Chapter IV: Part 4

[2] _January 7th._ This day the National Bank of North America
opens to transact business. This institution I am persuaded will
flourish under the management of honest men and honest measures.
The present directors are such men, and the present system of
measures are founded in principles of justice and equity.
Therefore, I shall most cheerfully assist all in my power, to
establish and support this Bank. And as a beginning, I have this
day issued my warrant on the treasury for two hundred thousand
dollars in part of the shares, which I have subscribed, on behalf
of the public. _Diary_

* * * * *

CIRCULAR TO THE GOVERNORS OF THE STATES.

Office of Finance, January 8th, 1782.

Sir,

I have the honor to transmit herewith an ordinance passed by the United States in Congress assembled the 31st day of December, 1781, incorporating the subscribers of the Bank of North America, together with sundry resolutions recommending to the several States to pass such laws as they may judge necessary for giving the said ordinance its full operation. The resolutions of the 26th of May last speak so clearly to the points necessary to be established by those laws, that I need not enlarge on them. Should anything more be found necessary upon experience, the President and Directors will no doubt make suitable applications to Congress, or to the States respectively, as the case may require.

It affords me great satisfaction to inform you that this Bank commenced its operations yesterday, and I am confident that with proper management, it will answer the most sanguine expectations of those who befriend the institution. It will facilitate the management of the finances of the United States. The several States may, when their respective necessities require, and the abilities of the bank will permit, derive occasional advantages and accommodations from it. It will afford to the individuals of all the States a medium for their intercourse with each other, and for the payment of taxes more convenient than the precious metals, and equally safe. It will have a tendency to increase both the internal and external commerce of North America, and undoubtedly will be infinitely useful to all the traders of every State in the Union, provided, as I have already said, it is conducted on principles of equity, justice, prudence, and economy. The present directors bear characters, which cannot fail to inspire confidence, and as the corporation is amenable to the laws, power can neither sanctify any improper conduct, nor protect the guilty. Under a full conviction of these things, I flatter myself, that I shall stand excused for recommending in the strongest manner, this well meant plan, to all the encouragement and protection, which your State can give, consistently with wisdom and justice.

I have the honor to be, &c.

ROBERT MORRIS.

* * * * *

TO THE GOVERNOR OF RHODE ISLAND.

Office of Finance, January 14th, 1782.

Sir,

The delegates of Rhode island did me the honor to communicate your Excellency's letter of the 24th of last month, directed to them. I have carefully considered that letter, and now, agreeably to my promise made to them, shall endeavor to convey my sentiments upon it to you. You mention, Sir, that the Assembly unanimously concluded, that the sum of two hundred and sixteen thousand dollars, called for by Congress, to be so large as that it could not by any means be raised in specie, and you say, further, that the scarcity of cash has become uncommonly great.

By the Acts of Congress on that subject, you will perceive the amount of taxes called for by the United States, to be eight millions of dollars. I cannot pretend to say, that the apportionment has, or has not been equal; but I am persuaded it is as nearly so as the information, which could have been obtained, would by any means admit. The whole sum, Sir, however large it may appear, is very much short of our former annual expenditures; and, I am sorry to add, that it is certainly short of what will be necessary, even with the strictest economy. I am compelled on this occasion to observe, that the want of credit is now materially felt. Other free nations find infinite relief from the oppressive weight of taxation by anticipating the public revenue; but we, with every advantage from nature to prevent it, are obliged to bear now those burdens, which ought, in reason, to be divided with succeeding generations. To obtain credit, we must provide funds amply sufficient, not only to pay the interest of all former debts, both foreign and domestic, but also sufficient to liquidate those, which we may find it necessary in future to contract. These funds must be permanent, clear, sufficient, and at the disposition of Congress. Nothing short of that will answer the purpose.

In the meantime, the interest of our debt is as great as if such funds were given; and to pay that interest will cost as much to the people; but the complaints from every quarter, until it be provided for, do infinite injury. Whereas, if funds were granted, we might from time to time obtain loans, both at home and abroad, sufficient to defray a great proportion of our annual expenditure. You will easily perceive what relief the people would feel from paying the interest instead of the principal. As to the want of money, your Legislature must consider, that there must always be such want from the very nature of things, because nothing gives to money its value, but the universal desire of obtaining it; and, of consequence, the ease with which all the necessaries, conveniences, and luxuries of life are obtained in exchange for it. It is the value of money, which has induced all wise nations to raise the supplies in coin, rather than in produce, because there is nothing, which so facilitates the economy of public resources. And the great object of a wise and just government is, to reduce as low as possible the burdens, which the people must bear, for their own preservation, safety, and advantage. The want of money always has been, and now is complained of throughout the United States. This want will, however, be soon remedied in some degree by the bank paper; and further, it must be remembered, that as the public wants will call for an expenditure faster than the collection of taxes will take place, those taxes will by no means decrease the general circulating medium, and if that medium be, as is said and as I really believe, deficient, commerce will continue, as at present, to increase it by the daily importation of specie from abroad.

