carefully and jealously established against Executive usurpations. He meant only to take notice of the different plans into which appropriations might be moulded, and of the particular operation which ought to be given to them.

One of the plans was that of appropriating specified funds to specified objects, in which the supposed certainty of the funds was adjusted to the supposed importance of the objects.

The other plan formed all the branches of revenue into an aggregate fund, on which the several objects should have a priority of claim according to their superiority of importance. It was evident that in both these cases, the Legislature alone possessed the competent authority. The exclusive right of that department of the Government to make the proper regulations, was the basis of the utility and efficacy of appropriations.

There was a third question incident to the doctrine of appropriations, viz: Whether, under specific appropriations, such as had been adopted by Congress, the Executive authority could, without special permission of the law, apply the excess of one fund to the aid of a deficient one, or borrow from one fund for the object of another. On this question, there might perhaps be a difference of opinion. He would only remark, that, admitting such a discretion to be implied in the trust of executing the laws, it would still be requisite that the due sanction of the Executive should be given, that a regular account should be kept between the different funds, and that all advances from one to the other should be replaced as soon as possible. This was equally necessary to the preservation of order in the public finances, and to a proper respect for the authority of the laws.

In the present case, it did not appear that the moneys taken at different times from the loans designated by the President, and thereby placed under the appropriation of the act of August 4, 1790, to the foreign debt, had ever been replaced. It did not appear that any such replacement was regularly planned or provided for. It was particularly worthy of observation, moreover, that the only use within the United States for which any loan in Europe could be assigned, was that of the Sinking Fund; that the Trustees of this fund had never been even informed of the drafts; that if the moneys drawn had been carried to the Sinking Fund, the limited sum of $2,000,000 would have been exceeded; and that the statements and accounts had, in fact, been so wound up, as mentioned by the Secretary, that not a single dollar of the money laid out in purchasing the public debt had been charged on loans drawn into the United States, although such was the only purpose to which they were legally applicable, and such the principal reason assigned for making the drafts.

He did not go into a particular proof that the sum drawn into the United States, after subtracting the whole sum placed to a foreign account, exceeded the sum of $2,000,000, because the fact had been conceded on the other side, particularly by the statement of the member from Connecticut, (Mr. HILLHOUSE.)

Thus it appeared clearly, in confirmation of the first point, that the application of a certain portion of the principal borrowed in Europe, to payment of the interest, was not a mere transposition of moneys, to prevent the sending them backwards or forwards, nor an advance of money from an overflowing fund in favor of a deficient one; but an absolute diversion of appropriated money, and consequently a violation of the law making the appropriation.

The second point in the resolution related to the drawing of moneys into the United States without the instruction of the President. This point had been fully established by the documents and explanations applied to the first. They had done more: they had demonstrated that the instructions of the President, which dedicated the loans to be made under his commission to a foreign object, were an express prohibition of drafts for any domestic object. It was sufficient, therefore, to refer to the instructions of the President, and to the contradictory steps taken by the Secretary. Two attempts had been made to elude the force of these official proofs. The first appealed to the President's Speech at the opening of the session in 1790; to the Report of the Secretary, made in consequence of it, to the House; and to the supplementary act of Congress passed in conformity to the Report.

Had the circumstances involved in this transaction been attended to by those who seemed to rely on it, Mr. M. was persuaded that a reference to it would never have been made by gentlemen on that side. As they had thought fit, however, to draw arguments from that source, it was proper to give an answer to them; and the best answer would be a naked statement of facts.

The instruction of the President to the Secretary was given, as has been seen, on the 28th of August, 1790. The letter of the Secretary contravening this instruction, was dated, as has also been seen, on the same 28th day of August, 1790. The actual drawing of bills by the Secretary commenced the 15th of December, 1790. The law now pleaded in justification of the conduct of the Secretary, passed on the 3d of March, 1791.

