These being arranged,
a decision was made upon a matter of permanent impor-
tance--the mode of disposing of the western territory.
a decision was made upon a matter of permanent impor-
tance--the mode of disposing of the western territory.
Hamilton - 1834 - Life on Hamilton - v2
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? HAMILTON.
295
port was from Jefferson, Chase, and Howell. It is to be
remarked, that it embodied a proviso for the exclusion of
slavery in the contemplated states, after the commence-
ment of the nineteenth century, which, though sustained
by the votes of all (but the southern states,) and by those
of Jefferson and Williamson, was expunged. This report
is a remarkable event in the history of its author. It con-
templated an exercise of the highest powers of govern-
ment; nothing less than the creation of independent
states; their admission as members of the confederacy,
and the determination of the conditions of such admission.
But it was an exercise of powers not delegated to the
confederation ! " All this was done without the least col-
our of constitutional authority; yet no blame was whisper-
ed, no alarm sounded. The public interest, the necessity
of the case, imposed upon congress the task of overleaping
their constitutional authority. "*
It has been previously mentioned that Jefferson had re-
paired to Philadelphia the preceding year, with a view to
his embarcation as a joint commissioner in the negotiation
at Paris. He was appointedf on motion of Madison, it
being suggested that a recent domestic calamity had
probably changed his sentiments with regard to public
life; that " all the reasons for his original appointment still
existed, and had acquired additional force from the im-
probability that Laurens would actually assist in the ne-
gotiation. ":); The intelligence from Europe led to a reso-
lution, that he must " not proceed on his intended voyage
until further instructions. " Though he hoped there was
no prospect of his having any thing more to do than to
join in the celebration of peace, he remained near the seat
* Such was the charge, and such the defence. --Federalist, No. 38, by
Madison,
t November 12, 1783.
t February 14, 1783.
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of congress," much agitated with the suspense* in which he
was held, until the first of April, when Hamilton reported,j-
"that the object of his appointment was so far advanced as
to render his services no longer necessary. "
A mission to Europe was still his favourite aim, and no
more certain mode of obtaining it offered, than a seat in
congress.
The events of the last year had shown that every effort
to conclude a commercial treaty with Great Britain, had
been vain, and if France could have been previously in-
duced to adopt a more liberal policy, the negotiations for
the treaty of peace had dispelled every hope of that kind.
The previous congress had, in conformity with Hamilton's
views, dissuaded a multiplication of pacts with foreign na-
tions, until the confederacy should have been invested
with an efficient control over its members, and until time
and experience should have indicated what system of reg-
ulations would best promote the permanent interests of
the United States. But the recent overtures were to be
met, and when the field of ambition was so circumscribed
at home, nothing could be more attractive than the position
of determining the foreign relations of this youthful em-
pire ; nor more enchanting to a visionary mind, than the
attempt to overturn at once the prevailing maxims of Eu-
ropean diplomacy, and to substitute an universal system of
* December 30, 1782. --" Mr. Jefferson arrived here on Friday last, and
is industriously arming himself for the field of negotiation. The commission
issued to Mr. Oswald impresses him with a hope that he may have nothing to do
on his arrival, but join in the celebration of victory and peace. Congress,
however, anxiously espouse the expediency of his hastening to his destina.
tion. "
March 11,1783. --"Mr. Jefferson is still here, agitated, as you may sup-
pose, with the suspense in which he is kept. He is anxious as myself for
your going into the legislature. "--Madison to Edmund Randolph, vol. 1,
495-514.
t Vol. 1, No. 25, department of state.
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? HAMILTON. 297
free trade. The mode adopted to obtain this object was
as certain to result in failure, as the object was at that time
hopeless. It was a novel idea, and had an imposing air,
to establish a central commission at Paris, whither the na-
tions of Europe might resort, to ask a participation in the
commerce of the new world. Should the dignity of Brit-
ain scorn, or the pride of Spain revolt at the idea of ne-
gotiating under the supervision of France, yet still it
would be a happy thing to escape the turmoils of a jarring
confederacy, to withdraw from the sufferings of a recent
war, and to enjoy the only official emoluments, ease and
honour, which the penury of the people could support. To
others was left the labour of building up the constitution
of the country.
Jefferson introduced a report on the foreign relations.
After reciting the advantages to be derived from treaties
with the various nations of Europe, he proposed that
each treaty should contain a stipulation that each party
should have the right to carry their own produce, manu-
factures, and merchandise, in their own bottoms to the
ports of the other, and thence to take the produce and man-
ufactures of the other, paying such duties only as are paid
by the most favoured nation,--freely, where freely grant-
ed to such nation, and paying the compensation where
such nation does the same. "That with nations hold-
ing possessions in America, a direct and similar inter-
course be admitted between the United States and such
possessions; or if that could not be obtained, a direct and
similar intercourse between the United States and certain
free ports within such possessions. If neither of these--
permission to bring, in their own bottoms, their produce
and merchandise to the United States directly, and similar
permission to the United States as to their produce
and vessels; or else, a permission to the inhabitants of
such possessions to carry their produce and merchandise
38
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THE LIFE OF
in their own bottoms to the free ports of other na-
tions; and thence to take back, directly, the produce and
merchandise of. the United States; and that in all such
treaties, the United States should be regarded as one na-
tion, upon the principles of the federal constitution. " Provis-
ions that free ships should make free goods, defining articles
of contraband and the state of blockade, were also to be
made; with the additional stipulation, that a contraband
trade should not induce confiscation.
Security was also to be assured to persons following
the peaceful arts; and a stipulation that private ships should
continue their trade free and unmolested during war, and
that privateers should not be employed, was proposed.
Aliens were to be excluded holding real estate within the
United States, as "utterly inadmissible by their several laws
and policy ;" but in case they did, it was not on their de-
mise to escheat, but might be sold for the benefit of their
representatives. All treaties were to be limited to ten.
years, unless the foreign party "pertinaciously insisted"
on their being extended to fifteen years. On the dis-
cussion of the leading principles of these instructions,
placing each nation on the footing of the most favoured, a
substitute was offered to establish the intercourse on the
basis of " nativesbut if this could not be obtained, then
on that of "the most favoured nation. " This amendment
was lost on the vote by states, though of the members
present, a majority were in favour of it. * It was also con-
tended that a distinction ought to be made between Brit-
ish and American vessels by a difference of duties. If not
then made, that it was at least important to reserve the
power of making such a discrimination in case pecu-
* Affirmative--Massachusetts, Connecticut, Pennsylvania, Maryland,
Virginia, (three to two,) Jefferson and Monroe in the negative. Negative--
New-Hampshire and New Jersey. Divided--Rhode Island, New-York,
North and South Carolina.
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? HAMILTON.
299
liar circumstances should render its exercise necessary.
Owing to these differences of opinion, it was moved
to postpone acting upon this report until the disposition
and concurrence of the several state legislatures should be
ascertained, which, the motion stated, "the constitution
renders highly prudent, if not indispensably necessary in
forming commercial treaties. "
With this motion a resolution was offered directing
foreign powers to be apprised of the desire of the United
States " to form treaties upon terms of perfect reciprocity
and equality; and for that purpose were ready to enter
into negotiations in America. " Five commissioners had
been appointed to negotiate the treaty with England, thus
representing each important section of the union. To
gain the benefit of this precedent, it had been proposed to
appoint two additional commissioners. One of the objects
of this resolution was, to prevent so unnecessary an in-
crease of the number of foreign ministers. But it was
defeated, and the report of Jefferson was recommitted.