The taking of specific supplies has, by experience, been found unequal to the object, and is extremely wasteful and expensive. Many articles produced in the several States, in themselves very valuable, will by no means admit of transportation; and even those, which will admit of it, can seldom be brought to the place where they must be consumed, but at an expense which, in many instances, exceeds the original value.

I am convinced, nevertheless, that there is force in your observation, on the propriety of expending within the State as much of the revenue drawn from it as can consist with the general interest of the Union. This, Sir, must, nevertheless, depend in a great degree upon the cheapness with which your citizens will furnish such things as the public may want. While they industriously make and cheaply vend those things, which the necessities of mankind require, they need not apprehend a want of money; for as, on the one hand, he will get most of a commodity, who will give for it the most money; so, on the other, he will get the most money who will give for it the most of a commodity. Your honorable delegates inform me, that many articles fit for our use, and in particular blankets and woollen stockings, are manufactured in your State, and can be afforded to the United States on good terms. If so, it is very probable, that not only the revenue called for may be expended there, but even a greater sum. I will give orders to the Clothier General to make inquiries immediately as to the quantities and prices of articles proper for his department in your State; and to purchase, if they can be had upon proper terms.

As to making any agreement for specific articles, I cannot undertake it, because I have already made contracts for most of the articles, which we may want, payable in money; and I am too distant to judge of prices; nor is it possible for the human mind in that complicated scene, which engrosses every moment of my time, sufficiently to attend to such minute details. The business of government must be simplified, in order that it may be well conducted, and to do this is with me a very principal object. Your Excellency will perceive, that I am authorised to appoint a Receiver of the Continental taxes within the several States, and I shall make the appointment within your State very speedily. I have every disposition to comply with your wishes, and will give such instructions to the Receiver, as that he may from time to time facilitate the views of the Legislature and lighten the burdens of the people, which I sincerely assure your Excellency is an object that lies nearest my heart.

I have the honor to be, &c.

ROBERT MORRIS.

* * * * *

TO THE PRESIDENT OF CONGRESS.

Office of Finance, January 15th, 1782

Sir,

Finding by the Act of the United States in Congress of the 7th instant, that I am instructed to prepare and report a table of rates, at which the different species of foreign coins most likely to circulate within the United States shall be received at the Treasury, I have been induced again to turn my attention to an object, which has employed my thoughts very frequently, and which would have been long since submitted to Congress, had I not been prevented by other business, and much delayed by those things relating to this business, which depended upon others. I shall now pray leave to deliver my sentiments somewhat at large on this subject.

The United States labor under many inconveniences and even disadvantages which may at present be remedied, but which, if suffered to continue, would become incurable, and lead to pernicious consequences. It is very fortunate for us, that the weights and measures used throughout America are the same. Experience has shown in other countries, that the efforts of the legislator to change weights and measures, although fully seconded by the more enlightened part of the community, have been so strongly opposed by the popular habits and prejudices, that ages have elapsed without producing the desired effect. I repeat, therefore, that it is happy for us to have throughout the Union the same ideas of a mile and an inch, a hogshead and a quart, a pound and an ounce. So far our commercial dealings are simplified and brought down to the level of every capacity.

With respect to our money, the case is very widely different. The ideas annexed to a pound, a shilling, and a penny, are almost as various as the States themselves. Calculations are, therefore, as necessary for our inland commerce as upon foreign exchanges. And the commonest things become intricate where money has anything to do with them. A farmer in New Hampshire, for instance, can readily form an idea of a bushel of wheat in South Carolina, weighing sixty pounds, and placed at one hundred miles from Charleston; but, if he were told, that in such situation it is worth twentyone shillings and eight pence, he would be obliged to make many inquiries, and form some calculations before he could know that this sum meant in general what he would call four shillings; and even then he would have to inquire what kind of coin that four shillings was paid in, before he could estimate it in his own mind, according to the ideas of money, which he had imbibed. Difficulties of this sort do not occur to farmers alone. They are perplexing to most men, and troublesome to all. It is, however, a fortunate circumstance, that money is so much in the power of the Sovereign, as that he can easily lead the people into new ideas of it; and even if that were not the case, yet the loose state in which our currency has been for some years past, has opened the way for receiving any impressions on that subject.

As we are now shaking off the inconveniences of a depreciating medium, the present moment seems to be that, in which a general currency can best be established, so as that in a few months, the same names of money will mean the same things in the several parts of the United States.

