Chapter M: De Calonne to M. De Lafayette (9)

On the whole, therefore, it may be proper to estimate the sums paid by them according to the rule already noticed, especially as the method of redeeming the old continental money formerly adopted, will, if pursued, work some degree of equality. For it will create a demand for the old money in those States, which, by the amount of their own emissions, have expelled it from themselves and forced it upon their neighbors. There must, however, be a distinction made in the advances of the several States; much of them has been for the pay and support of the militia, and much of that for the private defence of particular States, and of that again a part has frequently been unnecessary. To go, at this late period, into a close investigation of the subject, is impracticable, and perhaps dangerous. Neither would it answer any valuable purpose. Some general rule, therefore, must be adopted, and propriety seems to require, that credit should be given only for those expenditures on militia, which were previously authorised and required by express resolutions of Congress. With respect to all other articles, there is also to be noted a distinction between those which were furnished by the several States previously to the 22d of November, 1777, when the first demand of money was made, and those made subsequently to that period. I would propose that the former, as also the militia expenses not expressly authorised as above mentioned, should be taken together into one account, and the specie value of the whole estimated. That the amount of both, throughout America, should be apportioned by the same standard with the other expenses. And that the several actual expenditures of each State should be settled and liquidated with its proportional part of the whole, and the several balances carried to their respective debits and credits in the general accounts. These balances should bear interest at six per cent to the 18th of March, 1780. Thus, suppose the whole of those expenses should amount to one million of dollars, and that the State A be held to pay nine, and the State B ten parts out of every hundred; the State A would be accountable for ninety thousand dollars, and the State B for one hundred thousand dollars. And if it should appear, that the former had paid one hundred thousand, and the latter only ninety thousand, the former would be credited, and the latter debited ten thousand dollars, with six per cent interest.

I would propose, that the advances made by the several States, subsequent to the 22d of November, and prior to the 18th of March, 1780, excepting those to militia not authorised, should be estimated as aforesaid, and carried to account regularly upon the advances of money made to each from the Continental treasury, and the apportionment of the several demands made by Congress, in like manner with the moneys paid to their order. And that interest, at six per cent, should be charged or credited upon the several balances, until the 18th of March, 1780.

I would further propose, that on this day these balances, and those before mentioned, should be liquidated together, and the final capitals be considered as principal sums, bearing interest at six per cent. Thus, supposing the State A, in one account, to be credited ten thousand dollars, amounting, with interest, to eleven thousand, and debited in the other account five thousand, amounting, with interest, to six; in that case, the final balance, on the 18th of March, would be a credit of five thousand dollars.

On the 18th of March, we come to a new and more enlightened era of public accounts. The appointment formerly mentioned as preliminary to a settlement, will determine the quota due by each State for the two hundred millions of old Continental money, valued at forty for one. These resolutions of the 18th of March, 1780, not having been fully complied with, there appears to be a propriety in the following plan.

1st. To charge the several States with their proportions of it at that rate.

2dly. To fix some future day for the full compliance with the resolution.

3dly. To receive old paper at the rate of forty for one, in discharge of those proportions, until that day; and,

4thly. To charge the balances then unpaid in specie, with a debit and credit of interest at six per cent in the manner before mentioned.

I am sensible, that many persons now condemn the resolutions of the 18th of March, and among these are found some of those who warmly advocated it previously to that period. It is not my business to enter into arguments on the subject. Be those resolutions wise or unwise, they are acts of the sovereign authority, which have been obeyed by some, if not by all, and therefore those who have obeyed ought not to suffer by their obedience. They are acts for the redemption of bills issued by that sovereign, and they have formed the standard of public opinion with respect to those bills. If, therefore, for argument's sake, it were admitted, that the measure was impolitic and unjust, yet, now that it has taken place, there would certainly be both injustice and bad policy in altering it. The respective States have either obeyed it in the whole, or in part, or have totally neglected it. The first have a right to insist upon a compliance with it. The second must have so far accommodated themselves to it, as that interior mischiefs would arise from changing the system. And the last, whatever may be their claim to superior wisdom, will at least acknowledge, that the precedent of disobedience once established, our Union must soon be at an end, and the authority of Congress reduced to a metaphysical idea. Besides, the claim of such States must ultimately rest on the foundation of their own neglect; and as this will always be in their own power, it will be sufficient to rear any argument for any purpose.

By the resolutions of the 18th of March, 1780, ten millions of dollars of new paper were to have been issued, whereof four millions were to be at the order of Congress. By the resolutions of the 26th of August, 1780, three millions more were demanded. By the resolutions of the 4th of November, 1780, besides the specific supplies, an additional demand was made of one million, six hundred and fortytwo thousand, nine hundred and eightyseven and two thirds dollars in money; and by the resolutions of the 16th of March, 1781, six millions more are required. These sums amount in the whole to fourteen millions, six hundred and fortytwo thousand, nine hundred and eightyseven dollars and two thirds. A very small part of this sum has yet been paid; but admitting that there may have been circulated by the United States two millions, six hundred and fortytwo thousand, nine hundred and eightyseven dollars and two thirds, twelve millions would still remain due. If from this we deduct the whole of the new emissions, it would leave a balance of two millions. I propose, therefore, the following plan.