Another report had recently been made proposing a re-
duction of the civil list. It was next moved to postpone
these appointments for the purpose of considering this
report. The division of states being equal, this motion
was also lost. * The idea of two additional commission-
ers was then abandoned, and it was moved to add one to
the existing number.
This proposal was resisted, and in lieu of it a declaratory
resolution was offered, "that the interests of the United
States do not require more than three commissioners
plenipotentiary to be supported in Europe to negotiate
treaties of commerce. " This declaration would have de-
feated Jefferson, and at the instance of Virginia it was
superseded by the previous question. A debate next arose
4 J. c. 396-7.
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on a proposal to reduce the salaries of these ministers,*
which prevailed. To prevent this reduction, a member
from Virginia insisted that it was a proposition which re-
quired the assent of nine states. This extraordinary ob-
jection was defeated, only five members voting for it; but
the next day, at the instance of Gerry, the salary was
established at nine thousand dollars.
Jefferson had recommended a delusive provision for the
public creditors, and had urged "forbearance," on the
ground "that the states were just relieved from the
ravages of predatory armies, returning from an attend-
ance in camps to the culture of their fields; beginning to
sow, but not yet having reaped; exhausted of necessaries
and habitual comforts, and therefore needing new supplies
out of the first proceeds of their labour. " He was also
of the committee which had recommended retrenchments
in the public expenditure, and which did not contemplate
in their report this additional officer.
Under these circumstances, the appointment of an unne-
cessary commissioner was viewed as proceeding solely
from a desire to bestow office on an individual, by a
body of which he was a member, without any regard to
the condition of the country. It gave rise to much dissat-
isfaction. At this moment a letter was received from
Franklin, announcing that Jay had determined to embark
for America. The motive to an increase of the number
of the commission now ceased, and the measure was aban-
doned.
1 The office of secretary of foreign affairs was vacant.
Jay, in his late mission, had confirmed the confidence of the
nation. His appointment to that department would sat-
isfy the public, and propitiate those who were offended
with this gross and glaring effort to provide for a favour-
* From $11,000 to $8,000.
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? HAMILTON.
301
ite. The dissatisfaction given by Jay to the partisans of
France was therefore smothered, and yielded to the present
object; and on the same day, the seventh of May, Jay in his
absence, at the instance of Gerry, was elected to the foreign
department, and with his concurrence Jefferson, on the
motion of a colleague from Virginia, was chosen to fill the
vacancy in the commission.
An occurrence of this kind could not fail to produce
a strong and lasting impression. A twelvemonth after,
Massachusetts urged, through her delegates, a resolution
that no member of congress should be appointed to any
office during the term for which he was elected; and a pro-
vision was inserted in the federal constitution, which would
seem to have had this case in view. It rendered a mem-
ber of congress ineligible " to any civil office that had been
created, or the emolument whereof had been increased, du-
ring the time for which he was elected. "
Jefferson's commercial report was now again brought
forward with some additions. Of these, the most impor-
tant was, that these instructions should be considered as
supplementary to those of October, seventeen hundred and
eighty-three; that where the commissioners should be able
to form treaties on principles in their judgment more ad-
vantageous to the United States than those of the report,
they were permitted to adopt such principles, and that it
would be agreeable to have supplementary treaties with
France, Holland, and Sweden, which may bring the trea-
ties previously entered into, as nearly as may be to the
principles now directed.
Numerous exceptions were taken to a treaty framed on
the principle of these instructions, in a report* subsequently
made to congress by the secretary of foreign affairs.
These are to be regarded, not as exceptions to stipulations
Report of Jay. --2 D. C. 234.
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of the most perfect equality and reciprocity in a particu-
lar treaty with any one nation, where the interest of the
country might dictate them, but as exceptions to the es-
tablishment, at that time, of a general system of policy, ex-
cluding all discriminations or prohibitions, however their
necessfty might be indicated by peculiar circumstances.
Jay thought that a system for regulating the trade of the
United States should be framed and adopted before they
entered into further treaties of commerce. Various rea-
sons were given to show that it was inexpedient to make
the conduct of the parties towards the most favoured na-
tions, the rule of their conduct towards each other; among
these, a principal one was, that the interchange of favours
between the United States and a nation merely European,
would probably be regulated by principles and considera-
tions distinct, in a certain degree, from those which should
regulate such an interchange between them and nations
partly European and partly American. * There might, he
said, exist reasons for freely granting to one nation what
there might be no reason for granting to another. He
also doubted the expediency of agreeing absolutely that
any nation should be at liberty to bring and vend into the
United States, all or any of their productions and manufac-
tures witlwut exception, because it might be necessary to
prohibit the importation of some of them, either to check
luxury, or to promote domestic manufactures. f
* "We abstained," Jefferson observed, "from making new propositions to
others having no colonies, because our commerce being an exchange of raw
for wrought materials, is a competent price for admission into the colonics
of those possessing them; but were we to give it without price to others,
all would claim it without price, on the ordinary ground of gentis nmicis-
simtB. "--Jefferson's Works, vol. 1, p. 51.
t In the treaty which was the immediate subject of this report, one arti.
cle precluded the laying an embargo. This was objected to, for a reason not
easily disputed.
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? HAMILTON.
303
But one other topic of moment arrests attention in
the proceedings of this congress. It related to the garri-
soning of the frontier posts. The hostility evinced by
New-York to the employment of continental troops for
that purpose, has been previously mentioned. The expec-
tation that the negotiation which was pending for the sur-
render of those posts would be successful, produced great
anxiety in the councils of that state, and she urged, with
extreme earnestness and pertinacity, a declaration by con-
gress, in pursuance of the articles of confederation, of the
number of troops necessary to be kept up by her for the
protection of her frontier. This subject, though frequently
presented to that body, was deferred from an apprehension
of authorizing an individual state to maintain an armed
force. To avoid this alternative, propositions were made
in congress for the enlistment of a thousand men, to protect
the commissioners recently appointed to hold treaties with
the Indians, and to defend the frontiers.
The fate of these propositions is indicative of the tem-
per of the times. After repeated and laboured debates, a
resolution was introduced by Gerry, proclaiming "the
danger of confiding to a body, which was already empow-
ered to make foreign and domestic loans, and to issue bills
of credit, that of raising standing armies;" and it was de-
termined to discharge the few troops which had been
retained in the service of the United States. The stand-
ing army was reduced to eighty men. No officer was re-
tained of a higher rank than captain, and the western
frontiers were to be protected by a requisition for a regi-
ment of militia. The congress of the United States having,
in virtue of the confederation, at the instance of Jefferson,
chosen from its own body a " committee of the states," now
adjourned.
This committee continued in session, though without
effecting any thing, until the nineteenth of August, seven-
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teen hundred and eighty-four, when some of the members
withdrawing, without the consent of their colleagues, it
broke up, without the decency of an adjournment, in cla-
morous confusion, leaving the nation without any repre-
sentative council.
The congressional year of their successors commenced
on the first of November, of the same year, but a quo-
rum was not formed until the succeeding month. Its
history is alike barren of interest; the few subjects
upon which it acted, until the latter part of its session,
being the organization of a court to adjudicate upon
the territorial controversy which existed between the
states of Massachusetts and New-York; measures for the
adjustment of a similar dispute between South Carolina
and Georgia; the appointment of commissioners to treat
with the southwestern tribes of Indians; the selection of a
site for a federal city, and an ordinance defining the pow-
er and duties of the secretary at war.