Another inconvenience, which admits of the same easy remedy, and which would indeed be cured by the very same Act, is the want of a legal tender. This is as necessary for the purposes of jurisprudence, as a general currency is for those of commerce. For although there is great impropriety, not to say injustice, in compelling a man to receive a part of his debt in discharge of the whole, yet it is both just and proper, that the law should protect the honest debtor, who is willing to pay, against the vexatious suits of an oppressive creditor, who refuses to receive the full value.

The nature, value, and use of money have always occasioned strong temptations to the commission of fraud, and of consequence, the practice of counterfeiting is coeval with that of coining. No government can guard its subject entirely against the wicked ingenuity, which has been exercised in this respect. But it has always been the object of every wise government to take all the precautions against it, which are within the compass of human ability. These precautions will be least effectual where the coins are so numerous, that the knowledge of them being a kind of science, the lower order of citizens are constantly injured by those who carry on the business of debasing, sweating, clipping, counterfeiting, and the like. It is, therefore, to be lamented, that we have so many different coins in the United States.

It is not necessary to mention what is in everybody's mouth, that the precious metals were first used as bullion, and that the inconvenience of weighing, and the difficulty of assaying introduced the practice of coining, in order that the weight and fineness, might be known at the first view, and of consequence, the value be instantly ascertained. It is equally unnecessary to observe, that the great privilege of declaring this value by particular marks has, among all nations, been vested exclusively in the Sovereign. A trust so important could not indeed be vested anywhere else; because the danger of abusing it was too great. And history informs us, that Sovereigns themselves have not on this occasion behaved with that integrity, which was alike due to their subjects and to themselves, to the interests of their people and their own personal glory.

Experience has already told us, that the advantage of gold as a coin is in this country very considerably diminished, for every distinct piece must be weighed before it can be safely received. Both gold and silver coins are indeed preferable in one respect to common bullion, that the standard is presumed to be just, and consequently, they are received without the delays and expenses of assaying. It must, however, be remembered, that they are all foreign coins, and of course, we are not only exposed to the tricks of individuals, but should it suit the interest or convenience of any Sovereign to make base money for us, there is nothing to prevent it. If, for instance, the King of England, or any of his Birmingham artists, should coin guineas worth but sixteen shillings sterling, our citizens would readily and freely receive them at twentyone shillings sterling. It is my duty to mention to Congress information I have received, that guineas of base metal are coined at Birmingham so well as to escape any common attention. Now there can be no doubt, that every such guinea received here would be a national loss to us of an English crown. How much we suffer in this way at present it is impossible, to estimate.

What I have already had the honor to observe contains some of the reasons why it appears to me highly necessary, that an American coin should be adopted without delay, and to these reasons it may be added, that there is a want of small money for the common occasions of trade, or that it is more felt by our soldiery than any other persons. For the little pay, which they do receive, being either in gold or at best in dollars, the sutlers and others with whom they have dealings, continually take the advantage of their want of change, and rate the prices of their goods accordingly.

Shortly after my appointment, finding that there was a considerable quantity of public copper at Boston, I ordered it round to this place. It has safely arrived, and will when coined amount to a considerable sum. The necessary machinery of a mint can be easily made, and there are persons who can perform the whole business. I must pray leave, therefore, to submit to Congress some few more particular remarks on this subject, as introductory to a plan for an American coin.

Although most nations have coined copper, yet that metal is so impure, that it has never been considered as constituting the money standard. This is affixed to the two precious metals, because they alone will admit of having their intrinsic value precisely ascertained. But nations differ very much in the relation they have established between gold and silver. In some European countries an ounce of pure gold passes for fifteen ounces of pure silver. In others for fourteen. In China it passes for much less. The standard, therefore, which is affixed to both metals is in reality affixed to neither. In England, gold is to silver nearly in that proportion of one to fifteen, and in France nearly of one to fourteen. If a man carries fourteen ounces of gold from France to England he receives two hundred and ten ounces of silver, which in France purchases fifteen ounces of gold. In like manner he who carries from England fourteen ounces of silver to France receives one ounce of gold, which in England purchases fifteen ounces of silver. If it be, then, supposed that the coins of these two countries were alike pure, it must follow that in a short time all the gold coin of full weight would be in England, and all the silver coin of full weight in France. But the light silver circulating in England, and the light gold in France, the real standard of coin in each would be different from the legal, and seek a medium of fourteen and a half of silver for one of gold, although the legal standard might still be in the one place fifteen and in the other fourteen.