1st. That no more of these new emissions be used on any pretence.

2dly. That as fast as the old Continental money is brought in, the several States be credited for the new emissions to have been issued as specie, agreeably to the several resolutions of Congress upon that subject; and,

3dly. That on all those requisitions last mentioned, the money of the new emissions of any particular State be received as specie.

It is true that these propositions are liable to exception, but they have the great advantage of being consistent with former resolutions of Congress, which should always be attended to as much as possible. I am sure that Congress must be convinced of this, for they are not to learn, that authority is weakened by the frequent change of measures and pursuits; that such changes injure the reputation of supreme power in public opinion, and that opinion is the source and support of the sovereign authority. It is further to be observed, that the motives for complying with the resolutions of the 18th of March, will, if the above plan is adopted, become very strong; for in that case, every forty dollars of old Continental, paid by a State, will produce to the credit side of its account three dollars in specie; because in the first place, the whole proportion of old Continental being changed at forty for one, and receivable until a certain day at the same rate, that payment will so far operate a discharge of one dollar; and in the second place, it will entitle the State to two dollars of the new emission, which not being issued, will also be carried to its credit upon its several requisitions.

It will be in the wisdom of the United States, in Congress assembled, to determine whether after the expiration of the day to be fixed for the above purpose, they will permit the possessors of the old Continental money to bring it in loan at the rate of forty for one. It is true, that this might operate against those States, who have not complied with the resolutions of the 18th of March, 1780, and who have not now the old Continental to comply with it; but it is entirely consistent with the former resolutions of Congress, and the States are themselves blamable for the neglect. Besides, those who now hold the Continental do it either from choice, because of their confidence in Congress, or from necessity, because it has been poured in upon them from those places where it was of inferior value, and this inferiority was owing to the neglect of those States in not passing the laws which Congress recommended. There is, therefore, a degree of justice and firmness in that measure, which will create confidence in the future acts of the United States.

Whatever principles may be established for settling these accounts, and however just they may be, many doubts will arise in the application of them. It must always be remembered, that the States are independent; and that while they are pressed to a compliance with their duty, they must have full evidence, that Congress act fairly. It might therefore be proper, that for the settlement of their accounts, Commissioners should be chosen as follows; one by the State, one by the United States, one by the other two, and the decision of the majority to be final.

Hitherto I have taken no notice of the specific supplies called for from the several States. Many of these have been furnished, and many remain to be provided. I would exclude them entirely from the other public accounts; but as the apportionment so often mentioned, will give a rule to go by, I shall continue to press for the supplies; or where they are not wanted, make such composition with the States in lieu of those which remain to be furnished, as the public service shall render most eligible.

I have observed, that the public debts ought to be excepted from the apportionment of past expenses. The reason is clear. Those debts, or at least a great part of them, may subsist until the relative wealth of the States has entirely changed. Those who are now most rich, may become poor, and those who are poor, may become rich. This is not all; these debts are hitherto unfunded. The creditors have indeed the general promise of government, and some of them have certificates as evidences of that promise; but until measures are taken to provide solid funds for the final payment, the public credit must languish. To an enlightened mind, it is needless to debate on the advantages resulting from national credit. Congress will doubtless pursue the steps necessary for its perfect establishment. And this cannot be otherwise accomplished, than by raising taxes in hard money from sources which must be productive and increasing. Those taxes must be so bound to the public creditors for the debts due to them, that the produce cannot be diverted. These taxes ought to be raised from the same articles, at the same rates, and in the same manner throughout the whole confederation; and consequently, a present apportionment of the public debts will be as unnecessary as it would be unjust.

I think it my duty, while I am upon this subject, to mention my opinion, that in addition to the five per cent called for on articles imported, and on prizes and prize goods, it would be proper to appropriate to the payment of the public debts, a land tax, a poll tax, and an excise on spirituous liquors. I readily grant that neither of these taxes would be strictly equal between the States, nor indeed can any other tax be so, but I am convinced, that all of them taken together, would be as nearly equal as the fluctuating nature of human affairs will permit. I am, however, to observe in addition, that the land tax should be laid at a certain rate per acre, because the superior certainty of such a tax will give it the preference of others, although it cannot perhaps be so great as might have been expected. Whatever inequalities may remain, must be adjusted among individuals, by the several States in raising their quotas, and although those quotas will be most considerable during the war, yet it must be remembered, that after the conclusion of it, such sums will be necessary for the establishing a marine and other national purposes, as will still enable the States to continue their interior regulations for equalizing the general taxes.

Among the public debts, there are a considerable number of certificates given by public officers to the citizens of the several States for articles occasionally taken for the public use. With respect to these certificates, it is unnecessary to mention, that they have anticipated the revenue, and brought us to the brink of destruction. But it is time to pay a particular attention to them. Many ways may be fallen upon for their liquidation, all of which are perhaps justly exceptionable.