There are other facts material to a correct and full view of the subject. The Speech of the President was delivered on the 8th of December, 1790. It briefly informed the two Houses that "a loan of 3,000,000 of florins, towards which some provisional measures had previously taken place, had been completed in Holland," and "that the Secretary of the Treasury had discretion to communicate such further particulars as might be requisite for more precise information." The consequent Report of the Secretary, recommending the provision in the supplementary act, was not received till the 25th of February, 1791--six days only before the constitutional dissolution of the House. In the interval between the Speech of the President and the Secretary's Report, he had proceeded to draw bills to the amount of 793,392 florins. His report, notwithstanding what had been said of it, contained not a word from which it could be known that a single florin had been actually drawn over to the United States.

The other attempt to elude the evidence before the committee, recoiled with equal force on the gentlemen who had hazarded it. In the report lately made by the trustees of the Sinking Fund, is a statement laid before them by the Secretary, in which it is noted "that the acceptance of the loan of 3,000,000 of florins, and the application of one-third of it to the purpose of that fund, was under the consideration of the President." From this fact, it had been inferred, not only that the Secretary had withheld no proper information from the Trustees, but that the result of the President's deliberations on the subject had varied the purpose signified by his first instructions to the Secretary.

It happened, however, most unfortunately for the gentlemen who exulted in this argument, that they had entirely overlooked the dates of the two papers. The paper laid before the Trustees, and alleged to have explained the final purpose of the President, was dated on the 25th of August, 1790. The paper relied on by the other side, as the final, as well as the most formal, designation of the will of the President, was dated the 28th of August, 1790. The gentlemen, therefore, instead of the inference they had made, should have reversed their premises, and joined with their opponents in concluding that the President was led by a consideration of the subject, not to do what the Secretary, in his note to the Trustees, seemed to anticipate, but what had been evinced by the President's own act of posterior date.

The second point, then, as well as the first, rests on the most solid proofs, taken from a collective view of authentic documents.

Much has been said on the necessity of sometimes departing from the strictness of legal appropriations, as a plea for any freedoms that may have been taken with them by the Secretary. He would not deny that there might be emergencies, in the course of human affairs, of so extraordinary and pressing a nature, as to absolve the Executive from an inflexible conformity to the injunctions of the law. It was, nevertheless, as essential to remember, as it was obvious to remark, that in all such cases, the necessity should be palpable; that the Executive sanction should flow from the supreme source; and that the first opportunity should be seized for communicating to the Legislature the measures pursued, with the reasons explaining the necessity of them. This early communication was equally enforced by prudence and by duty. It was the best evidence of the motives for assuming the extraordinary power; it was a respect manifestly due to the Legislative authority; and it was more particularly indispensable, as that alone would enable the Legislature, by a provident amendment of the law, to accommodate it to like emergencies in future.

In the proceedings falling under the present inquiry, no necessity appeared for the liberties which had been taken, the money appropriated in Europe being more wanted there than at home. It appeared that the instructions of the Supreme Executive, instead of warranting those liberties, had precluded them; nor had the proper explanations been disclosed in due time to the Legislature. To place the subject in a more distinct point of view, it was proper to advert to the precise authorities and duties of the Secretary, as his office is defined by the act establishing the Treasury Department. For this purpose, Mr. M. read the second section of that act, which is in the words following:

"That it shall be the duty of the Secretary of the Treasury
to digest and prepare plans for the improvement and
management of the revenue, and for the support of public
credit; to prepare and report estimates of the public
revenue and the public expenditures; to superintend the
collection of the revenue, to decide on the forms of
keeping and stating accounts and making returns, and to
grant, under the limitations herein established, or to be
hereafter provided, all warrants for moneys to be issued
from the Treasury, in pursuance of appropriations by law;
to execute such services relative to the sale of the lands
belonging to the United States as may be by law required of
him; to make report and give information to either branch
of the Legislature, in person or in writing, (as he may be
required,) respecting all matters referred to him by the
Senate or House of Representatives, or which shall
appertain to his office; and generally to perform all such
services relative to the finances as he shall be directed
to perform."