The demand which commerce might make for any of the precious metals, in preference of the other, would vary this real standard from time to time, and in every payment a man would get more or less of real value for his debt, according as he was paid in the coin of greater or less value, in relation to the real standard. If, for instance, the debt were contracted when the silver was to gold as one to fifteen, and paid when as one to fourteen; if the debt were paid in silver he would gain one thirtieth, and if in gold he would lose one thirtieth. In England the money standard is rather affixed to gold than to silver, because all payments are made in the former; and in France it is rather affixed to silver than to gold.

Arguments are unnecessary to show, that the scale by which everything is to be measured ought to be as fixed as the nature of things will admit of. Since, therefore, a money standard affixed to both the precious metals will not give this certain scale, it is better to make use of one only. Gold is more valuable than silver, and so far must have the preference. But it is from that very circumstance the more exposed to fraudulent practices. Its value rendering it more portable is an advantage, but it is an advantage, which paper possesses in a much greater degree, and of consequence the commercial nation of England has had recourse to paper for the purposes of its trade, although the mass of circulating coin is gold. It will always be in our power to carry a paper circulation to every proper extent. There can be no doubt, therefore, that our money standard ought to be affixed to silver.

But silver is liable, like everything else, to a change of value. If there is a demand for it to export, the value will rise; if the contrary it will fall; and so far it cannot be considered as a fixed measure of value. Before this objection be considered it will be proper to make a few reflections on another part of the present subject; but in this place I remark, that if the objection cannot be removed, we must not suffer it to be preponderate, because it weighs alike against every other metal.

To coin money is a certain expense, and of course it is an expense, which must be borne by the people. In England the coin when melted will sell as bullion for just as much as its weight in other coin. The expense of coinage is paid by the Crown, and of course is raised by taxes from the people. In France the coinage instead of being expensive yields a profit. The price given for metal at the mint is about eight per cent less than the same quantity will yield when coined at the French standard. Both of these methods are liable to objections. When commerce demands an exportation of bullion from England, the coin of the kingdom goes out in common with others. This increases, of course, the national expense of coinage. Laws to prevent the exportation, or importation of any thing so valuable as money are always nugatory, because they always _can_ be eluded, and therefore when private interest requires it they always _will_ be eluded. That the guineas of England, therefore, are not continually going away is to be attributed to the extraordinary value affixed to gold, which has just been mentioned, and which banishes silver continually. In France the people are not liable to this inconvenience, because their money passing for more than its value in bullion, bullion will always be exported in preference to coin. But, for the same reason, there is always a strong temptation to imitate their coin and send it for the purchase of their commodities. It would be both impossible and unnecessary to distinguish the true from the false, because both would be of equal intrinsic value. The place at which they were struck would be indifferent to the receiver. Of consequence, the foreigner who made French coin, would gain; by his trade, and the French nation would lose proportionably.

The money paid for coining, or the coinage of France has, however, this advantage, that the money is a standard, which does not fluctuate with the price of bullion. This coinage is, as has been said, about eight per cent. When bullion is below ninetytwo, it is carried to the mint; when above ninetytwo, to the broker, or the silversmith. The coin still continues fixed, nor will it bear exportation until bullion rises to a hundred, when the French coin would be as liable to exportation as the English. In that case, it would be exported on one hand, while on the other no more would have been coined for a considerable period, because to make the eight percent coinage, it would be necessary that the mint price should be ninetytwo. The coin, therefore, could not long be exported, if at all, but would resume its value. The price of bullion must float between ninetytwo and a hundred, while the coin would preserve its fixed quality as money.

Hence then, it appears proper, that the price of coining should be defrayed by the coinage; because, first, it is natural and proper, that the price should be paid when the benefit is received, and that the citizen in return for the advantage of being ascertained in the value of the medium of commerce by the sovereign, should pay for ascertaining it, just as much as that he should pay for the fashion of the plate he uses, or the construction of the cart he employs. Secondly, it is right that money should acquire a value as money, distinct from that which it possesses as a commodity, in order that it should be a fixed rule, whereby to measure the value of all other things. And thirdly, it is wise to prevent the exportation of coin, which would involve an unnecessary national expense, and also to prevent the imitation of it abroad, so as to create a national loss. For both of which purposes, it is proper that the coinage should only defray the expense, without making any considerable profit. The laws usual in all countries, with respect to the money, will then fully operate the effect intended.

In order that a coin may be perfectly intelligible to the whole people, it must have some affinity to the former currency. This, therefore, will be requisite in the present case. The purposes of commerce require, that the lowest divisible point of money, or what is more properly called the _money unit_, should be very small, because by that means, price can be brought in the smallest things to bear a proportion to the value. And although it is not absolutely necessary, yet it is very desirable, that money should be increased in decimal ratio, because by that means all calculations of interest, exchange, insurance, and the like, are rendered much more simple and accurate, and of course, more within the power of the great mass of the people. Wherever such things require much labor, time, and reflection, the greater number who do not know, are made the dupes of the smaller number who do.