1st. They may be consolidated with the rest of the public debt, and be made payable at a future period; but this could only be by forcing a loan from the people, many of whom are unable to make it, and of consequence it would be a hard measure, if not an unjust one. Perhaps it could not be executed, for laws repugnant to the general feelings of mankind are only a dead letter. 2dly. Another mode is by receiving them in taxes, but this is very dangerous for several reasons, among which, the two following are cogent. The public revenue will not bear such a heavy deduction at those certificates would create, and the collectors of taxes would be liable to be defrauded themselves, or the remedy for that would give them opportunities of defrauding the public, which considering the natural bent and disposition of many men, ought to be carefully provided against. A third mode would be, by turning over the holders of these certificates to their respective States, and giving credit for them on account of the specific supplies. This may in some degree become necessary in cases where the negligence of the States on the one hand, and the necessities of the army on the other, have compelled to seize by force what ought to have been collected by law. But in many cases it cannot be done, and it would be improper in many others where it is practicable.

Among the bad consequences, which attend the present mode of supplying our armies, or rather leaving them to supply themselves, it is one of no small magnitude, that the officers who are compelled to the melancholy duty of plundering their fellow citizens, endeavor by the sum of their certificates, to compensate for the manner of taking as well as for the value of the thing taken. Nor is that all; where there is a disposition for fraud, an ample opportunity is afforded to commit it. Whatever may be the cause, I am informed, that these certificates are for sums vastly beyond the value of the services and articles obtained for them. The respective States would naturally be led to give to these certificates their specified value, and it cannot be expected that they will scrutinise them so rigidly as they ought, if they are to be accepted in discharge of demands existing against the particular State. To all these modes there are also some further objections. Among which it is my duty to state the following. The accounts of the several staff officers still remain unsettled. The certificates given by them, if they are to be paid by the public, ought to be carried both to the debit and credit of their cash accounts, and the articles obtained carried to their debit in the account of expenditures. Of consequence the amount of these last debits must depend much upon the amount of the certificates, and therefore either the certificates given should be known, and the accounts settled with those charges, or the account should be settled, and no other certificates allowed but such as are charged in it.

A further mode of liquidating these certificates would be, by purchasing them from the holders; but it is needless to state any other objections to it than the want of money, which is felt through all our operations. There still remains this method.

1st. That at present those certificates should neither be receivable in taxes nor transferable.

2dly. That they should be taken up and examined in the course of settling the public accounts.

3dly. That they should be brought to the amount in specie, which the article procured, or service performed, was reasonably worth.

4thly. That where the sum due to any person on certificates is small, a bill for the amount should be given, payable at the distance of a year.

5thly. That where the sum is large it should be divided into five different parts, and bills given payable in one, two, three, four, and five years, calculating on each part an interest of six per cent, and adding it to the amount. As if for instance, the sum were one hundred pounds, then the bills would be for twentyone pounds four shillings, twentytwo pounds eight shillings, twentythree pounds twelve shillings, twentyfour pounds sixteen shillings, and twentyfive pounds.

6thly. That these bills should be drawn payable to the bearer, and in such form as not to be counterfeited without great difficulty.

7thly. That they should be receivable in continental taxes, within any of the States, as cash, at the times when they are respectively due, or if not so received, payable by the continental treasurer, or any receiver of the continental taxes, on demand, after collecting the taxes, in which they were respectively receivable.

In this way a credit would be obtained not only without injury, but probably with advantage to the individual. The anticipation of the public revenue would not be very great, and, as a list of these notes would be kept, the amount of every year's anticipation would be accurately known. Exceptions may probably be found even to this mode, but unfortunately for us, we have only an alternative of difficulties. All which human prudence can do in such cases is to choose the least.

I have the honor to be, Sir, &c.

ROBERT MORRIS.

* * * * *

TO THE GOVERNOR OF MARYLAND.

Office of Finance, Philadelphia, }
August 28th, 1781. }

Sir,

Whilst I was at Head Quarters, near Dobbs's Ferry, the determination was taken by his Excellency the Commander in Chief, to send a very considerable force against the enemy's troops under Earl Cornwallis in Virginia; and immediately on my return hither, I did myself the honor to address your Excellency, respecting the specific supplies due from the State of Maryland to the United States, upon the requisitions of Congress, of the 25th of February and 4th of November, 1780, well knowing the whole balance due on these calls of Congress would, now become absolutely necessary to the intended operations.