These being arranged,
a decision was made upon a matter of permanent impor-
tance--the mode of disposing of the western territory.
Much discussion on this subject had occurred during the
previous congress. An ordinance was now passed," the re-
sult of compromise, not such as was desired, produced by
the utmost efforts of public argument and private solici-
tation. "*
A provision for the current service gave rise also to fre-
quent deliberations, which were concluded by a vote on
the report of the grand committee of congress, a short time
before the termination of its political existence. By this
vote a requisition was made upon the states for three mil-
lions of dollars, of which two-thirds were receivable in
* From a letter of William S. Johnson, a man of a probity and talent as
eminent, and views as comprehensive, as were those of his distinguished fa.
ther.
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? HAMILTON.
305
certificates for interest on the liquidated debts; which
amount was intended, not only to meet the demands of the
year, but also the balance of the estimate which the pre-
ceding congress had omitted to require. An earnest re-
commendation was also made for the completion of the
measures for raising revenue, proposed in seventeen hun-
dred and eighty-three, " as preferable to any other system,
and necessary to the establishment of the public credit. "
Jefferson meanwhile had proceeded to Paris, intent
? \pon his project "to emancipate commerce. " The joint
commission was opened with much solemnity on the thir-
teenth of August, 1784, and soon after its powers were
announced to the different governments of Europe--France,
Great Britain, Denmark, Germany, Prussia, Sweden,
Spain, Portugal, Russia, Saxony, the Sicilies, Sardinia,
Tuscany, Genoa, Venice, Morocco,Algiers, Tripoli, Tunis,
the sublime porte, and his holiness the Pope!
France received them with a smile; England silenced
the experiment by an inquiry as to " the real nature of
the powers with which they were invested, whether they
were merely commissioned by congress, or had received
separate powers from the respective states. " The other
nations stood aloof. Prussia alone formed a treaty embra-
cing some of the principles of the report, but insisted upon
reserving the right of prohibition and retaliation--rights
which the American commissioners themselves claimed to
reserve in their negotiations with Tuscany! The commis-
sion, thus baffled in all its expectations, ceased to act. *
The introduction of a new power into the great family
? Jefferson relates--" Denmark and Tuscany entered also into negotia-
tions with us; other powers appearing indifferent, we did not think it pro-
per to press them. The negotiations, begun with Denmark and Tuscany, we
protracted designedly, until our powers had expired. "--Jefferson's Works,
v. 1, p. 51. The details of this commission may be found in the six reports
to congress, with the accompanying correspondence. --2 D. G. 193 to 347.
39
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of nations, would seem to have been an event fraught with
the most important and immediate interest to the civilized
world, and an American might have hoped to have seen
her vast prospective greatness attracting the eyes of Eu-
rope, and commanding all its attention. But the impo-
tence of the confederacy and the visionary objects of this
commission defeated those hopes. From these causes a
larger view of our foreign relations would seem unneces-
sary, were it not for the powerful influence which the
policy of the great leading powers produced on the social
condition of the American states.
Those with France, their ancient ally, first attract atten-
tion. Nothing is more obvious in all her policy than the
sagacity of her statesmen, who foresaw that the moment
her political influence over the confederacy ceased, every
other connection would become a minor consideration.
Hence her solicitude that all the American negotiations
should be conducted near her court. But England and
Spain were both unwilling that Paris should be the centre
of political action. Great Britain insisted as a previous
condition to any negotiation an embassy to London, "as
more suitable to the dignity of either power. " The Span-
ish minister declared, that in matters between its crown
and any other power, " the custom of its court (the most
regular and systematic of all others) was to negotiate be-
tween themselves, without availing themselves of a third
place. " Franklin having resigned his seat in the commis-
sion, Adams, in consequence of these intimations, was ac-
credited to the court of St. James; Jefferson to that of
Versailles; and Spain appointed a sort of intermediate
minister--a "plenipotentiary charge d'affaires," to reside
at the seat of congress.
While the force of habit formed during her colonial
relations, similarity of language, laws, and manners, all
attracted the American people to England, other causes
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? HAMILTON.
307
operated as insuperable obstacles to an extensive com-
merce between the United States and France.
The poverty of the American people denied to them the
luxuries of their ally. The inferior fabric and peculiar
fashion of articles of primary necessity, prevented their
being introduced into general use. For those which were
sought, few American products would be received in ex-
change; while the commercial system of France, yet in
its infancy, charged the objects of commerce with such a
multiplicity of duties, and those so oppressive as to deter
enterprise. The principal article of exchange was the
subject of a monopoly, and charged with a duty to the
crown, of too much value to be relinquished by a needy
monarch. * On other articles accumulated duties were le-
vied, and these were partitioned among so many recipients,
as placed it beyond the power of the financier to reduce
them to one denomination; while the political influence
of the beneficiaries would not permit them to be diminished
or suppressed. These were some of the embarrassments
to a direct trade. The colonial trade had been long con-
ducted under a most rigid system, and as the treaty of
seventeen hundred and seventy-eight had secured to France
the free admission of her manufactures into the United
States, they had nothing to offer in the shape of immunities
to open the sealed commerce of her islands. f
Soon after his return to Europe, La Fayette, at whose
* Tobacco yielded twenty. eight millions. It constituted one-third of the
whole exports of the United States prior to the revolution.
t Compelled by necessity, France opened her colonial ports during the war,
but at its close, by an arret, dated thirtieth of August, seventeen hundred and
eighty-four, she permitted the importation into them only of a few articles of
primary necessity, and confined the exports to rum, molasses, and goods
brought from France, which paid Hie local duties with an iidvalorem of one
per cent. A discriminating duty was also imposed on salted beef and dried
fish, to form a fund for the encouragement of the French fisheries.
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instance the free ports stipulated in the treaty of seventeen
hundred and seventy-eight were designated, made strong
representations to his court of the benefits to be anticipated
from enlarging the commercial intercourse of the two
countries. The representations were renewed by Jeffer-
son often and with much detail, but the progress of the
negotiation was slow--indicative of the altered temper
of Vergennes, from his failure to control the definitive
treaty with England--and attended with circumstances not
a little wounding to American pride.
The first letter addressed to that minister received no
other answer than that it had been transmitted to the
comptroller-general. To subsequent communications it
was replied, "that not a sufficient dependence could be
placed on arrangements taken with us;" and an act of one
of the states, by which a discrimination of duties was made
between natives and foreigners, became the subject of a
letter from the premier, which, after reproaching the
American minister with a disregard of reciprocity in our
navigation laws and commercial regulations, closed with a
threat, " that the king will be under the necessity, contrary
to his wishes, to fall upon such means as will tend to put
matters upon a perfect equality. "*
These complaints were referred to the secretary of fo-
reign affairs, whose report admitted that the French mer-
chants enjoyed fewer privileges than the merchants of the
United States did in France, and that the act of Massachu-
setts " had deviated both from the letter and spirit of the
treaty. "f While the impotence of the confederation thus
subjected it to the just reproach of a breach of faith to-
wards their ally, it also gave rise to reclamations for indi-
vidual claims, the justice whereof could not be denied, and
which there were no means to discharge. The disappoint-
* 2 D. c. 488.
t 1 D. C. 243.
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? HAMILTON.
309
ments that followed produced great irritation among the
French residents in the United States, which extended to
her legation, and drew from them remonstrances, wherein
the respect due to an independent government was often
forgotten.