The various coins which have circulated in America, have undergone different changes in their value, so that there is hardly any which can be considered as a general standard, unless it be Spanish dollars. These pass in Georgia at five shillings, in North Carolina and New York at eight shillings, in Virginia and the four Eastern States at six shillings, and in all the other States, excepting South Carolina, at seven shillings and sixpence, and in South Carolina at thirtytwo shillings and sixpence. The money unit of a new coin to agree, without a fraction, with all these different values of a dollar, excepting the last, will be the fourteen hundred and fortieth part of a dollar, equal to the sixteen hundredth part of a crown. Of these units, twentyfour will be a penny of Georgia, fifteen will be a penny of North Carolina or New York, twenty will be a penny of Virginia and the Four Eastern States, sixteen will be a penny of all the other States, excepting South Carolina, and fortyeight will be thirteen pence of South Carolina.

It has already been observed, that to have the money unit very small, is advantageous to commerce; but there is no necessity that this money unit be exactly represented in coin, it is sufficient that its value be precisely known. On the present occasion, two copper coins will be proper, the one of eight units, and the other of five. These may be called an Eight, and a Five. Two of the former will make a penny Proclamation, or Pennsylvania money, and three a penny Georgia money. Of the latter, three will make a penny New York money, and four a penny lawful, or Virginia money. The money unit will be equal to a quarter of a grain of fine silver in coined money. Proceeding thence in a decimal ratio, one hundred would be the lowest silver coin, and might be called a _Cent_. It would contain twentyfive grains of fine silver, to which may be added two grains of copper, and the whole would weigh one pennyweight and three grains. Five of these would make a _Quint_, or five hundred units, weighing five pennyweight and fifteen grains; and ten would make a _Mark_, or one thousand units, weighing eleven pennyweight and six grains.

If the mint price of fine silver be established at twentytwo thousand two hundred and thirtyseven units per pound, this being coined would be four times five thousand seven hundred and sixty grains, or twentythree thousand and forty units. The difference is eight hundred and three units, and therefore the coinage is eight hundred and three, or twentythree thousand and forty, or somewhat more than three fortyeight one hundred per cent, which would be about the expense attending it. A dollar contains by the assays, which I have been able to get, about three hundred and seventythree grains of fine silver, and that at the mint price would be fourteen hundred and forty units. In like manner, if crowns contain from four hundred and fourteen to four hundred and fifteen grains of fine silver, they would, at the mint price, be worth sixteen hundred units.

When such a coin shall have been established, the value of all others would be easily ascertained, because nothing more would be necessary than to have them assayed at the mint. The advantage of possessing legal money, in preference of any other, would induce people to carry foreign coin to the mint, until a sufficiency were struck for the circulating medium. The remainder of the foreign silver, together with the gold, should be left entirely to the operations of commerce as bullion.

In the present moment, it is by no means of such consequence to establish the relative value of different coins, as to provide a standard of our own, by which in future to estimate them. If the value were now sought, they must all be estimated in dollars, because dollars are called for in the several requisitions of Congress. Without noticing the preference thus given of one coin over another, it is sufficient to observe, that if a greater alloy should be introduced by the Spanish government into their dollars, our interior regulations as to money would be overturned; and certainly we have no security that this will not happen. There is not any great inconvenience in leaving matters on their present footing, until they can be remedied by the operations of a mint; for it is not to be supposed that all the money raised by taxes in a State is to be brought out of it. I expect that there will be very little occasion to transport money from place to place. It is much easier to negotiate than to carry it; and if any species of money is generally received within a State at the same rate in which it is paid in taxes, there will be no difficulty in expending it at its value. Whenever money shall be struck by authority of the United States, then indeed it will be proper to receive in taxes no other coin.

If Congress are of opinion with me, that it will be proper to coin money, I will immediately obey their orders and establish a mint. And I think I can say with safety, that no better moment could be chosen for the purpose than the present; neither will anything have a greater tendency to restore public credit; for although it is possible that the new money will at first be received with diffidence by some, yet when it has been fairly assayed, it will gain full confidence from all, and the advantage of holding the only money, which can pay debts or discharge taxes, will soon give it the preference over all, and indeed banish all other from circulation. Whereas fixing a relation of value now on whatever principles attempted, might give offence to the power whose coin should, in any instance, be reduced from its present numerary value among us.

These sentiments are submitted, with all possible deference, to the United States in Congress assembled, in expectation of their further instructions on the subject.

With great respect, I have the honor to be, &c.

ROBERT MORRIS.