I am very sensible that your government have upon all occasions executed demands of Congress with a decision and vigor, which does them honor, and on that account I should decline saying anything calculated to stimulate their present exertions, did I not know, that everything depends thereon. Virginia, North and South Carolina, have long subsisted large armies, and that expense of provisions must come to their credit. The New England States, New York, New Jersey, and Pennsylvania, have supported, and must continue to support, the main army. Pennsylvania will also contribute towards the support of the southern army, and her supplies will be directed both ways, as circumstances may require. Delaware and Maryland must chiefly be depended on. Virginia and North Carolina will, I hope, continue to do all they can. But your Excellency must be perfectly sensible, that I have not any funds wherewith to purchase supplies; no State in the Union has hitherto supplied me with money, except Pennsylvania. But as the money of that State is (in consequence of plans adopted for that purpose) very rapidly rising in value, it would be improper to call it into circulation at present, when it is at the rate of only two for one, though it has been as low as seven, because the public interest would thereby be injured, and indeed I might be charged with defeating the measures I myself had taken, in the very moment when they bid fairest for success.

The security of your State, the safety of individuals and their property are so immediately connected with the present operations, that I persuade myself your Excellency will receive every aid and support in your exertions, that you can wish, both from public bodies and individuals. My dependence therefore, on receiving the supplies from your State seems well founded.

I have the honor to transmit your Excellency herewith a letter from the Commander in Chief on the same subject, which will add weight to my entreaties. I have written to Donaldson Yeates, Quarter Master of the States of Maryland and Delaware, to procure immediately as many craft or vessels suitable for transporting the troops from the head of the Elk to Virginia, as will carry about seven thousand men, with the necessary provisions and apparatus. I have written to Mr Ridley, William Smith, and some others in Baltimore, to assist in procuring these vessels, and should any application to your Excellency be necessary on this subject, I persuade myself, that the authority of the government or weight of its influence will be brought in aid of the Quarter Master's endeavors to procure the shipping. I have also written to Mr Calhoun to know what part of the specific supplies he has ready, and what prospects for the remainder. He must bestir himself, as indeed must every person on whom the procuring of these articles depends.

While the demands for the campaign are constantly transmitted to me, and so much depends upon the measures I am constantly taking to economise the public funds and facilitate our military operations, your Excellency will perceive that full, early, and accurate intelligence upon the various objects of my Department is of the utmost importance. I must, therefore, reiterate my requests for it. To act from necessity and on the spur of occasion is not only the source of waste and extravagance, but frequently defeats plans otherwise the best concerted, while on the other hand, that timely forecast and early provision, which complete knowledge of circumstances can alone permit of, will save much public money, and go very far to insure victory to our arms.

I am, with great respect, &c.

ROBERT MORRIS.[42]

FOOTNOTES:

[42] _August 30th._ Went out to meet his Excellency General Washington, who arrived in this city about one o'clock, amidst the universal acclamations of the citizens, who displayed every mark of joy on the occasion. His Excellency alighted at the City Tavern, received the compliments of many gentlemen, who went out to escort him, and of others who came there to pay him their respects, and then adjourned to my house with his suit, Count de Rochambeau, the Chevalier Chastellux, General Knox, General Moultrie, and others, to dinner. The owners of several ships in the harbor ordered them out into the stream, and fired salutes, whilst we drank, The United States, His Most Christian Majesty, His Catholic Majesty, The United Provinces, The Allied Armies, Count de Grasse's speedy arrival, &c. &c. _Diary._

* * * * *

CIRCULAR TO THE GOVERNORS OF THE STATES.

Office of Finance, September 4th, 1781.

Sir,

I do myself the honor to enclose the plan of a National Bank, which I laid before the United States in Congress assembled on the 17th day of May last, and which was adopted by them on the 26th. I have now the pleasure to inform your Excellency, that an election for Directors will be held in this city on the 1st day of November next.

It is important that the execution of this plan be facilitated as much as possible, and particularly that of it which relates to the currency of the bank notes. The inhabitants of the United States already suffer from the want of a circulating medium. Of consequence the taxes must soon press heavily on the people. My feelings conspire with my duty in prompting me to alleviate those burdens. Therefore I pray the speedy attention of your Legislature to that resolution, by which the notes are to be receivable in payment of all taxes, duties, or debts due, or that may become due or payable to the United States.

I do not doubt either the credit or currency of bank notes, but I wish to render them equally useful to America in the individual as well as collective capacity, and to supply the necessities of the husbandman as well as the merchant. I shall not at present mention the other articles to be attended to; nor will I adduce any arguments in favor of my present proposition, as it is evidently calculated for the ease and benefit of the people you preside over. I hope, however, that your Legislature will not only pass the proper laws to make bank notes receivable in the manner mentioned in the resolution, but that it will be done soon.

With all possible respect, &c.

ROBERT MORRIS.[43]

FOOTNOTES:

[43] _September 5th._ The Commander in Chief having repeatedly urged, both by letter and in conversation, the necessity of advancing a month's pay to the detachment of troops marching to the southward, under the command of Major General Lincoln, and my funds and resources being at this time totally inadequate to make that advance, and at the same time answer the various demands that are indispensable, I made application to the Count de Rochambeau for a loan of twenty thousand hard dollars, for such time as his military chest could, without inconvenience, spare that sum, promising repayment at the time he should name.