In vain did congress renew their assurances of eventual
payment, founded on the good faith of the states. Dis-
criminations in the provision for the interest on their
debts, from which provision foreigners were expressly ex-
cluded by some of the states, were pointed out, and the
very ground on which the delay of justice was excused,
the inability to compel the collection of taxes, gave rise to
the taunting inquiry, "Is there one, or are there eleven
republics V
It being a leading maxim in Jefferson's politics " to mul-
tiply the points of contact and connection" with France,
it will be seen, that he used every means to promote inter-
course with a people whose habits, manners, tastes, and
morals he admired.
The insufficient provision for the interest and instal-
ments then due of the debt to France, led to a proposition
to purchase it. The terms of this proposition are found in
the secret journal of congress of the second of October,
seventeen hundred and eighty-seven, giving an extract of
a letter from Jefferson to the secretary of foreign affairs:--
"That a proposition has been made to Monsieur de Ca-
lonne, minister of the finances of France, by a company
of Dutch merchants, to purchase the debt due from the
United States to the crown of France; giving for the said
debt, amounting to twenty-four millions of livres, the sum
of twenty millions of livres. That information of this
proposition has been given to him by the agent of the
said company, with the view of ascertaining whether the
proposed negotiation would be agreeable to congress.
That the said minister suggests, 'that if there is a danger
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of the public payments not being punctual, whether it might
not be better that the discontents which would then arise,
should be transferred from a court of whose good will we
have so much need, to the breasts of a private company. '
That the credit of the United States is sound in Holland;
and that it would probably not be difficult to borrow in
that country the whole sum of money due to the court of
France, and to discharge that debt without any deduc-
tion; thereby doing what would be grateful to the court,
and establishing with them a confidence in our honour. "*
This subject was resumed in a letter from Jefferson to
Jay of the twelfth of November following-f He wrote:
"In a letter which I had the honour of writing you on the
twenty-sixth December, I informed you that a Dutch com-
pany were making propositions to the minister of France
here, to purchase at a discount the debt due from the Uni-
ted States to this country. I have lately procured a copy
of their memoir, which I now enclose. Should congress
think this subject worthy their attention, they have no
time to lose, as the necessities of the minister, which alone
have made him to listen to this proposition, may force him
to a speedy conclusion. "
The former of these letters was referred to the board
of Treasury, who on the second of October of the follow-
ing year made a report; which, after reciting the previous
extracts of the letter of Jefferson, contains comments full
of meaning:--
"That at the time the debt due from the United States
to the crown of France was contracted, it could not have
been foreseen that the different members of the union
would have hesitated to make effectual provision for the
discharge of the same, since it had been contracted for
the security of the lives, liberties, and property of their
* 4 S. J. 386.
t 3 D. C. 175.
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? HAMILTON.
311
several citizens, who had solemnly pledged themselves for
its redemption; and that, therefore, the honour of the
United States cannot be impeached, for having authorizea
their minister at the court of France to enter into a formal
convention, acknowledging the amount of the said debt,
and stipulating for the reimbursement of the principal and
interest due thereon.
"That should the United States at this period give any
sanction to the transfer of this debt, or attempt to make a
loan in Holland for the discharge of the same, the persons
interested in the transfer, or in the loan, would have rea-
son to presume that the United States in congress would
make effectual provision for the punctual payment of the
principal and interest.
"That the prospect of such provision being made within
a short period, is by no means flattering; and though the
credit of the United States is still sound in Holland, from
the exertions which have been made to discharge the in-
terest due to the subscribers to the loans in that country,
yet, in the opinion of this board, it would be unjust as well
as impolitic, to give any public sanction to the proposed
negotiation. Unjust, because the nation would contract
an engagement without any well-grounded expectation of
discharging it with proper punctuality. Impolitic, because
a failure in the payment of interest accruing from this ne-
gotiation (which would inevitably happen) would justly
blast all hopes of credit with the citizens of the United
Netherlands, when the exigencies of the union might ren-
der new loans indispensably necessary.
"The board beg leave further to observe, that although a
grateful sense of the services rendered by the court of
France, would undoubtedly induce the United States in
congress to make every possible exertion for the reim-
bursement of the moneys advanced by his most christian
majesty, yet, that they cannot presume that it would tend
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? 312 THE LIFE OF
<<
to establish in the mind of the French court an idea of
the national honour of this country, to involve individuals
in a heavy loan, at a time when congress were fully sensi-
ble that their resources were altogether inadequate to dis-
charge even the interest of the- same,* much less the instal-
ments of the principal, which would from time to time be-
come due. How far the idea of transferring the discontents
which may prevail in the French court, for the want of the
punctual payment of interest, to the breast of the private
citizens of Holland, would be consistent with sound policy,
the board forbear to enlarge on.
"It may be proper, however, to observe, that the public
integrity of a nation is the best shield of defence against
any calamities to which, in the course of human events, she
may find herself exposed.
"This principle, so far as it respects the conduct of the
United States in contracting the loans with France, cannot
be called in question. The reverse would be the case,
should the sanction of the United States be given either
to the transfer of the French debt, or to the negotiation of
a loan in Holland for the purpose of discharging it.
"If it be further considered, that the consequences of a
failure in the punctual payment of interest on the moneys
borrowed by the United States, can by no means be so
distressing to a nation, (and one powerful in resources,) as
it would be to individuals, whose dependence for support
is frequently on the interest of the moneys loaned, the
board presume that the proposed negotiation cannot be
considered at the present juncture, in any point of view,
either as eligible or proper. Under these circumstances,
* Jefferson wrote to Carmichael at Madrid, June 14, 1787 :--" New-York
still refuses to pass the impost in any form, and were she to pass it, Pennsyl-
vania will not uncouple it from the supplementary funds. These two states
and Virginia, are the only ones, my letters say, which have paid any thing
into the continental trcasary for a twelvemonth past. "
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? HAMILTON. 313
they submit it as their opinion, " that it would be proper
without delay to instruct the minister of the United States
at the court of France,* not to give any sanction to any
negotiation which may be proposed for transferring the
debt due from the United States, to any state, or compa-
ny of individuals, who may be disposed to purchase the
same. "
So jealous were congress of the injury which this pro-
position might inflict on the national character, that on the
day on which this report is dated, they instantly passed
an act instructing Jefferson not to promote any negotia-
tion for transferring the debt due to France from the
United States. f
Thus the national honour was saved, but the lure had
succeeded. In prosecution of the project, a letter was ad-
dressed by Jefferson to Dumas,J to ascertain its practica-
bility; whose reply evinced a preference of a purchase
for a sum less than its face, to a loan for the whole amount,
and urged prompt action, stating that the sacrifice on
the part of France, would be very small. An arret was
accordingly framed and submitted to Calonne. That min-
ister, grasping at such a prospect of relief from his finan-
cial difficulties, soon after this purchase was suggested,
addressed a letter to Jefferson, giving the assurance that
the monopolies on particular articles would not be renew-
ed, and that the duties on most of the imports, the growth
of the United States, in French or American vessels, were
"suppressed. "? The execution of this arrangement was,
? 3D. C. 183. t3D. C. 289.
X Dumas had a pension from France, revertible to his daughter.
? 3 Dip. Cor. 163. --Oct. 22,1786. --Tins letter also states, that as Virginia
had ordered arms for her militia from France, the duties and prohibition of
them should be abolished. Similar supplies had been furnished by France
to her during the war, which gave rise to questions in the settlement of the
accounts. A more serious difficulty grew out of an act of that state, passed
pending Jefferson's negotiation about the debt, giving a preference to French
40
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? 314 THE LIFE OF
?