* * * * *

GEORGE WASHINGTON TO ROBERT MORRIS.[3]

Philadelphia, January 25th, 1782.

Sir,

I have received your favor of the 23d respecting Captain Hutchins, and shall give you a more definitive answer after I have seen that gentleman.

[3] _January 26th._ In consequence of the information received
from Mr Thomas Paine, of the intentions of some officers to
promote a general application by way of memorial to General
Washington, respecting their pay, I sent for him and had a long
conversation on various matters of a public nature. He observed,
that his services to the public had rather been neglected. I told
him I could wish his pen to be wielded in aid of such measures, as
I might be able to convince him were clearly calculated for the
service of the United States; that I had no views or plans but
what were meant for the public good, and that I should ask no
man's assistance on any other ground; that it was true I had
nothing in my power at present to offer, as a compensation for his
services, but that something might turn up, and that I should have
him in my mind.--_Diary._

* * * * *

The following record is also contained among Mr Morris's papers,
in his own hand writing, dated February, 1782.

"Having lately had several meetings with Mr Thomas Paine, the
writer of a pamphlet, styled _Common Sense_, and of many other
well known political pieces, which, in the opinion of many
respectable characters have been of service to the cause of
America, I thought this gentleman might become far more
serviceable to the United States by being engaged to write in the
public newspapers in support of the measures of Congress and their
Ministers. My assistant, Mr Gouverneur Morris, is clearly of the
same opinion, and in all our conferences with him, we have
pointedly declared, that we sought the aid of his pen only in
support of upright measures and a faithful administration in the
service of our country. We disclaim private or partial views,
selfish schemes or plans of any and every kind. We wish to draw
the resources and powers of the country into action. We wish to
bring into the field an army equal to the object for which we are
at war. We wish to feed, clothe, move, and pay that army as they
ought to be done, but we wish also to effect these on such terms
as may be least burdensome to the people, at the same time that
the operations shall be every way effective.

"Having these for our objects we want the aid of an able pen to
urge the Legislatures of the several States to grant sufficient
taxes; to grant those taxes separate and distinct from those
levied for State purposes; to put such taxes, or rather the money
arising from them, in the power of Congress, from the moment of
collection;

"To grant permanent revenues for discharging the interest on debts
already contracted, or that may be contracted;

"To extend by a new confederation the powers of Congress, so that
they may be competent to the government of the United States and
the management of their affairs;

"To prepare the minds of the people for such restraints and such
taxes and imposts, as are absolutely necessary for their own
welfare;

"To comment from time to time on military transactions, so as to
place in a proper point of view the bravery, good conduct, and
soldiership of our officers and troops, when they deserve
applause, and to do the same on such conduct of such civil
officers or citizens, as act conspicuously for the service of
their country.

"Finding Mr Paine well disposed to the undertaking, and observing
that General Washington had twice in my company expressed his
wishes, that some provision could be made for that gentleman, I
took an opportunity to explain my design to the General, who
agreed entirely in the plan. I then communicated the same to Mr
Robert R. Livingston, Secretary of Foreign Affairs, and proposed
that he should join me in this business, by furnishing from his
department such intelligence, as might be necessary from time to
time to answer such useful purposes for which Mr Paine is to
write; and in order to reward this gentleman for his labors, and
enable him to devote his time to the service of the United States,
it was agreed to allow him eight hundred dollars a year, to be
paid quarterly. But it was also agreed, that this allowance should
not be known to any other persons than those already mentioned,
lest the publications might lose their force if it were known that
the author is paid for them by government."

By a letter, which General Lincoln addressed, to me before he went to the eastward, I find that you approve of my plan of sending officers to the four New England States particularly, with the returns of their deficiencies of troops, and with instructions to attend upon the Legislatures, and to endeavor to impress them with the expediency, and indeed necessity, of filling their battalions previous to the opening of the campaign. He informed me also, that you would be glad to give the same officers some instructions relative to the business of your department. If so, I could wish you would have your letters ready to go by the next post, by which time I expect to have the returns prepared. I have not yet fixed upon the gentlemen who will be proper, but you can leave blanks for the insertion of the names of those who may be chosen.

As we may reasonably expect to hear soon again from Sir Henry Clinton, on the subject of the meeting of commissioners, I think it would be well to be preparing the substance of the powers to be delegated to the gentlemen to whom the transaction of the proposed business will be committed. What I would wish you to prepare particularly, is so much as will relate to the liquidation of the former accounts of prisoners, and making provision for their maintenance in future.

I have the honor to be, &c.

GEORGE WASHINGTON.

* * * * *

TO THE PRESIDENT OF CONGRESS.

Office of Finance, February 11th, 1782.