I was desired to meet the Count at the Chevalier de la Luzerne's house, which I did on Wednesday the 5th instant, where I met the said Minister, Count de Rochambeau, and General Chastellux. They informed me of their strong desire to comply with my request, but that their treasury was at present not well filled, considering the daily drains upon it, and that although they had money arrived at Boston, it would require six or eight weeks to get it from thence, that although they expected money by the fleet of Count de Grasse, yet it was not then arrived, and of course that supply was less certain than the other; that the Intendant and the Treasurer were set out for the head of the Elk, and their consent was necessary however, they concluded this subject with requesting that I should ride down to Chester, where we should overtake those gentlemen, and if it were possible on consideration of all circumstances they would supply the money required.

General Washington was extremely desirous, that the troops should receive their month's pay, as great symptoms of discontent had appeared on their passing through this city without it. This affair being considered of great importance, I desired Mr Gouverneur Morris, my assistant, to accompany me, on account of his speaking fluently the French language. We set out at three o'clock for Chester, and on the road met an express from General Washington, who left us in the morning to join his troops at the head of the Elk, with the agreeable news of the safe arrival of Count de Grasse and his fleet in the Chesapeake. This news I received with infinite satisfaction on every account, and among the rest one reason was the facility it would give the French treasury in complying with my views, and this I found was actually the case, as Count de Rochambeau very readily agreed at Chester to supply at the head of the Elk twenty thousand hard dollars, to such person as I should appoint to receive them. I engaged to replace the same sum in their treasury by the 1st day of October next.

On Thursday forenoon I returned to this city about twelve o'clock having been impeded in my journey by meeting the last division of the French army, their artillery, and baggage on the road. On my return I immediately despatched Mr Philip Audibert, Deputy Paymaster General, to the head of the Elk, with orders to receive the money, pay the troops, &c. agreeably to instructions given him in writing. In the conferences with Count de Rochambeau and General Chastellux, they asked whether, if upon any occasion their treasury should stand in need of temporary aids, I thought they could procure loans in this city. I answered, that money is very scarce, that the people who have property generally keep it employed, and that no certain dependence can be placed on any given sums, but that I knew the people to be very generally disposed to assist our generous allies, and should such occasions offer, I was certain they would exert themselves; and as to my own part they might on every occasion command my utmost services, assistance, and exertions, both as a public officer, and as an individual. I mentioned to them again the affair of exchange, showing that they had reduced the price below what it had been raised to by my measures, and requested that in future when they expected to raise money by bills, they should in good time previously lodge them with the Minister, and that on his giving me timely notice, I would cause the most advantageous sale to be made of them, and deliver him the money without any other charge or deduction, than the expense of the brokerage.

I observed, that this mode of proceeding was now became essentially necessary, as there is no general market for bills of exchange to the southward, but that Philadelphia, in that respect, is as Boston to the eastern States. They answered, that they expected to procure their supplies with money, without occasion to draw bills, but if it happened otherwise they would pursue my advice. In regard to the articles of provisions, forage, wood, transportation, &c. necessary for their army, and which, when at camp, I had offered to procure for them on the same terms as for the continental army, by contract, I proposed to postpone that matter, as it might be best to continue their present method of supplies during the active scenes they are likely to be engaged in, as their Agents have given satisfaction, and are acquainted in the country where they are going, and that I could advertise for proposals to supply them the ensuing winter, and lay before them such offers or proposals as I should receive. This appeared very satisfactory, and here that subject rests for the present. _Diary._

* * * * *

TO THE COUNT DE ROCHAMBEAU.

Office of Finance, September 6th, 1781.

Sir,

In consequence of the conversation I had the honor to hold with your Excellency yesterday, and your promise to supply the United States with the sum of twenty thousand dollars, for an immediate purpose, to be replaced on the 1st day of October next, I have directed Mr Philip Audibert, the bearer of this letter, to wait upon you. I shall be much obliged to your Excellency if you will be pleased to direct, that the above sum be paid to Mr Audibert, and that duplicate receipts be taken of him, one of which I pray may be transmitted to me. I will take care that the money be replaced at the time agreed upon. With every wish for the most brilliant success to the allied arms, and for your own personal glory, I am, very respectfully, &c.

ROBERT MORRIS.

* * * * *

TO GEORGE WASHINGTON.

Chester, September 6th, 1781.

Dear General,

Permit me most sincerely to congratulate you on the arrival of the French fleet, and to express my warmest wishes for the success of your future operations.

As soon as I arrive at Philadelphia, I shall give directions for the Deputy Paymaster to repair to the head of the Elk, and make the payment of a month's pay in specie to the detachment under the command of General Lincoln. I wish the States had enabled me to do more, but it is to be lamented, that the supineness of the several Legislatures still leaves the servants of the public to struggle with unmerited distresses.

It shall, however, be a part of my business to rouse them into exertion, and I hope soon to see the army better paid than heretofore, and I confide, that your Excellency will, with every other public officer, exert your influence to aid me in this necessary task.