? HAMILTON.
295
port was from Jefferson, Chase, and Howell. It is to be
remarked, that it embodied a proviso for the exclusion of
slavery in the contemplated states, after the commence-
ment of the nineteenth century, which, though sustained
by the votes of all (but the southern states,) and by those
of Jefferson and Williamson, was expunged. This report
is a remarkable event in the history of its author. It con-
templated an exercise of the highest powers of govern-
ment; nothing less than the creation of independent
states; their admission as members of the confederacy,
and the determination of the conditions of such admission.
But it was an exercise of powers not delegated to the
confederation ! " All this was done without the least col-
our of constitutional authority; yet no blame was whisper-
ed, no alarm sounded. The public interest, the necessity
of the case, imposed upon congress the task of overleaping
their constitutional authority. "*
It has been previously mentioned that Jefferson had re-
paired to Philadelphia the preceding year, with a view to
his embarcation as a joint commissioner in the negotiation
at Paris. He was appointedf on motion of Madison, it
being suggested that a recent domestic calamity had
probably changed his sentiments with regard to public
life; that " all the reasons for his original appointment still
existed, and had acquired additional force from the im-
probability that Laurens would actually assist in the ne-
gotiation. ":); The intelligence from Europe led to a reso-
lution, that he must " not proceed on his intended voyage
until further instructions. " Though he hoped there was
no prospect of his having any thing more to do than to
join in the celebration of peace, he remained near the seat
* Such was the charge, and such the defence. --Federalist, No. 38, by
Madison,
t November 12, 1783.
t February 14, 1783.
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of congress," much agitated with the suspense* in which he
was held, until the first of April, when Hamilton reported,j-
"that the object of his appointment was so far advanced as
to render his services no longer necessary. "
A mission to Europe was still his favourite aim, and no
more certain mode of obtaining it offered, than a seat in
congress.
The events of the last year had shown that every effort
to conclude a commercial treaty with Great Britain, had
been vain, and if France could have been previously in-
duced to adopt a more liberal policy, the negotiations for
the treaty of peace had dispelled every hope of that kind.
The previous congress had, in conformity with Hamilton's
views, dissuaded a multiplication of pacts with foreign na-
tions, until the confederacy should have been invested
with an efficient control over its members, and until time
and experience should have indicated what system of reg-
ulations would best promote the permanent interests of
the United States. But the recent overtures were to be
met, and when the field of ambition was so circumscribed
at home, nothing could be more attractive than the position
of determining the foreign relations of this youthful em-
pire ; nor more enchanting to a visionary mind, than the
attempt to overturn at once the prevailing maxims of Eu-
ropean diplomacy, and to substitute an universal system of
* December 30, 1782. --" Mr. Jefferson arrived here on Friday last, and
is industriously arming himself for the field of negotiation. The commission
issued to Mr. Oswald impresses him with a hope that he may have nothing to do
on his arrival, but join in the celebration of victory and peace. Congress,
however, anxiously espouse the expediency of his hastening to his destina.
tion. "
March 11,1783. --"Mr. Jefferson is still here, agitated, as you may sup-
pose, with the suspense in which he is kept. He is anxious as myself for
your going into the legislature. "--Madison to Edmund Randolph, vol. 1,
495-514.
t Vol. 1, No. 25, department of state.
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? HAMILTON. 297
free trade. The mode adopted to obtain this object was
as certain to result in failure, as the object was at that time
hopeless. It was a novel idea, and had an imposing air,
to establish a central commission at Paris, whither the na-
tions of Europe might resort, to ask a participation in the
commerce of the new world. Should the dignity of Brit-
ain scorn, or the pride of Spain revolt at the idea of ne-
gotiating under the supervision of France, yet still it
would be a happy thing to escape the turmoils of a jarring
confederacy, to withdraw from the sufferings of a recent
war, and to enjoy the only official emoluments, ease and
honour, which the penury of the people could support. To
others was left the labour of building up the constitution
of the country.
Jefferson introduced a report on the foreign relations.
After reciting the advantages to be derived from treaties
with the various nations of Europe, he proposed that
each treaty should contain a stipulation that each party
should have the right to carry their own produce, manu-
factures, and merchandise, in their own bottoms to the
ports of the other, and thence to take the produce and man-
ufactures of the other, paying such duties only as are paid
by the most favoured nation,--freely, where freely grant-
ed to such nation, and paying the compensation where
such nation does the same. "That with nations hold-
ing possessions in America, a direct and similar inter-
course be admitted between the United States and such
possessions; or if that could not be obtained, a direct and
similar intercourse between the United States and certain
free ports within such possessions. If neither of these--
permission to bring, in their own bottoms, their produce
and merchandise to the United States directly, and similar
permission to the United States as to their produce
and vessels; or else, a permission to the inhabitants of
such possessions to carry their produce and merchandise
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? 298
THE LIFE OF
in their own bottoms to the free ports of other na-
tions; and thence to take back, directly, the produce and
merchandise of. the United States; and that in all such
treaties, the United States should be regarded as one na-
tion, upon the principles of the federal constitution. " Provis-
ions that free ships should make free goods, defining articles
of contraband and the state of blockade, were also to be
made; with the additional stipulation, that a contraband
trade should not induce confiscation.
Security was also to be assured to persons following
the peaceful arts; and a stipulation that private ships should
continue their trade free and unmolested during war, and
that privateers should not be employed, was proposed.
Aliens were to be excluded holding real estate within the
United States, as "utterly inadmissible by their several laws
and policy ;" but in case they did, it was not on their de-
mise to escheat, but might be sold for the benefit of their
representatives. All treaties were to be limited to ten.
years, unless the foreign party "pertinaciously insisted"
on their being extended to fifteen years. On the dis-
cussion of the leading principles of these instructions,
placing each nation on the footing of the most favoured, a
substitute was offered to establish the intercourse on the
basis of " nativesbut if this could not be obtained, then
on that of "the most favoured nation. " This amendment
was lost on the vote by states, though of the members
present, a majority were in favour of it. * It was also con-
tended that a distinction ought to be made between Brit-
ish and American vessels by a difference of duties. If not
then made, that it was at least important to reserve the
power of making such a discrimination in case pecu-
* Affirmative--Massachusetts, Connecticut, Pennsylvania, Maryland,
Virginia, (three to two,) Jefferson and Monroe in the negative. Negative--
New-Hampshire and New Jersey. Divided--Rhode Island, New-York,
North and South Carolina.
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? HAMILTON.
299
liar circumstances should render its exercise necessary.
Owing to these differences of opinion, it was moved
to postpone acting upon this report until the disposition
and concurrence of the several state legislatures should be
ascertained, which, the motion stated, "the constitution
renders highly prudent, if not indispensably necessary in
forming commercial treaties. "
With this motion a resolution was offered directing
foreign powers to be apprised of the desire of the United
States " to form treaties upon terms of perfect reciprocity
and equality; and for that purpose were ready to enter
into negotiations in America. " Five commissioners had
been appointed to negotiate the treaty with England, thus
representing each important section of the union. To
gain the benefit of this precedent, it had been proposed to
appoint two additional commissioners. One of the objects
of this resolution was, to prevent so unnecessary an in-
crease of the number of foreign ministers. But it was
defeated, and the report of Jefferson was recommitted.