Sir,

The situation of my department makes it necessary to lay some matters of importance before the United States in Congress, and I shall endeavor to do so with as much precision, as possible.

It gives me pain to observe, that the States of Massachusetts, Rhode Island, and Maryland, have not yet passed the laws recommended by the resolutions of the third of February, 1781. I learn, (though not officially,) that the State of Virginia has lately suspended the operation of the law, which they had passed in conformity to that resolution. The bare mention of these things is sufficient to mark the consequences. Our debt being unfunded and unprovided for, the interest cannot be paid. Those, therefore, who trusted us in the hour of distress, are defrauded. To expect that, under such circumstances, others will confide in the government, would be folly; and to expect that foreigners will trust a government, which has no credit with its own citizens, would be madness. The whole weight, therefore, of the war must be borne in the present moment; and even the slightest anticipations of revenue are made on the personal credit of the Minister.

This, Sir, is not said boastingly, but with unaffected concern. I have labored to establish a credit for my country, that when the period should arrive, (and I hoped it was not far distant,) in which I could lay down the burden now pressing upon me, my successor in office should have no other difficulties to struggle with, than those which necessarily attend an extensive and complicated administration. It is, therefore, with no common degree of anxiety and distress, that I see my wishes frustrated. I feel as an American for my country, as a public servant for the interest and honor of those whom I serve, and as a man, that I cannot enjoy the ease and tranquillity I have sought for through a life of continual care and unremitted labor. It is my duty to mention to you the fact, and to apprize you, that in such circumstances, our operations will continue to be desultory efforts of individual power, rather than the combined exertion of political strength and firmness.

The repeated assurances we daily receive from the Ministers of his Most Christian Majesty, of their steady determination to grant no further pecuniary aid, will not leave room to doubt of their intentions. I candidly acknowledge that I had formed not only hopes, but even expectations from that quarter. For I had persuaded myself, that when the brilliant successes of the last campaign should be known, and when it should also be known how much the United States are capable of, and how necessary an aid of money is to call their power into action, the King would have again extended that relief, which must be most beneficial to the common cause. Even now, I shall request that Congress will instruct the Secretary of Foreign Affairs to make the most pointed representations on this subject through our Minister at the Court of Versailles, and I shall readily furnish all such materials in my department as may be necessary for the purpose; but I must not conceal my doubts as to the effect of such representations. Duty to this country requires that they should be made, but prudence forbids a reliance on their success, and will dictate to us a farther duty, which is, to act under the influence of a belief, that they will not succeed.

As to hopes of pecuniary aid from any other quarter, the delusion has already passed away. It is in vain that expensive establishments are kept up to solicit succor from Spain, who appears neither able nor willing to afford it; from Holland, who seeks peace and not to increase the causes of war; or from Russia, who seems more inclined to crush, than to support us. Let us apply to borrow wherever we may, our mouths will always be stopped by the one word, security. The States will not give revenue for the purpose, and the United States have nothing to give but a general national promise, of which their enemies loudly charge them with the violation.

Thus, Sir, compelled, however reluctantly, to look at home for the means of supporting ourselves against an enemy, whose power has rather increased with the increase of her foes, whose force has risen superior to defeats, and has found resources in a situation, which might have inspired despair, we must no longer rely on those who may neglect us, but take care that we be not charged with neglecting ourselves. I would to God, that I could say, that there were even the appearances of general vigor and exertion. But the truth is very different. The United States have called for eight millions of dollars early in November last, of which the first quarterly payment was to have been made on the 1st day of April next; but I cannot find that a single State has yet laid the taxes. I neither know what they will think proper to give, nor when. Happy to experience a momentary relief from the clamor and revolt of a starving army, from the rage and devastation of an inveterate enemy, and from the waste and extravagance of cumbrous, unwieldy departments, there appears to be no solicitude anywhere for the support of arrangements, on which the salvation of our country depends.

To give a little time for the people to breathe, and to remedy some of the many abuses, which were equally palpable and enormous, I early ventured on the business of contracting, and I have extended it as far as prudence would in any degree justify. Nay, relying on the States for support, I have made engagements, which, in almost any other circumstances, would savor of temerity, and which nothing would have led me to do, but a hope that by retrenching expenses, they would be sooner induced to grant revenue. So thoroughly am I convinced of the superior economy, which attends the present mode of supplying our armies, that I would have offered contracts for the southern department, could I have formed any well grounded expectation of moneys sufficient for the purpose from the southern States. Nor should I have been deterred even by the distance of the period at which it could be had, if I could have formed a reasonable reliance on it at some certain period. Our expenses, it is true, are retrenched, and to give an idea to what degree, I will mention, that for the amount of salaries alone in the Commissary's department to the northward of Potomac river, between three and four thousand soldiers are now fed with full rations. But though the retrenchments are great, the expenses are great also, and they must rapidly increase every moment in preparing for an early and vigorous campaign.