This establishment of the office evidently had no reference beyond the case of superintending the regular and ordinary collection of the revenue, and granting warrants for moneys issued from the Treasury, in pursuance of appropriations by law. The case of loans, as an occasional and extraordinary resource, was left to be provided for by particular laws for the purpose. The authority, with respect to the loans in question, was accordingly committed to the PRESIDENT, in order to secure for so special a trust, the highest responsibility to be found in the Government. And when it was considered that the whole sum contemplated was no less than fourteen millions of dollars, and when the latitude as to the terms and contracts was combined with the vastness of the sum, it might well be questioned whether so great a power would have been delegated to any man in whom the Legislature and the people of America had less confidence than they so justly reposed in the existing Chief Magistrate, and whether an equal power will ever be committed to a successor. This distinction between the case of ordinary revenue and that of loans is not only consonant to the actual policy of our laws, but is founded in obvious and solid considerations. In the collection and disbursement of the ordinary revenues arising from taxation, the business flows in official channels, is subject in every stage to official checks, and the money, being in constant influx and efflux, nowhere accumulates in immense sums. The case of loans is, in all these respects, different. In settling the terms and arranging the negotiations, there is always an important discretion involved. When the loans are foreign, as well as great, regulations concerning the bills of exchange form another occasion where great latitude is implied in the trust; whilst the magnitude of the sums, falling under the same direction at the same moment, present a further and material variance between the two cases. The tendency of these observations is to show that, as the permanent law establishing the Treasury Department does not extend the authority of the Secretary to the case of loans and as the law authorizing loans exacts, for special reasons, a responsibility from the PRESIDENT himself, the authority of the Secretary, in executing the loans, and the appropriation of them, must be derived from the PRESIDENT; and, consequently, where that authority fails, there can be no resort to the law establishing the department, much less to any general discretion incident to his official character. It is evident that the PRESIDENT, although no doubt guided by the most proper considerations in employing the agency of the Secretary of the Treasury in the business of the loans, might, if he had judged fit, have substituted the agency of another; and that, whatever agency he might prefer, his own instructions would always regulate the extent and exercise of the power conferred. The want of any apparent authority from the PRESIDENT had led several gentlemen to insist on presumed authorities, superseding the instructions joined with the commission to the Secretary. But here, again, the fair inference was to be reversed. A communication of the authorities given by the PRESIDENT to the Secretary, as to the application of the foreign loans, had been expressly requested by the vote of the House. It was not to be supposed that the Secretary, if he had received further authorities or instructions, would have failed to produce them, or to refer to them, in the justification of his conduct. Far less could it be presumed that the PRESIDENT, if he had given any superseding authorities or instructions, would not have caused them to be communicated to the House, or that he would have suffered a partial communication to mislead the House into an error as to so important a fact. The PRESIDENT was the last man in the world to whom any measure whatever of a deceptive tendency could be credibly attributed.