Another report had recently been made proposing a re-
duction of the civil list. It was next moved to postpone
these appointments for the purpose of considering this
report. The division of states being equal, this motion
was also lost. * The idea of two additional commission-
ers was then abandoned, and it was moved to add one to
the existing number.
This proposal was resisted, and in lieu of it a declaratory
resolution was offered, "that the interests of the United
States do not require more than three commissioners
plenipotentiary to be supported in Europe to negotiate
treaties of commerce. " This declaration would have de-
feated Jefferson, and at the instance of Virginia it was
superseded by the previous question. A debate next arose
4 J. c. 396-7.
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on a proposal to reduce the salaries of these ministers,*
which prevailed. To prevent this reduction, a member
from Virginia insisted that it was a proposition which re-
quired the assent of nine states. This extraordinary ob-
jection was defeated, only five members voting for it; but
the next day, at the instance of Gerry, the salary was
established at nine thousand dollars.
Jefferson had recommended a delusive provision for the
public creditors, and had urged "forbearance," on the
ground "that the states were just relieved from the
ravages of predatory armies, returning from an attend-
ance in camps to the culture of their fields; beginning to
sow, but not yet having reaped; exhausted of necessaries
and habitual comforts, and therefore needing new supplies
out of the first proceeds of their labour. " He was also
of the committee which had recommended retrenchments
in the public expenditure, and which did not contemplate
in their report this additional officer.
Under these circumstances, the appointment of an unne-
cessary commissioner was viewed as proceeding solely
from a desire to bestow office on an individual, by a
body of which he was a member, without any regard to
the condition of the country. It gave rise to much dissat-
isfaction. At this moment a letter was received from
Franklin, announcing that Jay had determined to embark
for America. The motive to an increase of the number
of the commission now ceased, and the measure was aban-
doned.
1 The office of secretary of foreign affairs was vacant.
Jay, in his late mission, had confirmed the confidence of the
nation. His appointment to that department would sat-
isfy the public, and propitiate those who were offended
with this gross and glaring effort to provide for a favour-
* From $11,000 to $8,000.
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? HAMILTON.
301
ite. The dissatisfaction given by Jay to the partisans of
France was therefore smothered, and yielded to the present
object; and on the same day, the seventh of May, Jay in his
absence, at the instance of Gerry, was elected to the foreign
department, and with his concurrence Jefferson, on the
motion of a colleague from Virginia, was chosen to fill the
vacancy in the commission.
An occurrence of this kind could not fail to produce
a strong and lasting impression. A twelvemonth after,
Massachusetts urged, through her delegates, a resolution
that no member of congress should be appointed to any
office during the term for which he was elected; and a pro-
vision was inserted in the federal constitution, which would
seem to have had this case in view. It rendered a mem-
ber of congress ineligible " to any civil office that had been
created, or the emolument whereof had been increased, du-
ring the time for which he was elected. "
Jefferson's commercial report was now again brought
forward with some additions. Of these, the most impor-
tant was, that these instructions should be considered as
supplementary to those of October, seventeen hundred and
eighty-three; that where the commissioners should be able
to form treaties on principles in their judgment more ad-
vantageous to the United States than those of the report,
they were permitted to adopt such principles, and that it
would be agreeable to have supplementary treaties with
France, Holland, and Sweden, which may bring the trea-
ties previously entered into, as nearly as may be to the
principles now directed.
Numerous exceptions were taken to a treaty framed on
the principle of these instructions, in a report* subsequently
made to congress by the secretary of foreign affairs.
These are to be regarded, not as exceptions to stipulations
Report of Jay. --2 D. C. 234.
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of the most perfect equality and reciprocity in a particu-
lar treaty with any one nation, where the interest of the
country might dictate them, but as exceptions to the es-
tablishment, at that time, of a general system of policy, ex-
cluding all discriminations or prohibitions, however their
necessfty might be indicated by peculiar circumstances.
Jay thought that a system for regulating the trade of the
United States should be framed and adopted before they
entered into further treaties of commerce. Various rea-
sons were given to show that it was inexpedient to make
the conduct of the parties towards the most favoured na-
tions, the rule of their conduct towards each other; among
these, a principal one was, that the interchange of favours
between the United States and a nation merely European,
would probably be regulated by principles and considera-
tions distinct, in a certain degree, from those which should
regulate such an interchange between them and nations
partly European and partly American. * There might, he
said, exist reasons for freely granting to one nation what
there might be no reason for granting to another. He
also doubted the expediency of agreeing absolutely that
any nation should be at liberty to bring and vend into the
United States, all or any of their productions and manufac-
tures witlwut exception, because it might be necessary to
prohibit the importation of some of them, either to check
luxury, or to promote domestic manufactures. f
* "We abstained," Jefferson observed, "from making new propositions to
others having no colonies, because our commerce being an exchange of raw
for wrought materials, is a competent price for admission into the colonics
of those possessing them; but were we to give it without price to others,
all would claim it without price, on the ordinary ground of gentis nmicis-
simtB. "--Jefferson's Works, vol. 1, p. 51.
t In the treaty which was the immediate subject of this report, one arti.
cle precluded the laying an embargo. This was objected to, for a reason not
easily disputed.
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? HAMILTON.
303
But one other topic of moment arrests attention in
the proceedings of this congress. It related to the garri-
soning of the frontier posts. The hostility evinced by
New-York to the employment of continental troops for
that purpose, has been previously mentioned. The expec-
tation that the negotiation which was pending for the sur-
render of those posts would be successful, produced great
anxiety in the councils of that state, and she urged, with
extreme earnestness and pertinacity, a declaration by con-
gress, in pursuance of the articles of confederation, of the
number of troops necessary to be kept up by her for the
protection of her frontier. This subject, though frequently
presented to that body, was deferred from an apprehension
of authorizing an individual state to maintain an armed
force. To avoid this alternative, propositions were made
in congress for the enlistment of a thousand men, to protect
the commissioners recently appointed to hold treaties with
the Indians, and to defend the frontiers.
The fate of these propositions is indicative of the tem-
per of the times. After repeated and laboured debates, a
resolution was introduced by Gerry, proclaiming "the
danger of confiding to a body, which was already empow-
ered to make foreign and domestic loans, and to issue bills
of credit, that of raising standing armies;" and it was de-
termined to discharge the few troops which had been
retained in the service of the United States. The stand-
ing army was reduced to eighty men. No officer was re-
tained of a higher rank than captain, and the western
frontiers were to be protected by a requisition for a regi-
ment of militia. The congress of the United States having,
in virtue of the confederation, at the instance of Jefferson,
chosen from its own body a " committee of the states," now
adjourned.
This committee continued in session, though without
effecting any thing, until the nineteenth of August, seven-
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teen hundred and eighty-four, when some of the members
withdrawing, without the consent of their colleagues, it
broke up, without the decency of an adjournment, in cla-
morous confusion, leaving the nation without any repre-
sentative council.
The congressional year of their successors commenced
on the first of November, of the same year, but a quo-
rum was not formed until the succeeding month. Its
history is alike barren of interest; the few subjects
upon which it acted, until the latter part of its session,
being the organization of a court to adjudicate upon
the territorial controversy which existed between the
states of Massachusetts and New-York; measures for the
adjustment of a similar dispute between South Carolina
and Georgia; the appointment of commissioners to treat
with the southwestern tribes of Indians; the selection of a
site for a federal city, and an ordinance defining the pow-
er and duties of the secretary at war.
