The Diplomatic Correspondence of the American Revolution Volume XII Part 44

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_President of Congress_, his household, $10,000 His private Secretary, 500 ------- $10,500 _Secretary of Congress_, 3,000 Two Clerks, 1,000 Messenger, 300 ------ 4,300 Contingencies; fuel, stationary, rent. &c. 750 ----- 5,050 _Chaplains of Congress_, 2,000 _Three Judges of Appeals_, at 2250 dollars each, 6,750 Contingencies during their sittings, 150 ----- 6,900 ------ 24,450

_Superintendent of Finance_, $6,000 a.s.sistant, 1,850 Secretary, 1,000 Clerks, three, 1,500 Messenger, 300 ------ $10,650 Contingencies, 750 ------- 11,400 _Minister of War_, 6,000 Two Clerks, 1,000 Messenger, 300 ------ 7,300 Contingencies, 500 ------- 7,800 _Minister of Foreign Affairs_, 6,000 Two Secretaries, 2,000 Messenger, 300 ------ 8,300 Contingencies, 500 ------- 8,800 _Controller of the Treasury_, 1,850 Auditor, 1,000 Six Clerks, 3,000 ------ 5,850 Register, 1,200 Four Clerks, 2,000 ------ 3,200 Treasurer, 1,500 Clerk, 500 ------ 2,000 Messenger, 300 ------- 11,350 Contingencies, 1,000 ------- 12,350 ------ 64,800 _Two Foreign Ministers, at $10,000 each_, 20,000 _Five Residents, with Consular Powers, at 6,000_, 30,000 Contingencies, 10,000 ------ 60,000 -------- Permanent expense, 124,800.

_Temporary Expense._

A Commissioner of accounts here, salary 1,500

A Commissioner for settling old accounts in Europe, his clerks, contingent expenses, &c. suppose $10,000 Two Clerks, 1,000 Contingencies, 250 ------ 2,750 Multiply by 18 ------ 49,500 ------- 59,500 --------- $184,300.


Office of Finance, March 17th, 1784.


Permit me, through your Excellency, to call the attention of the United States to the situation of my department. During the last year, engagements were made to a very considerable amount for payment of the army. This payment was effected by notes which fell due the end of last year, and the commencement of this. The funds at my disposal were unequal to the discharge of them. I was, therefore, under the necessity of drawing bills on the credit of the loan in Holland. The information I had received from the gentlemen who had the management of it, gave me hopes that funds sufficient to discharge those bills were in their hands; for in the months of April, May, June and July, they had received and distributed obligations for one million one hundred and thirtysix thousand florins. But from causes, which will readily suggest themselves to Congress, that loan, which had taken a rapid start at the peace, began to decline in August and stood still during all November. It has happened, therefore, that bills to the amount of one million three hundred and twentyfive thousand florins, equal at the current exchange to five hundred and thirty thousand dollars, are protested for non-acceptance. Should they come back protested for non-payment, the consequences will be easily imagined.

For about a month past I have been in the expectation, that this disagreeable event would happen, and whether it will or not is yet undetermined. My last advices from the gentlemen who have the management of the loan are in a letter of the 22d of December; by which they tell me, "we are sorry to be obliged to repeat, that since our last till the present moment, our prospects are not very much increased; however, we are not quite without hopes, and have determined, if we cannot do otherwise, to sacrifice some more premium to the undertakers, which if we do, we will charge to the account of the United States. We think ourselves fully authorised to do this by the circ.u.mstances; since without the bills going back, it is certain that, besides the disappointment and the discredit it would give to the government bills, the expenses attending the returns will be much more burdensome. We have almost no prospect of getting the money without such a sacrifice, and only hope it will answer your views." Enclosed you have the account current with those gentlemen, as sketched out by the register for information; by which it appears, that they had in their hands a balance of three hundred and fortyseven thousand seven hundred and seventy current guilders on the 31st of October last, and by the subordinate account, number five, it will appear, that my bills exceed that balance by one million five hundred and thirteen thousand two hundred and twentynine florins; but from this a deduction is to be made for some tobacco shipped to them, the account of sales whereof is not yet come to hand. They have, however, accepted of my bills beyond the amount of their funds, and still there are to the value of one million three hundred and twentyfive thousand florins protested for non-acceptance. In order, however, that Congress may possess as full a view of things as possible, I will suppose, for the present, that by making a sacrifice of premium the funds for discharging these bills may be obtained. I must also mention here, to obviate what might be suggested, that the remittances to Messrs Le Couteulx and Mr Grand will be found accounted for in their accounts, but time will not permit going into all those details at present.