Thus far (said Mr. M.) his observations had departed as little as possible from the question in its strictest sense. He should now avail himself of the opportunity afforded by the terms of the last clause, which spoke of drafts generally, to take a more particular notice of those recently made; in doing which, he considered himself safe within the Rules of the House, which were so rigorously enforced against the affirmative side of the question. The whole amount of foreign loans transferred directly or indirectly to the United States appeared from the several statements to be about $3,000,000. The amount of the direct drafts was $2,304,769 13. Of the drafts made since the 16th of April, 1792, and sold by the bank, the proceeds now in the bank, or payable into it, before the 1st of April next, amount to $1,220,476 01. Of this sum $510,000 have been drawn in the course of the present session in Congress. With respect to the times and the amount of these drafts, hitherto absolutely unknown to the Legislature, because the account of them had remained in the books of the bank without ever appearing in the books of the Treasurer, Mr. M. confessed that he had found no explanations that were satisfactory to him. He had looked through all the reports and all the communications before the House, without discovering either that they had been made by the authority or with the knowledge of the PRESIDENT, or had been required for, or applied to the purchase of, the public debt, or had been ever communicated to the Trustees of the Sinking Fund, who had the direction of such purchases, or that they were the effect of any necessity that could justify them. And if there was no evident necessity for the proceeding, it was the more to be lamented that, whilst we were every where sympathizing with our allies in their arduous struggles for liberty, and echoing, from every part of the Union, our congratulations and good wishes, the pecuniary succors so critically necessary to their cause, and the most substantial proof of the sincerity of our professions, should be silently withdrawn across the Atlantic from the object for which they were intended--succors, too, which were not merely a tribute of gratitude, of generosity, or of benevolent zeal for the triumph of liberty, but a debt moreover of strict and positive obligation, for value acknowledged and received. In contemplating the subject in this point of view, he felt a pain which he could not easily express, and to which, he persuaded himself, the breast of no other member could be a stranger. Laying aside, however, all these unfavorable considerations, the important question still remained, why the Legislature had been uninformed of the moneys so unexpectedly drawn into the bank, and to so very great an amount? If the drafts had received every requisite sanction, if they had been produced by the most justifiable causes, the existence of $1,220,476, in a situation so different from what had been contemplated, was a fact which the Representatives of the people had a right to know, which it was important to them and their constituents that they should know, and which it was the indispensable duty of the officer charged with it to have made known. This omission was the more remarkable when considered in relation to the measure above mentioned, of paying off at once the whole sum of $2,000,000, payable to the bank by instalments in ten years. A bill for this purpose had been introduced, and was on its passage; the object of it had been patronized by a report of the Secretary not long since made. In one of his last reports he expressly states, among the inducements to such extensive drafts of money from Europe, that they were made "with an eye to placing within the reach of the Legislature" the means necessary for this object. Was it not extraordinary, was it not unaccountable, that so important a measure should be recommended, and be actually introduced, and that money otherwise appropriated in Europe should be transferred to this country and deposited in the bank, in order that it might be within the reach of being applied by the Legislature to that measure, and yet that no disclosure should be made to the Legislature of that fact that the money was so drawn and lay at the bank, within their reach, to be so applied? If any thing could heighten astonishment on this occasion, it must be the reason assigned by the Secretary for any obscurity that might have hung over our finances--"that, till the last resolutions, no call had been made on the department which rendered it proper to exhibit a general view of the public moneys and funds, or to show the amount and situation of such as were unapplied." Mr. M. would not decide that the Legislature was free from blame in not using more full and efficacious means of obtaining such information as would have removed all obscurity. But, whatever degree of blame might fall on them, it never could be admitted that their calls on the department had furnished no proper occasion for exhibiting a full view of the public finances. He referred generally to the various resolutions, which, without the least force of construction, would have extended to every proper article of information. He reminded the committee of the latitude of reports under certain other orders of the House, and asked whether less freedom of construction was to be allowed when information was to be given, than when power or discretion was to be exercised? But independently of this view of the matter, Mr. M. held it to be clear and palpable that the very situation of the money afforded an occasion which rendered it proper that the House should be informed of it. If a liberty could be taken of removing money from Europe, where it stood appropriated by law, to this country, where there was no legal object that required it, and with an eye, as was stated, to an object to which no money was applicable, without the authority of the Legislature, how could it possibly be supposed improper to take the further liberty of communicating what was done to the Legislature? He concluded with recurring to the particular form in which the subject presented itself to the committee, and repeating that, whatever quality might be attached to the facts charged, or however improper it might be thought by some to proceed in haste to any affirmative decision on them, it appeared irreconcilable with the evidence which had been produced, to decide, by a negative vote, against the truth of the facts.