With the greatest respect, &c.

ROBERT MORRIS.

* * * * *

GEORGE WASHINGTON TO ROBERT MORRIS.

Head of the Elk, September 6th, 1781.

Dear Sir,

Every day discovers to me the increasing necessity of some money for the troops. I hope by this time you are provided to give a month's pay. I find it of the last importance to hasten forward myself to join the Marquis de Lafayette as soon as possible. I may leave this in a few hours; I cannot do it, however, without entreating you in the warmest terms to send on a month's pay at least, with all the expedition possible. I wish it to come on the wings of speed.

I am, Dear Sir, &c.

GEORGE WASHINGTON.

* * * * *

GEORGE WASHINGTON TO ROBERT MORRIS.

Head of the Elk, September 7th, 1781.

Dear Sir,

I have received your two favors of yesterday. I find myself so pressed by circumstances, that it will be impossible for me to stay at this place till the payment of the money committed to Mr Audibert can be effected. I must leave the head of the Elk this afternoon or early tomorrow morning. I shall however leave instructions with General Lincoln to do all that is necessary on the occasion.

The sum of twenty thousand dollars will fall much short of the sum necessary.

The five hundred guineas on my own account I have received.

I have the honor to be, &c.

GEORGE WASHINGTON.

* * * * *

TO GEORGE WASHINGTON.

Office of Finance, September 10th, 1781.

Dear Sir,

The sole intent of this is to acknowledge the receipt of your two letters of the 7th instant; that which related to the month's pay you would see was answered by the steps previously taken, but I am a good deal disappointed and put to inconvenience by the money at the Elk falling short of the object, which obliges me to send money thither that was absolutely necessary to fulfil my engagements here. I must struggle through these difficulties, but the doing so requires that attention and time, which ought to be bestowed upon greater objects.

The letter respecting the criminal was too late, the poor fellow was gone. I am sorry for it, and remain your Excellency's most obedient, &c.

ROBERT MORRIS.[44]

FOOTNOTES:

[44] _September 18th._ Several members of Congress and others called on me last evening, desirous to know the reasons for my writing to Mr Jay a letter of the 15th of August last, which being intercepted, Rivington has published, and graced with his remarks, wherein I direct Mr Jay to protest certain bills of exchange drawn by authority of Congress. The explanation is easily given, as the ship on board which I had remitted these bills was taken. The moment I knew her fate, I judged it proper to stop payment of the bills, lest the enemy, with their usual cunning, might attempt to procure the money; but I am now of opinion, that the Captain sunk them when captured. _Diary._

* * * * *

B. FRANKLIN TO ROBERT MORRIS.

Passy, September 12th, 1781.

Dear Sir,

I have received your letters of July 13th, 14th, 19th, and 21st, all at once, by way of L'Orient. The originals of those you mention to have sent by Major Franks are not yet come to hand, nor have I heard of his arrival in Spain.

Your letters of June 6th and 8th were remarkably lucky in getting to hand. I think I have received seven of the copies you had the precaution to send of them. I enclose copies of my answers.

I have now the pleasure to acquaint you, that I have obtained a promise of the sum I wanted to pay the bills I had accepted for the purchases made in Holland; so that your supplying me with remittances for that purpose, which I requested, is now unnecessary, and I shall finish the year with honor. But it is as much as I can do, with the aid of the sum I stopped in Holland; the drafts on Mr Jay and on Mr Adams much exceeding what I had been made to expect.

I had been informed, that the Congress had promised to draw no more bills on Europe, after the month of March last, till they should know they had funds here; but I learn from Mr Adams, that some bills have been lately presented to him, drawn June 22d, on Mr Laurens, who is in the tower, which makes the proceeding seem extraordinary. Mr Adams cannot pay these bills, and I cannot engage for them; for I see by the minutes of Congress you have sent me, that though they have stopped issuing bills drawn on the Ministers at Madrid, and the Hague, until they shall be assured that funds are provided for paying them, they have left open to be sold those drawn on their Minister at Versailles, funds or no funds; which, in the situation you will see I am in by the letters of the Count de Vergennes, terrifies me; for I have promised not to accept any drafts made on me by order of Congress, if such should be after the time above mentioned, unless I have funds in my hands, or in view, to pay them. After its being declared to me, that such bills could not be provided for, and my promise not to engage for them, it will be impossible to ask for the money, if I should accept them; and I believe those bills of Mr Ross must go back protested.

The projected loan in Holland has of late some appearances of success. I am indeed told it is agreed to by the States; but I do not yet think it so certain as to venture, or advise the venturing, to act in expectation of it. The instant it is assured, I will send you advice of it by every opportunity, and will, from time to time, send parts of it in cash by such ships of war as can conveniently take it.

I cannot write to you fully by this opportunity. I will not, however, delay acquainting you, that having the fullest confidence in your assurances of enabling me to pay them, I shall cheerfully accept your bills for four hundred thousand livres.