Supposing then the funds to be obtained for payment of these bills, the interest falling due the beginning of June next, will amount to two hundred thousand florins, equal at the current exchange to $80,000

By the enclosed state of payments just received from Mr Grand it will appear, that on the 5th of November, there is payable at his House the sum of one million six hundred thousand livres, equal at the current exchange to 320,000 -------- $400,000

Thus you will find, that on the best supposition which can be made, there is to be paid in Europe during this year four hundred thousand dollars, over and above the salaries of foreign Ministers and their contingent expenses. There is also to be paid the further sum of one hundred thousand dollars, due in this country on engagements taken for the public service during the last and present year, besides notes in circulation, which may probably be absorbed by the taxes, between this and the 1st of May next. Thus there is a deficiency of half a million to be provided for by the taxes from the 1st of May, to which must be added sundry debts of the last year not yet adjusted, and which cannot therefore be estimated, but which may amount to between one and two hundred thousand dollars more. And to all this must be added the current expenses, which Congress will best be able to ascertain.

This, Sir, is a view of things upon the fairest side, but if the bills noted for non-acceptance come back, a scene will then be opened, which it is better for you to conceive than for me to describe. The delay of the States in pa.s.sing the laws for granting revenue to fund our debts has left the above mentioned sum of four hundred thousand dollars totally unprovided for; and I cannot see the least probability that this general concurrence will be obtained in season to make that provision. I beg leave, therefore, to suggest the expedient that the produce of the requisitions for 1782 and 1783 be partly appropriated to that payment, and that the money be replaced from the proper funds when obtained. But whatever mode may be adopted, Congress will doubtless be struck with this truth, that unless the States can be stimulated into exertion, and that speedily, everything must fall into confusion.

I will not pretend to antic.i.p.ate the evil consequences. Having stated the facts I have done my duty.

I must, however, pray a moment's indulgence to mention, that the accounts of the last year would have been rendered by this time, but as I have not relinquished the hope of being able to quit this office soon, I have rather desired to be able to complete all the accounts of my administration. It will give me infinite pleasure, if, when I have the honor of presenting to Congress these accounts with my commission, I shall find them in circ.u.mstances as prosperous as those under which I accepted it were adverse.

I am, Sir, &c.



Office of Finance, March 30th, 1784.


I am to acknowledge the receipt of your favor of the 14th instant; which should have been done sooner, but that I have been much engaged, and indeed the accounts you ask for, and which are enclosed, required time to be completed. I shall expect the papers which relate to Mr Gillon by the first good opportunity.

With respect to the report of the committee, I cannot presume to say anything about it, unless it should be officially referred to me, which indeed would seem to be the regular mode of proceeding in matters of that sort, but I am far from desirous of such reference, and therefore if Congress are prepared to decide, I am perfectly content. So long as I am in their service I shall endeavor to carry their measures into effect.

I am perfectly in opinion with the committee, that the arrears should be demanded before new requisitions are made; and if I were to hint anything like advice, it should be that Congress state clearly the evils which arise from their inability to enforce the payments.

The desire that Loan officers may issue certificates I have long known, and I know also, that it originates in a desire to elude actual by making nominal payments. However, it occurs to me that a mode might be fallen upon to conciliate this object with the public interest. I consider the Loan offices as a very unnecessary burden on the community, and I think they ought to be got rid of, for I am sure that the whole business might be better done at one tenth of the expense, besides the advantage of leaving no unsettled accounts behind. If the States will act with rigor and honesty on the present occasion, there would be no difficulty, I should suppose, in negotiating with the several banks to make actual effective payment. But you may be sure they will not undertake anything unless they have a solid reliance on the revenues. Now this is precisely what Congress ought to desire, for if they are prevailed on to cause the issue of paper money by their officers, the States may as heretofore neglect the means of redeeming it, and then all the blame falls upon Congress. Indeed they would well deserve it. For why need they attempt to accommodate the States in the manner proposed? Think you the Legislatures will be more solicitous to save the public faith than to quiet the clamors of their own citizens? For my part I am persuaded that they will not, and I cannot but think that an address to the public creditors, charging the fault where it is justly chargeable, would be more useful than mere temporary palliations of their distress. On the whole I think it best for Congress to adhere as much as possible to great outlines, and to avoid details. Those should be left to the Minister of Finance. If he is an able and honest man he will do well, and if the thing be well done all is right. If he be unequal to his duties, the blame of wrong measures will fall upon him. But if Congress do his work, then unless their work be more than humanly perfect, they will undoubtedly compromise themselves. I say these things to you in a conviction of the truth of what I say, and with a perfect indifference as to any personal considerations. If I can get out of office I will, and if I cannot I will never ask Congress for a confidence they do not wish to repose.

I am very much obliged, my Dear Sir, by your kind and confidential communication, and reply to it, as you see, with full confidence.

If I were in a situation to converse with you on the state of our affairs, I should be glad to do it, but the limits of a letter will not permit the saying what is necessary on so extensive a subject. I find that Congress are in the habit of pa.s.sing resolutions, which relate to my department, without a reference; I am sorry for it, because some of them are inconvenient to me, and others will I fear be found dangerous. However, they are the best judges of what is for the public interest, and therefore I shall avoid as much as possible all remonstrance.

I am, very sincerely, your most obedient, &c.



Office of Finance, April 8th, 1784.


I have received the letter which you did me the honor to write on the 30th of last month, for which I pray you to accept my thanks.

The circular letter, a copy of which you enclosed, has my entire approbation, and I pray leave to a.s.sure the committee, that while I am favored with the firm support of Congress, I shall not shrink from the difficulties, however great, with which we are threatened.