Mr. AMES prefaced his remarks on the subject before the committee by some observations on the nature of the charges brought forward. He was happy that they were determinate, and conceived that the defence could be crowded in a nutshell. As to the first charge in the resolution immediately before the committee, he had seen no proof in support of it brought forward. It is founded only on assertion, and he conceived that contra-assertion was sufficient to meet it. No authority, it was said, was given to the Secretary to obtain the loan under the blended authority of both acts. This is not one of the charges included in the resolutions before the committee, and therefore this is not the time to answer it. However, if this were fact, nothing criminal could in consequence be imputed; and, since the purposes of both laws were carried into execution, there could be no ground for saying that either was violated. He said much on the impracticability of the line of conduct which some gentlemen appeared to think ought to have been followed by the Secretary. It was impossible to keep different funds, differently appropriated, so inviolably separate as that one might not be used for the object of the other; all was right, he conceived, provided what was taken was to be replaced. He was also of opinion that the overflowing of one fund could be applied to make up the deficiency of another; and that all that is necessary is to give priority to the appropriation. The money paid in Europe for interest on the loan was said to have been improperly applied, because the fund appropriated for the purpose was here. He insisted that that money was absolutely represented here by an equal sum: and he contended that, though the interest was not paid in the identical coin appropriated, yet, by allowing a very reasonable latitude of expression, it could be said that the interest was paid with the money appropriated, for the applicability of the sums there depended on the existence of the fund here. He next turned to the second charge in the resolution; and, after showing that the natural presumption was, that the Secretary either was instructed or had a discretionary power, he then vindicated his conduct in respect to the drafts of money to this country. He did honor to the motives of the gentlemen who had instituted the inquiry, and concluded an elegant speech, by a contrasted picture of our former and present situation as a country, dwelling upon the importance of preserving harmony, and insisting on the danger of giving rise to suspicions against a highly responsible officer, and of bringing forward charges not to be supported by proof.

Mr. FINDLAY.--If my hopes respecting the Government have not been equally elevated with those of the gentleman from Massachusetts, (Mr. AMES,) neither are my apprehensions so much depressed with fears. But I hope I am equally anxious for the stability and prosperity of the Government; and though we differ in opinion on this question, yet I am firmly persuaded that the part I take is the best calculated to promote the necessary confidence in Government, and secure the virtue of its administration. As the gentleman, in an elegant discourse, has explained no difficulties, nor adduced any proofs in support of his opinions, I will only add, that I believe the Government to be so well established, and so much beloved by the citizens, as not to be endangered by the House of Representatives' examining how the laws have been obeyed in the application of public money, and giving their opinions upon the result of that examination.

That the Secretary has not reported fully to this House, in due time, is so much within the knowledge of every member, that it is impossible to doubt of the truth of the fact, however we may differ about the propriety of the conduct. To go no further back than last session--besides the references to the Secretary to report upon the Ways and Means, and inform the House what revenues were necessary, on the 20th of February, 1791, a standing order was resolved, directing that he should report to the House, within a few days after the meeting of the next session, "an accurate statement and account of the receipts and expenditures of all the public moneys, in which shall be distinguished the expenditures which fall under each head of appropriation, and that it shall be shown the sums, if any, which remain unexpended," &c. Were not the moneys drawn upon loan, _public moneys_, and were not those loans appropriated? Undoubtedly, they were strictly so. It is a strange evasion to say, that by these expressions only the current revenue is intended. Arguments must be scarce when this becomes necessary. It requires no refutation.

On the 19th of January last, he was called upon to "lay before the House such information with respect to the finances of the United States, as will enable the Legislature to judge whether any or what additional revenues will be necessary." In consequence of the recommendations of the PRESIDENT, and the wishes of this House, to commence the discharge of the redeemable part of the Funded Debt, a reference was made to the Secretary, requiring him to report a mode for the application of the public money for that purpose; the House being assured, by the gentleman who moved the resolution, that no new tax was intended or necessary. But the Secretary, so far from informing the House how much money he had subject to his discretion, in the bank, in notes, &c., proposed a new and partial tax, as the foundation of a new system of loans. When the memorable bill to authorize another loan of $2,000,000, was before the House, a few weeks ago, we were told by gentlemen on this floor, that there was not time for argument; that the bill must be passed in three or four days, &c.; and when we wanted information, we were told by some of the friends of the bill that it was not convenient to give information there--that we might procure information elsewhere, as they had done. I confess I did not comprehend this method of legislating; but the Secretary has since explained it, in one of his reports, by complaining of the House, because the members did not go to his office and ask information, instead of requiring it to be publicly reported.