These being arranged,
a decision was made upon a matter of permanent impor-
tance--the mode of disposing of the western territory.
Much discussion on this subject had occurred during the
previous congress. An ordinance was now passed," the re-
sult of compromise, not such as was desired, produced by
the utmost efforts of public argument and private solici-
tation. "*
A provision for the current service gave rise also to fre-
quent deliberations, which were concluded by a vote on
the report of the grand committee of congress, a short time
before the termination of its political existence. By this
vote a requisition was made upon the states for three mil-
lions of dollars, of which two-thirds were receivable in
* From a letter of William S. Johnson, a man of a probity and talent as
eminent, and views as comprehensive, as were those of his distinguished fa.
ther.
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? HAMILTON.
305
certificates for interest on the liquidated debts; which
amount was intended, not only to meet the demands of the
year, but also the balance of the estimate which the pre-
ceding congress had omitted to require. An earnest re-
commendation was also made for the completion of the
measures for raising revenue, proposed in seventeen hun-
dred and eighty-three, " as preferable to any other system,
and necessary to the establishment of the public credit. "
Jefferson meanwhile had proceeded to Paris, intent
? \pon his project "to emancipate commerce. " The joint
commission was opened with much solemnity on the thir-
teenth of August, 1784, and soon after its powers were
announced to the different governments of Europe--France,
Great Britain, Denmark, Germany, Prussia, Sweden,
Spain, Portugal, Russia, Saxony, the Sicilies, Sardinia,
Tuscany, Genoa, Venice, Morocco,Algiers, Tripoli, Tunis,
the sublime porte, and his holiness the Pope!
France received them with a smile; England silenced
the experiment by an inquiry as to " the real nature of
the powers with which they were invested, whether they
were merely commissioned by congress, or had received
separate powers from the respective states. " The other
nations stood aloof. Prussia alone formed a treaty embra-
cing some of the principles of the report, but insisted upon
reserving the right of prohibition and retaliation--rights
which the American commissioners themselves claimed to
reserve in their negotiations with Tuscany! The commis-
sion, thus baffled in all its expectations, ceased to act. *
The introduction of a new power into the great family
? Jefferson relates--" Denmark and Tuscany entered also into negotia-
tions with us; other powers appearing indifferent, we did not think it pro-
per to press them. The negotiations, begun with Denmark and Tuscany, we
protracted designedly, until our powers had expired. "--Jefferson's Works,
v. 1, p. 51. The details of this commission may be found in the six reports
to congress, with the accompanying correspondence. --2 D. G. 193 to 347.
39
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of nations, would seem to have been an event fraught with
the most important and immediate interest to the civilized
world, and an American might have hoped to have seen
her vast prospective greatness attracting the eyes of Eu-
rope, and commanding all its attention. But the impo-
tence of the confederacy and the visionary objects of this
commission defeated those hopes. From these causes a
larger view of our foreign relations would seem unneces-
sary, were it not for the powerful influence which the
policy of the great leading powers produced on the social
condition of the American states.
Those with France, their ancient ally, first attract atten-
tion. Nothing is more obvious in all her policy than the
sagacity of her statesmen, who foresaw that the moment
her political influence over the confederacy ceased, every
other connection would become a minor consideration.
Hence her solicitude that all the American negotiations
should be conducted near her court. But England and
Spain were both unwilling that Paris should be the centre
of political action. Great Britain insisted as a previous
condition to any negotiation an embassy to London, "as
more suitable to the dignity of either power. " The Span-
ish minister declared, that in matters between its crown
and any other power, " the custom of its court (the most
regular and systematic of all others) was to negotiate be-
tween themselves, without availing themselves of a third
place. " Franklin having resigned his seat in the commis-
sion, Adams, in consequence of these intimations, was ac-
credited to the court of St. James; Jefferson to that of
Versailles; and Spain appointed a sort of intermediate
minister--a "plenipotentiary charge d'affaires," to reside
at the seat of congress.
While the force of habit formed during her colonial
relations, similarity of language, laws, and manners, all
attracted the American people to England, other causes
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? HAMILTON.
307
operated as insuperable obstacles to an extensive com-
merce between the United States and France.
The poverty of the American people denied to them the
luxuries of their ally. The inferior fabric and peculiar
fashion of articles of primary necessity, prevented their
being introduced into general use. For those which were
sought, few American products would be received in ex-
change; while the commercial system of France, yet in
its infancy, charged the objects of commerce with such a
multiplicity of duties, and those so oppressive as to deter
enterprise. The principal article of exchange was the
subject of a monopoly, and charged with a duty to the
crown, of too much value to be relinquished by a needy
monarch. * On other articles accumulated duties were le-
vied, and these were partitioned among so many recipients,
as placed it beyond the power of the financier to reduce
them to one denomination; while the political influence
of the beneficiaries would not permit them to be diminished
or suppressed. These were some of the embarrassments
to a direct trade. The colonial trade had been long con-
ducted under a most rigid system, and as the treaty of
seventeen hundred and seventy-eight had secured to France
the free admission of her manufactures into the United
States, they had nothing to offer in the shape of immunities
to open the sealed commerce of her islands. f
Soon after his return to Europe, La Fayette, at whose
* Tobacco yielded twenty. eight millions. It constituted one-third of the
whole exports of the United States prior to the revolution.
t Compelled by necessity, France opened her colonial ports during the war,
but at its close, by an arret, dated thirtieth of August, seventeen hundred and
eighty-four, she permitted the importation into them only of a few articles of
primary necessity, and confined the exports to rum, molasses, and goods
brought from France, which paid Hie local duties with an iidvalorem of one
per cent. A discriminating duty was also imposed on salted beef and dried
fish, to form a fund for the encouragement of the French fisheries.
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instance the free ports stipulated in the treaty of seventeen
hundred and seventy-eight were designated, made strong
representations to his court of the benefits to be anticipated
from enlarging the commercial intercourse of the two
countries. The representations were renewed by Jeffer-
son often and with much detail, but the progress of the
negotiation was slow--indicative of the altered temper
of Vergennes, from his failure to control the definitive
treaty with England--and attended with circumstances not
a little wounding to American pride.
The first letter addressed to that minister received no
other answer than that it had been transmitted to the
comptroller-general. To subsequent communications it
was replied, "that not a sufficient dependence could be
placed on arrangements taken with us;" and an act of one
of the states, by which a discrimination of duties was made
between natives and foreigners, became the subject of a
letter from the premier, which, after reproaching the
American minister with a disregard of reciprocity in our
navigation laws and commercial regulations, closed with a
threat, " that the king will be under the necessity, contrary
to his wishes, to fall upon such means as will tend to put
matters upon a perfect equality. "*
These complaints were referred to the secretary of fo-
reign affairs, whose report admitted that the French mer-
chants enjoyed fewer privileges than the merchants of the
United States did in France, and that the act of Massachu-
setts " had deviated both from the letter and spirit of the
treaty. "f While the impotence of the confederation thus
subjected it to the just reproach of a breach of faith to-
wards their ally, it also gave rise to reclamations for indi-
vidual claims, the justice whereof could not be denied, and
which there were no means to discharge. The disappoint-
* 2 D. c. 488.
t 1 D. C. 243.
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? HAMILTON.
309
ments that followed produced great irritation among the
French residents in the United States, which extended to
her legation, and drew from them remonstrances, wherein
the respect due to an independent government was often
forgotten.