The idea of applying to the banks for aid, is in itself a good one, but the present moment is unfavorable. The establishment of so many banks instead of aiding credit, and facilitating operations, will for some time to come have a contrary effect, and it is not without great difficulty, that they will each collect a capital sufficient to support its own operations. The struggle to get such capital, places these inst.i.tutions in a degree of opposition to each other, injurious to them all. Without going more minutely into that part of the subject, I take the liberty to observe further, that as we had no mint established when the treaty of peace took place, and consequently no proper regulation of our coin, a great part of it was immediately exported, and the country being now laden with foreign goods, and having but little means of payment with produce, still farther exportations of coin will take place, especially if by the return of the public bills so great an additional remittance becomes necessary.

I shall leave all observations upon this matter to the good sense of the committee, and proceed to mention further, that if the abilities of the several banks were ever so great, we cannot rely much on their inclinations, unless their respective directors could clearly see a prospect of speedy reimburs.e.m.e.nt from the taxes. It is, therefore, a matter of much delicacy, to make any proposals to them on the part of government; for which and for other evident reasons, I pray leave to suggest the propriety of leaving all such negotiations to the Superintendent of Finance.

That officer has already sufficient powers to do everything, except granting premiums for the loans proposed, and with respect to them, I am clearly of opinion, that none ought to be given; but if in the last necessity that step should be unavoidable, he may then apply for authority. This I conceive to be better than vesting him beforehand with such extensive power; for the committee will be pleased to observe, that as the laws of the several States have fixed the rate of interest, premiums on loans, which in their effect raise the rate of interest, would be exceptionable as well as odious. It is true, that the situation of affairs is very disagreeable, but it is better to bear up and struggle hard against present difficulties than lay the foundation of future evils.

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



Office of Finance, April 29th, 1784.


I do myself the honor to enclose for the consideration of Congress the extract of a letter from the commissioner for settling the accounts of Connecticut, together with the copy of a receipt which was enclosed in it, and the original of which is returned to the commissioner. Before I make any observations on this extract I take the present opportunity of explaining a part of my conduct, which has I know given some offence.

Previous to the acceptance of my office I was naturally led to examine the ground on which I should be brought to act. I clearly saw that great confusion had been introduced into the public affairs, not merely from defects in former plans, but from a great negligence in those to whom the execution had been committed. For although the general arrangements were in some respects defective, as is the case with all human inst.i.tutions, yet those who were in any degree culpable had taken care to charge the fault on such deficiencies by way of excusing themselves. Congress will perceive at a single glance, that where boards or committees, perpetually changing, and whose members are not accountable, are charged with the superintendence of a general system, and the subordinate agents rendered accountable to them, it is vain to expect that steady, severe, and attentive administration, which can alone secure the public welfare. Experience had shown, that this radical evil produced shameful negligences in the executive departments, the mischiefs of which are felt at the present hour. Affairs were so complicated that it was hardly possible to say who was in fault; and while every individual officer took care to excuse himself the blame was placed on Congress; from whom of all others, if the future interests of America be consulted, it ought to be removed. The expense which attends the settlement of the old accounts is the least mischief which has resulted.

This view of our situation rendered it necessary for me to stipulate, that I should be invested with ample powers, and induced, also, the determination to avoid as much as possible the employing of persons who had public accounts unsettled. My subsequent experience has shown, that if this determination had been universally adhered to, it would have tended much to the establishment of that regularity, which has constantly been kept in view. From frequent information I was convinced, that many of the loan officers had not conducted their business according to the modes prescribed, and had indeed neglected even to make those returns, which had been from the beginning required. This was an additional reason for placing the receipt of the continental taxes in other hands. And when it was considered, that these gentlemen would be constantly pressed for the payment of interest, that which was necessary in the case with some became proper with respect to all. This conduct, as has been already mentioned, gave offence to some, but as no regular accusation has ever been brought I shall go no farther into a defence of the measure; my object being as well to point at future operations as to explain the past.

I will not go into a detail of the modes formerly prescribed for keeping the Loan Office accounts. Suffice it to say, that very few of the officers have conformed to them. The instructions for settling the accounts are before Congress, and the enclosed extract shows that they cannot be effectually adhered to; and consequently that a princ.i.p.al object in the settlement of the accounts will not be effected. I pray leave, therefore, again to bring to the attention of Congress a report made on the 3d of September from the Office of Finance. Not that it is desired that the United States should adopt the resolution there proposed, but merely that it may serve as a groundwork on which to establish some Act which may prove effectual.

It is perhaps a favorite object to keep up the establishment of the Loan offices, but I must on this occasion repeat what I have so often declared, that it is an expensive and a pernicious establishment, without being attended with a single good effect to compensate the mischiefs. I shall not, however, trouble Congress with my reasons on that subject, because I think it my duty to bear witness against them. I know the progress of all reformations to be slow, and that experience is the most certain teacher.

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The Diplomatic Correspondence of the American Revolution Volume XII Part 44 summary

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