A view either of general politics or of our own situation will impress the conviction, that we ought to make an early and vigorous campaign. The blow, which the enemy have received in Virginia, should be followed as soon as possible before they have time for reflection, for reinforcement, or for defence. We must not imagine that Great Britain will be so stunned by this blow that she cannot recover, or that she will, for such a check, abandon the object both of her interest and her wishes, an object in which national importance appears to be combined with her national existence, and where every covetous and angry passion is strongly excited. What aid she may find from foreign powers must depend upon the manner of considering the propositions, which may be made, perhaps upon their interests, and, perhaps, upon their caprice. A nation, which can hold at bay one half the force of Europe, is by no means a despicable ally.

But whether she gets aid from others, or whether she draws it, as before, from domestic credit and confidence, this, at least, is certain, that we ought to expect new efforts against us, and that we ought not to expect any in our favor. If then, we can strike before she is ready to ward off the stroke, or bear the blow, our own people will be animated, the doubtful will be convinced, and the convinced will be confirmed. Nations, who are friendly to us, will give marks of amity. Nations, who are hostile, will be deterred from their attempts. The councils of our enemy will be distracted. Their intended succors may land on hostile ground, and where they want relief, it may be too late to obtain it. At what point, and in what manner, and for what purpose our efforts are to be made, is the province of the General to determine; but, I repeat again, it is our indispensable duty to put him speedily in possession of the means.

In order that anything effectual may be done, we must have both men and money, and we must have them early. On the 10th of December last, Congress were pleased to call on the States in the most pressing manner, to have their respective quotas in the field by the 1st day of March next; and they determined, that recruits should be raised to complete the quotas at the expense of the States, in the first instance to be reimbursed by the United States. The intention of these resolutions, however clear, may be misunderstood, and attempts made to deduct the expenditures of the recruiting service from the supplies, which were required by the Acts of the 30th of October and 3d of November. For this reason, and also that the States may be more effectually stimulated to comply with the views and wishes of Congress, I shall, before I close this letter, submit certain additions and explanations of their Act of the 10th of December. At present, I shall only observe, that it gives me very sincere pleasure to find the United States in Congress, so fully impressed with the necessity of early efforts. This circumstance leads me to hope that they will be equally impressed with the duty of urging a compliance with their requisitions. It is at least my duty to suggest it. A duty, which I owe to America at large, and which no hope of praise, or apprehension of blame, shall induce me to neglect. I know there is a delicacy, which influences some minds to treat the States with tenderness and even adulation, while they are in the habitual inattention to the calls of national interest and honor. I know that delicacy, and I disclaim it. Nor will I be deterred from waking those who slumber on the brink of ruin. But my voice, Sir, is feeble, and I must therefore pray to be assisted by the voice of the United States in Congress. Supported by them, I may, perhaps, do something; but, without that support, I must be a useless incumbrance.

It is also a duty to economise the moneys which are in our possession, and it receives a double force of obligation from the peculiarity of our circumstances. What moneys the States may grant, and when they may grant them, is known only to Him who knoweth all things; but that which we have is certain, and ought not to be expended but for useful purposes. If we look back to the conduct of the several States in former times, we shall find that the negligence with which they have treated the requests of Congress has been unequalled, unless by the earnestness of entreaty, with which those requests were made. And I fear that there is little hope, that the conduct now to be pursued will in one instant become the counter part of former experiences. We have reason to apprehend a continuance of that shameful negligence, which has marked us to a proverb, while all Europe gazed in astonishment at the unparalleled boldness and vastness of claims, blended with an unparalleled indolence, and imbecility of conduct. But let the several States be ever so negligent, the confederation has given no power to compel. While it confers on Congress the privilege of asking everything, it has secured to each State the prerogative of granting nothing. Since, then, the Congress cannot compel the States to make a grant of money, they must at least take care to prevent the States from making an unnecessary expenditure of those moneys, which are in our possession. Nor is this all. We are called on by the principles of justice as well as of duty to prevent such expenditure.

The requisitions of Congress have been for men and money. The States have furnished officers and transmitted a variety of accounts, demands and complaints; but while officers continue numerous they have neglected to provide soldiers. Instead of it, some of them have formed State regiments, and given State bounties to all those regiments; regiments confined to the limits of the State, as if the ultimate object of military employment were the show of parade, or to consume the fruits of the earth. In the meantime, the continental officers, whose services have entitled them to respectful attention, and whose experience has enabled them to be essentially useful, are left without men to command, and forced to bear the mortification which must afflict every generous mind, perceiving themselves a useless burden to the community.