In vain did congress renew their assurances of eventual
payment, founded on the good faith of the states. Dis-
criminations in the provision for the interest on their
debts, from which provision foreigners were expressly ex-
cluded by some of the states, were pointed out, and the
very ground on which the delay of justice was excused,
the inability to compel the collection of taxes, gave rise to
the taunting inquiry, "Is there one, or are there eleven
republics V
It being a leading maxim in Jefferson's politics " to mul-
tiply the points of contact and connection" with France,
it will be seen, that he used every means to promote inter-
course with a people whose habits, manners, tastes, and
morals he admired.
The insufficient provision for the interest and instal-
ments then due of the debt to France, led to a proposition
to purchase it. The terms of this proposition are found in
the secret journal of congress of the second of October,
seventeen hundred and eighty-seven, giving an extract of
a letter from Jefferson to the secretary of foreign affairs:--
"That a proposition has been made to Monsieur de Ca-
lonne, minister of the finances of France, by a company
of Dutch merchants, to purchase the debt due from the
United States to the crown of France; giving for the said
debt, amounting to twenty-four millions of livres, the sum
of twenty millions of livres. That information of this
proposition has been given to him by the agent of the
said company, with the view of ascertaining whether the
proposed negotiation would be agreeable to congress.
That the said minister suggests, 'that if there is a danger
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of the public payments not being punctual, whether it might
not be better that the discontents which would then arise,
should be transferred from a court of whose good will we
have so much need, to the breasts of a private company. '
That the credit of the United States is sound in Holland;
and that it would probably not be difficult to borrow in
that country the whole sum of money due to the court of
France, and to discharge that debt without any deduc-
tion; thereby doing what would be grateful to the court,
and establishing with them a confidence in our honour. "*
This subject was resumed in a letter from Jefferson to
Jay of the twelfth of November following-f He wrote:
"In a letter which I had the honour of writing you on the
twenty-sixth December, I informed you that a Dutch com-
pany were making propositions to the minister of France
here, to purchase at a discount the debt due from the Uni-
ted States to this country. I have lately procured a copy
of their memoir, which I now enclose. Should congress
think this subject worthy their attention, they have no
time to lose, as the necessities of the minister, which alone
have made him to listen to this proposition, may force him
to a speedy conclusion. "
The former of these letters was referred to the board
of Treasury, who on the second of October of the follow-
ing year made a report; which, after reciting the previous
extracts of the letter of Jefferson, contains comments full
of meaning:--
"That at the time the debt due from the United States
to the crown of France was contracted, it could not have
been foreseen that the different members of the union
would have hesitated to make effectual provision for the
discharge of the same, since it had been contracted for
the security of the lives, liberties, and property of their
* 4 S. J. 386.
t 3 D. C. 175.
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? HAMILTON.
311
several citizens, who had solemnly pledged themselves for
its redemption; and that, therefore, the honour of the
United States cannot be impeached, for having authorizea
their minister at the court of France to enter into a formal
convention, acknowledging the amount of the said debt,
and stipulating for the reimbursement of the principal and
interest due thereon.
"That should the United States at this period give any
sanction to the transfer of this debt, or attempt to make a
loan in Holland for the discharge of the same, the persons
interested in the transfer, or in the loan, would have rea-
son to presume that the United States in congress would
make effectual provision for the punctual payment of the
principal and interest.
"That the prospect of such provision being made within
a short period, is by no means flattering; and though the
credit of the United States is still sound in Holland, from
the exertions which have been made to discharge the in-
terest due to the subscribers to the loans in that country,
yet, in the opinion of this board, it would be unjust as well
as impolitic, to give any public sanction to the proposed
negotiation. Unjust, because the nation would contract
an engagement without any well-grounded expectation of
discharging it with proper punctuality. Impolitic, because
a failure in the payment of interest accruing from this ne-
gotiation (which would inevitably happen) would justly
blast all hopes of credit with the citizens of the United
Netherlands, when the exigencies of the union might ren-
der new loans indispensably necessary.
"The board beg leave further to observe, that although a
grateful sense of the services rendered by the court of
France, would undoubtedly induce the United States in
congress to make every possible exertion for the reim-
bursement of the moneys advanced by his most christian
majesty, yet, that they cannot presume that it would tend
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<<
to establish in the mind of the French court an idea of
the national honour of this country, to involve individuals
in a heavy loan, at a time when congress were fully sensi-
ble that their resources were altogether inadequate to dis-
charge even the interest of the- same,* much less the instal-
ments of the principal, which would from time to time be-
come due. How far the idea of transferring the discontents
which may prevail in the French court, for the want of the
punctual payment of interest, to the breast of the private
citizens of Holland, would be consistent with sound policy,
the board forbear to enlarge on.
"It may be proper, however, to observe, that the public
integrity of a nation is the best shield of defence against
any calamities to which, in the course of human events, she
may find herself exposed.
"This principle, so far as it respects the conduct of the
United States in contracting the loans with France, cannot
be called in question. The reverse would be the case,
should the sanction of the United States be given either
to the transfer of the French debt, or to the negotiation of
a loan in Holland for the purpose of discharging it.
"If it be further considered, that the consequences of a
failure in the punctual payment of interest on the moneys
borrowed by the United States, can by no means be so
distressing to a nation, (and one powerful in resources,) as
it would be to individuals, whose dependence for support
is frequently on the interest of the moneys loaned, the
board presume that the proposed negotiation cannot be
considered at the present juncture, in any point of view,
either as eligible or proper. Under these circumstances,
* Jefferson wrote to Carmichael at Madrid, June 14, 1787 :--" New-York
still refuses to pass the impost in any form, and were she to pass it, Pennsyl-
vania will not uncouple it from the supplementary funds. These two states
and Virginia, are the only ones, my letters say, which have paid any thing
into the continental trcasary for a twelvemonth past. "
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? HAMILTON. 313
they submit it as their opinion, " that it would be proper
without delay to instruct the minister of the United States
at the court of France,* not to give any sanction to any
negotiation which may be proposed for transferring the
debt due from the United States, to any state, or compa-
ny of individuals, who may be disposed to purchase the
same. "
So jealous were congress of the injury which this pro-
position might inflict on the national character, that on the
day on which this report is dated, they instantly passed
an act instructing Jefferson not to promote any negotia-
tion for transferring the debt due to France from the
United States. f
Thus the national honour was saved, but the lure had
succeeded. In prosecution of the project, a letter was ad-
dressed by Jefferson to Dumas,J to ascertain its practica-
bility; whose reply evinced a preference of a purchase
for a sum less than its face, to a loan for the whole amount,
and urged prompt action, stating that the sacrifice on
the part of France, would be very small. An arret was
accordingly framed and submitted to Calonne. That min-
ister, grasping at such a prospect of relief from his finan-
cial difficulties, soon after this purchase was suggested,
addressed a letter to Jefferson, giving the assurance that
the monopolies on particular articles would not be renew-
ed, and that the duties on most of the imports, the growth
of the United States, in French or American vessels, were
"suppressed. "? The execution of this arrangement was,
? 3D. C. 183. t3D. C. 289.
X Dumas had a pension from France, revertible to his daughter.
? 3 Dip. Cor. 163. --Oct. 22,1786. --Tins letter also states, that as Virginia
had ordered arms for her militia from France, the duties and prohibition of
them should be abolished. Similar supplies had been furnished by France
to her during the war, which gave rise to questions in the settlement of the
accounts. A more serious difficulty grew out of an act of that state, passed
pending Jefferson's negotiation about the debt, giving a preference to French
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? 314 THE LIFE OF
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