Captain Gillon has sailed from Holland, without taking under his convoy the two vessels that were freighted to carry the goods purchased by Captain Jackson, in Holland. There has been terrible management there; and from the confusion in the ship, before and when she sailed, it is a question if she ever arrives in America.

They are hard at work here, in providing the supplies to replace those lost in the Marquis de Lafayette.

With best wishes of success to you in your new employment, and assurances of every aid I can afford you, I am, Dear Sir, &c.

B. FRANKLIN.

* * * * *

TO M. DE LA LUZERNE.

Office of Finance, September 20th, 1781.

Sir,

His Excellency the Count de Rochambeau having generously made me a very considerable advance of money, I was thereby enabled to give the detachment of our army under General Lincoln, one month's pay, which was earnestly pressed upon me by the Commander in Chief. I promised M. de Rochambeau, that I would replace the sum borrowed, on the first of next month, wherever the army should then be.

The movement which lately took place to the southward, has been attended with a variety of expenses, which have been very heavy, and have absorbed all the money I could command, notwithstanding which many demands still remain unsatisfied, so that I cannot obtain the sums necessary for the service from any ordinary means.

As it is probable that the moneys which the Count de Grasse has brought, will prevent any immediate want by the fleets or armies of his Most Christian Majesty in the States of Maryland and Virginia, I am induced to believe, that no inconvenience would arise from delaying the payment, until the money in Boston shall be brought forward, which will be speedily, as a very active person has gone for it, who will lose no time in the business committed to him.

Should your Excellency be of this opinion, I shall be glad if you will signify it to me, and if that be in your power, that you will extend the time when payment is to be made. But if you think the money must be forwarded to Virginia immediately, you may depend that I will instantly endeavor to procure it, and although that cannot be done but with great difficulty and much loss, yet nothing shall deter me from complying with my engagements.

I have the honor to be, &c.

ROBERT MORRIS.

* * * * *

TO THE PRESIDENT OF THE COUNCIL OF PENNSYLVANIA.

Office of Finance, September 20th, 1781.

Sir,

I am honored with your Excellency's letter of this date, and most sincerely wish my situation was such as to justify a promise of aid, equal to the present necessities; I mean the necessities that will be created by the call of the militia at this time, but unluckily the late movements of the army have so entirely drained me of money, that I have been obliged to pledge my personal credit very deeply in a variety of instances, besides borrowing money from my friends, and advancing, to promote the public service, every shilling of my own. In this situation I was preparing an application to the honorable Council and Assembly for relief from my advances, from the State of Pennsylvania, and this will be the more necessary, as this alarm whilst it lasts will cut off all possibility of recruiting the treasury. Those who possess hard money will keep it, and those who have demands will become more eager for payment, therefore, all I can promise is the use of my credit, and an exertion of any influence I may have in favor of such measures as may be deemed necessary. At the same time I do not recede from my first opinion, that the enemy do not meditate any attack on this city.

I have the honor to be, &c.

ROBERT MORRIS.[45]

FOOTNOTES:

[45] _September 21st._ At one o'clock I waited on the President of the State of Pennsylvania, at his house in Market Street, and met there Mr Peters and Mr Cornell, of the Board of War, General St Clair, General Irvine, and General Irwin, of the militia. This conference lasted a considerable time, and in its consequences took up the rest of the day. I gave it as my opinion, that Sir Henry Clinton did not intend for this city, nevertheless, as the inhabitants are alarmed and uneasy, I agreed to the propriety of being prepared, although I lamented the expense such preparations would put us to. I advised the placing a garrison at Mud Island, and putting that place in a posture of defence, and mentioned the plan proposed to me by Mr Paine, of collecting immediately one quarter's rent from all the houses in Philadelphia, in order to have an immediate supply of money to defray the expenses, &c. _Diary._

* * * * *

TO M. DE LA LUZERNE.

Office of Finance, September 25th, 1781.

Sir,

I received last night your Excellency's billet requesting to be informed of the amount of the bills drawn by me; as Superintendent of the Finances, on Messrs Le Couteulx & Co. of Paris, under the sanction of your engagements.

This communication I intended making to your Excellency in consequence of the conversation that passed between us a few days since; but it was only yesterday that I completed the delivery of such bills as had been sold previous to that conversation, which amounted to fiftyseven thousand seven hundred and eighty livres; and now on summing up the whole I find, that I have drawn one hundred and eightyone sets of bills, all at sixty days' sight, in favor of various persons to whom they have been sold, amounting to nine hundred and one thousand and eighteen livres, four sous, and eight deniers tournois; of these bills three hundred and seventysix thousand one hundred and twentytwo livres, ten sous, have been sold at five shillings and six pence for five livres, and five hundred and twenty four thousand eight hundred and ninetyfive livres, fourteen sous, eight deniers, at six shillings for five livres; by which it appears the discount does not exceed sixteen and five eighths per cent on the value in Europe; and were this money to be imported I suppose the freight and insurance might amount to nearly the value of that discount; if so, this mode of bringing it into use is not a bad one. Besides I must again observe, that by a union of management in the sale of bills drawn for the service of his Most Christian Majesty's fleets and armies, and those drawn for account of the United States, still better prices might be obtained, nay, I should not despair of trying to raise the price of exchange to par, by means of partial importations of money, and passing bills before the expenditure thereof, so that necessity might not have any influence in fixing the price.