Even when this favorite bill for a new loan was before the House, the Secretary did not condescend to inform us that he had, without authority, provided near a million and a half of dollars for that purpose; he did not inform us how obligingly he had drawn bills upon our bankers in Holland, to have the money put in our way. Thus, in order to anticipate the payments due to the bank, he did what he could to induce Congress to break the public faith, by repealing the existing appropriation made for securing the discharge of a debt of justice and gratitude to the French nation. From this and other instances, it appears, that however high the Secretary's regard for public credit may be, there are other considerations which have obtained a higher degree of his attention than obedience to the laws. The gentleman from Virginia (Mr. MADISON) has so clearly explained the nature of that discretion with which the Secretary is vested, and so fully proved that there was no necessity to justify a departure from the appropriations made by law, that it is not necessary for me to explain further on this head. However, I cannot help remarking, that the discretionary powers were pretty freely exercised. The drawing of bills began early indeed, and was continued to a recent period. The times of drawing fortunately corresponded with the necessities of the bank, and the power of employing agents was pretty freely used. The same agents were frequently both the sellers and the purchasers of the bills. Perhaps this was necessary: no doubt it was convenient. Probably it was safe; but who can say it will be always so.

I have not said so much to prove the truth of the facts expressed in the resolution, for of this there can be no doubt--it is as clear as the sun, shining in daylight,--but, in order to prove the propriety of this committee expressing its disapprobation of a conduct so unjustifiable. That information was withheld unduly, is evident, from the lateness of this discussion; that it was obtained with difficulty, is evident, from the numerous applications we were obliged to make in order to obtain it.

The House then adjourned until seven o'clock post meridian.

EVENING SESSION--7 P.M.

An engrossed bill making certain appropriations therein mentioned was read the third time, and passed.

The bill sent from the Senate entitled "An act providing for the compensation of Ebenezer Storer," was read twice and committed.

_Official Conduct of the Secretary of the Treasury._

The House again resolved itself into a Committee of the whole House on the third, fourth, fifth, sixth, seventh, and eighth resolutions contained in the motion of Thursday last, respecting the official conduct of the Secretary of the Treasury. The third resolution being still under consideration, in the words following, viz:

"_Resolved_, That the Secretary of the Treasury has
violated the law passed the 4th of August, 1790, making
appropriations of certain moneys authorized to be borrowed
by the said law, in the following particulars, viz: First,
by applying a certain portion of the principal borrowed to
the payment of interest falling due upon that principal,
which was not authorized by that or any other law.
Secondly, by drawing a part of the said moneys into the
United States, without the instructions of the President of
the United States."

A motion was made, and the question being put, that the House do agree with the Committee of the whole House in their disagreement to the resolution, it was resolved in the affirmative--yeas 40, nays 12, as follows:

YEAS.--Fisher Ames, Robert Barnwell, Egbert Benson, Elias
Boudinot, Shearjashub Bourne, Benjamin Bourne, Jonathan
Dayton, Thomas Fitzsimons, Elbridge Gerry, Nicholas Gilman,
Benjamin Goodhue, James Gordon, Christopher Greenup, Samuel
Griffin, William Barry Grove, Thomas Hartley, James
Hillhouse, William Hindman, Philip Key, Aaron Kitchell,
John Laurance, Amasa Learned, Richard Bland Lee, George
Leonard, Samuel Livermore, Frederick Augustus Muhlenberg,
William Vans Murray, Nathaniel Niles, Theodore Sedgwick,
Jeremiah Smith, Israel Smith, William Smith, John Steele,
Samuel Sterrett, Jonathan Sturges, George Thatcher, Thomas
Tudor Tucker, Artemas Ward, Hugh Williamson, and Francis
Willis.