What your Excellency has said to me respecting the advances made this year by his Majesty to the United States, has left on my mind those impressions you intended to make. You may depend, Sir; that it is my wish, and shall be a part of my study, to render these States as little troublesome to his Majesty as possible, and I shall probably have many opportunities to convince you, that it is a fixed point with me, that the United States, to become truly independent, must trust more to their own exertions, and lean but lightly on their allies. But, Sir, you must remember the situation, in which I found their affairs; you are not ignorant, that although I have cut off entirely many sources of expense, and curtailed others, yet that I have not been able to obtain either supplies of money or permanent revenue from the States, which however I attribute chiefly to the recess of the several Legislatures during the greatest part of the time that I have been in office, for I hope and expect that they will severally attend to the calls upon them, when they shall come to know their real situation.

But in the meanwhile, what am I to do if the means of supplying indispensable wants are cut off? The important operations now carrying on by General Washington depend so materially on the performance of my engagements, that the most fatal consequences may ensue from any breach of them. Your Excellency well remembers, that you thought yourself justifiable, in giving me assurances, that Messrs Le Couteulx & Co. should be supplied with one million five hundred thousand livres tournois, to answer my drafts to that extent; the produce whereof to be employed in the service of the present campaign. You will also recollect, that previous to my journey in August to camp, I judged it necessary to know, whether that sum was the whole on which I could place dependence, because, as the General's operations would in a great measure depend on the aids I could afford him, it was absolutely incumbent on me to be informed of their extent in every channel, through which I expected them to flow.

Your Excellency, convinced of the propriety of my observations, and of the actual necessities of our situation, ventured the assurance of another million of livres. Therefore, whilst I was at camp, during the consultations on the measures, I gave his Excellency reason to believe, that the amount of two millions five hundred thousand livres of bills on France, in conjunction with the resources provided by Congress, should be brought to the support of his operations. Counting upon this as certain, General Washington has taken his measures accordingly.

It has been my study to make the bills as productive as circumstances would permit, and to apply the money to the purposes for which it was granted, under the most scrupulous and assiduous attention to the principles of economy, and I may hazard the opinion, that no money has been more frugally or usefully expended by the United States during the war, without the least danger of being put in the wrong.

You are sensible that the money which arrived with Colonel Laurens, although landed on the Continent, cannot be brought into use until its arrival here; and although I have sent for it, yet it is but now on the road, and the General cannot stop his operations, nor can I refuse or defer compliance with my engagements until its arrival. The ruinous consequences that would follow, must appear too strong and clear to a gentleman of your reflection and information, to need any other demonstration than the bare mention of the facts. Consequently your Excellency will be well convinced of the absolute necessity of permitting me to draw to the extent agreed upon, and I hope his Majesty's Ministers will be too strongly impressed with apprehensions of the fatal consequences that would follow any neglect of my bills, to suffer the least inattention to them; and as the sum in total will not be of such magnitude as to occasion great inconvenience, I hope his Majesty will find cause to applaud your zeal and attention upon the occasion.

A committee of Congress have laid before me the communications your Excellency has lately made to Congress, which will claim my utmost attention, and your Excellency will do me the justice to believe that my most strenuous endeavors shall be to promote what is so strongly urged by his Majesty's Ministers, the most spirited exertions of these States to drive the enemy from our country. And that my affection for, and gratitude to France, are unalterably fixed, as is also my respect and esteem for your Excellency's person and character. Being, Sir, your most obedient, &c.

ROBERT MORRIS.

_P. S._ Upon a more exact calculation of the sale of bills, a few of which were sold a little higher than the rest, I find that nine hundred one thousand and eighteen livres, four sous, eight deniers, produced fiftytwo thousand two hundred and eleven pounds, ten shillings and ninepence, Pennsylvania currency; which is equal to one hundred twentyfive thousand three hundred and seven French crowns, and seven tenths of a crown, at eight shillings four-pence, Pennsylvania currency, for a crown; and the same number of livres reduced into crowns at six livres each crown, is one hundred fifty thousand one hundred sixty-nine and four sixths crowns. Consequently the discount is little more than sixteen and a half per cent.

* * * * *

TO THE SPEAKER OF THE ASSEMBLY OF PENNSYLVANIA.

Office of Finance, September 28th, 1781.

Sir,

As the Honorable House of Assembly are now sitting, and have before them the several letters which I had the honor to write during their recess to his Excellency the President in Council, I shall now endeavor to state, in a short manner, the situation of accounts depending between Pennsylvania and the United States, and propose such measures, as, I think, will lead to a speedy and satisfactory settlement of them.