NAYS.--John Baptist Ashe, Abraham Baldwin, William Findlay,
William B. Giles, Andrew Gregg, Nathaniel Macon, James
Madison, John Francis Mercer, Andrew Moore, Alexander D.
Orr, John Page, and Josiah Parker.

A motion was then made, and the question put, that the House do agree with the Committee of the whole House in their disagreement to the fourth resolution, in the words following:

"_Resolved_, That the Secretary of the Treasury has
deviated from the instructions given him by the PRESIDENT
OF THE UNITED STATES, in executing the authorities for
making loans, under the acts of the fourth and twelfth of
August, one thousand seven hundred and ninety."

It was resolved in the affirmative--yeas 39, nays 12, as follows:

[The same as above.]

Another motion was then made, and the question being put, that the House do agree with the Committee of the whole House in their disagreement to the fifth resolution, in the words following:

"_Resolved_, That the Secretary of the Treasury has omitted
to discharge an essential duty of his office, in failing to
give Congress official information, in due time, of the
moneys drawn by him from Europe into the United States;
which drawing commenced December, one thousand seven
hundred and ninety, and continued until January, one
thousand seven hundred and ninety-three; and of the cause
of making such drafts:"

It was resolved in the affirmative--yeas 33, nays 15, as follows:

YEAS.--Fisher Ames, Robert Barnwell, Egbert Benson, Elias
Boudinot, Shearjashub Bourne, Benjamin Bourne, Jonathan
Dayton, Thomas Fitzsimons, Elbridge Gerry, Nicholas Gilman,
Benjamin Goodhue, James Gordon, Thomas Hartley, James
Hillhouse, William Hindman, Philip Key, Aaron Kitchell,
John Laurance, Amasa Learned, George Leonard, Samuel
Livermore, Frederick Augustus Muhlenberg, William Vans
Murray, Theodore Sedgwick, Jeremiah Smith, William Smith,
John Steele, Samuel Sterrett, Jonathan Sturges, George
Thatcher, Thomas Tudor Tucker, Artemas Ward, and Hugh
Williamson.

NAYS.--John Baptist Ashe, Abraham Baldwin, William Findlay,
William B. Giles, Samuel Griffin, William Barry Grove,
Richard Bland Lee, Nathaniel Macon, James Madison, John
Francis Mercer, Andrew Moore, Nathaniel Niles, John Page,
Josiah Parker, and Israel Smith.

Another motion was then made, and the question being put, that the House do agree with the Committee of the whole House in their disagreement to the sixth resolution, in the words following:

"_Resolved_, That the Secretary of the Treasury has without
the instruction of the PRESIDENT OF THE UNITED STATES,
drawn more moneys, borrowed in Holland, into the United
States, than the PRESIDENT OF THE UNITED STATES was
authorized to draw, under the act of the twelfth of
August, one thousand seven hundred and ninety, which act
appropriated two millions of dollars only, when borrowed,
to the purchase of the public debt; and that he has omitted
to discharge an essential duty of his office, in failing to
give official information to the commissioners for
purchasing the public debt, of the various sums drawn from
time to time, suggested by him to have been intended for
the purchase of the public debt:"

It was resolved in the affirmative--yeas 33, nays 8, as follows:

[Yeas as above.]

NAYS.--John Baptist Ashe, Abraham Baldwin, William Findlay,
William B. Giles, Nathaniel Macon, James Madison, John
Francis Mercer, and Josiah Parker.

Another motion was then made, and the question being put, that the House do agree with the Committee of the whole House in their disagreement to the seventh resolution, in the words following:

"_Resolved_, That the Secretary of the Treasury did not
consult the public interest, in negotiating a loan with the
Bank of the United States, and drawing therefrom four
hundred thousand dollars, at five per centum per annum,
when a greater sum of public money was deposited in various
banks, at the respective periods of making the respective
drafts:"

It was resolved in the affirmative--yeas 33, nays 8, as follows:

[Same as above.]

Another motion was then made, and the question being put, that the House do agree with the Committee of the whole House in their disagreement to the eighth resolution, in the words following: