being finally settled. I drew my conclusion from his letter to me of
the 22d of July last read in Congress. I find the accounts are not
finally closed, though Doctor Franklin and Mr Adams have ordered him
the payment. Mr Williams informs me he has written to Congress and
sent his accounts; the accounts themselves will show that I have not,
nor ever had, any private or personal interest in his transactions; at
the same time I beg leave to interest myself in what affects this
gentleman, because I think I know him to have been a most faithful and
useful servant of the public, and every way deserving of the character
given him by Dr Franklin and Mr Adams; and as Dr Franklin, from being
his uncle, feels a delicacy in writing so fully about him, I therefore
pray that this gentleman's accounts may be put into a train for being
closed.
I recollect that Mr Lee has mentioned Count Lauragais in his
correspondence with Mons. Beaumarchais, and am informed that this
gentleman has in his letters been referred to. Count Lauragais is a
nobleman, who was born to an immense fortune, the chief of which he
has long since dissipated in a wild and I may say in such an eccentric
course of life, as hardly has a parallel in France. He has set up at
times for a philosopher, a wit, a poet; then as suddenly flew off, and
engaged in building, planting, or politics; he was one month for
engaging in trade, the next a country gentleman on his farm, the third
blazing in the beau monde at Paris; and France being insufficient to
afford a variety of scenes suited to equal the restlessness of his
genius, he has constantly been shifting them, from Paris to London and
from London to Paris. In London he set up for a patriot, and engaged
seriously in the disputes and parties of the day, and what was very
diverting, sat down for a few weeks to study the laws of England in
order to confute Blackstone. His rank, to which his birth entitles
him, gives him admittance to court, and the extravagancy of his wit
and humor serves to divert and please men in high office, and he
consequently at times fancies himself in their secrets. This gentleman
knew Mr Lee in London before I arrived in France, and was afterwards
often with him at Paris. His character was given me soon after my
arrival, and I was put on my guard and warned by the minister, not
that he supposed him to have designs unfriendly, either to France or
America, but on account of his imprudence, and of his being frequently
in London, and with those in the opposition in England, of whom the
Court of France were more jealous, and against whom they were equally
on their guard, as with the British ministry themselves. As this
nobleman's name may be made use of, I cannot dispense with touching
lightly on the outlines of a character extremely well known in France
and England, and to which some gentlemen in America are no strangers.
I have mentioned the first and principal contract having been made for
clothing, with Mr Holker, now agent for France in America. This
gentleman was then one of the inspectors general of the manufactures
of France, and knowing perfectly well the price and quality of cloth
in every part of the kingdom, he undertook, at the request of our
mutual friend, Mons. Chaumont, to put us in the way of being supplied
at the cheapest rates, and, by joining himself in the written
contract, induced his friends, Messrs Sabbatier and Desprez, to
engage, which they did; they purchased the cloth at the manufactories,
at the first cost, procured it to be made up at the cheapest rate, and
the clothes to be transported to Nantes, charging only the prime cost
on every thing, and two per cent commissions for their trouble. Mr
Holker, after having engaged these men, whose house is a capital one
in Paris, and who, from their having for some time supplied a great
part of the clothes to the armies of France, were well acquainted with
business of that kind, took no farther part in the affair, but that of
examining the work and accounts, to see that every thing was performed
in the best and cheapest manner. In this I assisted him. I went with
him to the workmen, and examined the cloth, the fashion and the
economy practised in the work, from which I will venture to assert,
that clothes of equal goodness could not be made cheaper, if so cheap,
by any other method in France.
Mr Holker, and the other gentlemen, as I have already observed, saw Mr
Arthur Lee several times on the subject, until they became so
disgusted with a man, who found fault with every thing, without
stepping out of his door to examine any thing, that they declined
having any thing further to say to him. When their accounts were ready
to be settled, I examined them, struck the balance, and Mr Arthur Lee
joined with Dr Franklin and myself in signing draughts on Mr Grand
for the money. The bills were drawn in favor of Messrs Sabbatier and
Desprez solely, Mr Holker taking no share in the commissions, but
generously gave in the time he had spent in the affair, though it had
been considerable. This gentleman is now in Philadelphia, and if
necessary may be applied to respecting what I have said on this
subject; his character, as well as that of his worthy father is well
known in France, where they are jointly inspectors of the manufactures
of that kingdom, and on every occasion they exerted themselves to
serve this country, a testimony due to them from me when I am called
on to mention them publicly. The instances they gave me personally of
the most disinterested friendship and attachment I shall never forget.
I can but return to Mr Williams. This gentleman, after stating all his
accounts in the fairest and most explicit order, attended near ten
weeks at Passy for a settlement. Doctor Franklin and Mr Adams, as has
before been related, so far approved of them as to order his balance,
or nearly the whole of it, to be paid him, and gave him a letter
certifying him of their full persuasion of his ability and integrity,
and that he had done good services, yet such was the disposition of Mr
Lee towards him, that he could by no means get them past. Impatient
and wearied out with the captious insulting manner in which he was
treated by Mr Lee, and which nothing but his official character
protected him in, Mr Williams engaged a gentleman from Boston, Mr
Cutler, to copy off all his accounts, and compare them with the
original vouchers, and to make a voyage to America, to lay them before
Congress. This gentleman arrived a few days since, and having made the
voyage and journey on this purpose only, I take the liberty to entreat
Congress in behalf of my absent friend and their faithful servant,
that those accounts may be examined, that Mr Cutler may be heard if
necessary to explain them, and Mr Williams relieved from the
embarrassments of Mr Lee, whose disposition does not appear to be
mended since I left Paris, but, if possible, greatly increased for
dispute, and for the most vexatious altercation.
Could I take any pleasure on so disagreeable a subject, and one which
throws the affairs as well as reputation of these States into
confusion and disgrace, it would be to find that the universal
testimony of all who know the situation of our affairs in France,
confirms what I have in duty and justice to these States been obliged
to lay before Congress. Mr Lee's nephew, a son of the honorable
Richard Henry Lee, is in the house of Mons. Schweighauser, at Nantes,
as a clerk, or as a partner, I am informed the latter. Commercial
affairs, and the disposition of prizes, are put into the care of this
house, while a near connexion of M. Schweighauser, at Guernsey, or
Jersey, is employing himself in sending out cruisers on our commerce.
I know nothing of M. Schweighauser, except by reports; those have been
in his favor as a good merchant, but this circumstance, added to some
others, which Mr Cutler informs me of, has given cause for the
greatest uneasiness and distrust, which, added to the difficulties met
with at Paris from Mr Arthur Lee, prevents any thing being done to
effect, if really any thing at all towards sending out supplies to
these States.
SILAS DEANE.
* * * * *
TO THE PRESIDENT OF CONGRESS.
Philadelphia, 12th October, 1778.
In a conference had with Mons. Gerard, in the month of January last,
at Versailles, he observed that the thirteenth article[15] in the
treaty proposed by Congress, which exempted the molasses purchased by
the inhabitants of the United States in any of the islands belonging
to, and subject to, his Most Christian Majesty, from any duties
whatever, was an unequal article, as he termed it, that without some
concession of equal importance on the part of the United States, it
could not be agreed to, as it would carry the appearance of
inequality, and as if Congress were taking the advantage and dictating
the terms in their own favor, that therefore it was expected, either
wholly to omit the article, or place an equivalent over against it on
our part.
On my return to Paris, I laid M. Gerard's proposals before my
colleagues, who agreed generally to the justice and propriety of them,
but we found it difficult to place any article or articles over
against that of molasses, which would be of equal consequence, and in
which the States of America were at the same time equally interested.
After long consideration had on the subject, Dr Franklin proposed the
article nearly as it now stands; Mr Lee objected to it, as being too
extensive, and more than equivalent for that of molasses only; to
which I answered, that though the concession might appear great, it
was in reality nothing more than giving up what we never could make
use of but to our own prejudice, for nothing was more evident than the
bad policy of laying duties on our own exports; that molasses, though
apparently but an article of small value, was the basis on which a
very great part of the American commerce rested; that the manufacture
of it into rum, was every year increasing, especially in the middle
and southern states, where it had been more lately introduced.
Doctor Franklin agreed with me, and argued on much the same ground,
but neither of us insisted on the article at the time, but that the
proposition should be made for the consideration of Mons. Gerard,
reserving to ourselves the power of agreeing to it or not afterwards.
A few evenings after, and nearly as I can remember about five or six
days before the actual signing of the treaty, we met Mons. Gerard at
my house in Paris; he brought the proposed treaty with him, in which
he had inserted the 11th and 12th articles as they now stand. The
treaty was read, considered, and agreed to, article by article, except
the 11th and 12th, respecting which M. Gerard observed at first, that
he considered them as they then stood reciprocal and equal, but that
he left it entirely with us to retain them both, or to reject them
both, it being indifferent with his Majesty, but that one could not be
retained without the other. On our having agreed to all the other
articles, we told him we would confer together on the 11th and 12th,
and write to him what our determination should be. As soon as he was
gone, the subject was taken up; the arguments before used were again
considered, and finally we unanimously agreed to retain both the
articles; on which I desired Mr Lee to write a letter to Mons. Gerard,
informing him of it, and that I would send it out to Versailles the
next morning, from Passy, that there might be no more delay in
transcribing and executing the treaties. Mr Lee accordingly wrote, and
Dr Franklin, he, and myself signed the letter, which I sent the next
morning.[16]
A day or two after this, Mr A. Lee wrote a letter to Dr Franklin and
me, in which he expressed great uneasiness about the 11th and 12th
articles, and a desire to have them left out, on which we advised Mr
Lee to go himself to Versailles on the subject, which he accordingly
did, and we wrote to M. Gerard, by him, that we were content to have
the two articles left out, if agreeable to his Majesty.[17] As we had
just before unanimously agreed and written to have them retained, we
could not, with any consistency, make a point of their being expunged.
Mr Lee discoursed on the subject with M. Gerald, who satisfied him as
he thought at the time, and as we all then thought, of the impropriety
of making any alteration in the treaty, after it had been so maturely
considered; had been fully agreed upon by us all; had been approved
of in form by his Majesty, and ordered to be transcribed and signed.
Neither Mr William Lee nor Mr Izard ever spoke one word to me on the
subject, and I did not think myself authorised or at liberty to
consult them, or any other person on the subject, but my colleagues.
SILAS DEANE.
FOOTNOTES:
[15] "ARTICLE XIII. It is agreed by and between the said parties, that
no duties whatever shall ever hereafter be imposed on the exportation
of molasses from any of the islands and dominions of the Most
Christian King, in the West Indies, to any of these United States."
[16] The articles in question are as follows;
"ARTICLE XI. It is agreed and concluded, that there shall never be any
duty imposed on the exportation of molasses, that may be taken by the
subjects of any of the United States from the Islands of America,
which belong, or may hereafter appertain, to his Most Christian
Majesty.
"ARTICLE XII. In compensation of the exemption stipulated in the
preceding article, it is agreed and concluded, that there shall never
be any duties imposed on the exportation of any kind of merchandize,
which the subjects of his Most Christian Majesty may take from the
countries and possessions present or future of any of the thirteen
United States, for the use of the islands which shall furnish
molasses."
The treaty may be seen entire in the _Secret Journals of Congress_,
Vol. II. p. 59.
[17] See these letters in Arthur Lee's Correspondence, under the date
of January 30th, 1778.
* * * * *
TO THE PRESIDENT OF CONGRESS.
Philadelphia, 1st November, 1778.
Sir,
I think it unnecessary to make an apology for sending you the enclosed
estimates and reflections made on two of the most important and
interesting subjects, and for desiring the same may be communicated to
Congress. Should that honorable body approve of any or all of them, I
shall be very happy, and if they should not they will excuse me for
having given them this trouble, when they reflect, that the desire of
throwing some light on these subjects has been my sole motive.
The providing for the redemption of our money, and the establishment
of a marine, are objects, which in my view, far exceed in the
magnitude and extent of their importance, any that are at present
under public consideration; they greatly depend on each other, and
permit me to say, all our future operations in a great degree depend
on them. We cannot pay the interest of any considerable loan without
commerce, which cannot be revived effectually without a marine force
of our own, which may I am confident be formed on the enclosed plan,
and be ready in a short space of time to act with vigor. Great Britain
has long had the empire of the ocean, and in consequence the whole
world has been her tributary; her own bad policy and the present war
will deprive her of that empire; at this important crisis it depends
on the measures taken by the United States, whether they shall succeed
Great Britain or not in this extensive dominion. Reason, observation,
and experience authorise me to say, there is not in the world any
power so capable of it, and as the United States can never aim at
foreign conquests, but simply to guard their own coasts, and to
protect the commerce of their subjects, their superiority at sea can
never give just cause of jealousy or offence to any other nation. I am
confident that a fleet of forty sail, to consist of twenty such large
ships as I have described, and twenty frigates, will be more than
equal to this purpose, and such a fleet may be got to sea in the
course of the coming year, if the materials wanted from Europe can be
procured, which, if immediately applied for, I have not the least
doubt of.
I have the honor to remain, &c.
SILAS DEANE.
_P. S._ I am still without the honor of any answer to my letter of the
7th ult.
November 13th.
After writing the above, my apprehension, lest I should be thought any
way out of the usual course in communicating my sentiments to
Congress, made me omit sending it to you with the enclosed, but the
alarming intelligence, which I received but a day or two since, of the
sentiments of my countrymen in different parts on the present
situation of the credit of our money, the state of our finances and
resources, and of the temper and disposition prevailing in
consequence, has made me waive every personal consideration, and
communicate this with the enclosed to Congress, and I shall count it
one of the happiest occurrences of my life, if anything in my power
will help to prevent that total loss of public as well as private
credit, which I am sorry to find begins to be almost universally
apprehended, and I fear appearances at this time are in support of
such apprehensions, which though at bottom they may be ill founded,
yet, if once generally prevailing, will produce consequences easily
foreseen. I beg leave to refer to Colonel Duer for the substance of
the intelligence I refer to, having communicated the letters I have
received to him, for as they contain many things merely personal, I
could not lay them at large before Congress.
S. D.
* * * * *
PLAN _for sinking fiftythree millions of dollars of the Continental
Currency, and to establish a Bank of one million, and a half sterling,
or $6,666,666-2/3 in Europe for the use of the States of America, at
the expense of forty millions of dollars in specie only, or of Bills
upon Europe equivalent_.
1st. Let a loan be obtained of twentyfive millions of dollars on
account of the United States; the interest and necessary charges will
probably amount to, and will not exceed, six per cent per annum.
2dly. Let a fund be established of two millions and a half annually,
clear of all charges of collecting and remittances, out of which let
the interest of the loan be paid, and the surplus unalienably
appropriated as a sinking fund to discharge the principal; the annual
interest of twentyfive million dollars; at six per cent will be
1,500,000 dollars, the sinking fund one million.
3dly. The calculation which follows demonstrates, that this fund of
two millions and a half of dollars will, in sixteen years, pay off the
principal and interest of the twentyfive millions borrowed, and leave
a surplus of $673,103 in the hands of the States, which may be
supposed equivalent to the charge of managing the money, and paying
the loan in Europe.
4thly. A fund of two millions and a half for sixteen years amounts to
forty millions, but twentyfive millions at six per cent simple
interest will in that time amount to fortynine millions, supposing the
interest annually paid; hence it is evident, that a sinking fund of
one million operating on such a loan of twentyfive millions, will make
a saving of nine millions of dollars to the States out of what will
otherwise be paid on the same capital, on the plan of borrowing
practised in our, and indeed in most other loan offices; or in other
words would reduce the interest from six to little more than three and
a half per cent, which is demonstrated in the following calculations.
5thly. Twentyfive millions of dollars may be computed in value equal
to £5,625,000 sterling. Of this, let one million and a half, or
£1,620,000 sterling be applied to the payment of debts contracted in
Europe, contracted by the commissioners, for the discharge of which no
particular mode has been stipulated and agreed upon, and for the
establishing a bank or fund for other uses and benefit of the United
States.
6thly. As the sum of £125,000 sterling will be equal to the public
debts already contracted in Europe, except those to the
Farmers-General and the house of Rodrique Hortalez & Co. there will
remain, agreeable to the plan, one million and a half sterling, or
$6,666,666-2/3 in the Congress' Bank in Europe, and four millions
sterling, or $17,777,777-2/3, for the purpose of sinking the sum of
fiftythree millions proposed.
7thly. The present rate of exchange is from five to six for one; it
must happen that as bills are brought to market to a greater amount
they will fall, but if it be considered that the ordinary demand of
these States on Europe for goods exceeded four millions sterling
annually in times of peace, that the demand at present and for two or
three years to come, even if peace should take place immediately, must
exceed the former usual demand, that though the cancelling and sinking
of fiftythree millions of dollars will tend to appreciate the
remainder in circulation, yet as there will still remain in
circulation a greater nominal sum than the commerce of these States
call for, the appreciation will not be repaid; and if it be further
considered, that the merchants in the United States are at present
destitute of their usual means of remittance, having neither ships,
specie, nor produce on hand,--I say under these considerations it is
improbable, if not impossible, consistent with the interest of
individuals, that bills drawn on Europe for the sum of four millions
sterling should be under three for one on an average.
8thly. Four millions sterling, or $17,777,777-2/3, at three for one,
will amount to $53,333,333 here. Allowing $333,333 for the charge of
drawing the bills, for other expenses and deficiencies unforeseen, and
there will be, agreeable to the proposals in the plan, fiftythree
millions of dollars of the Continental currency paid off by the sales
of those bills.
The benefits resulting from this plan, if realized, are numerous,
indisputable, and obvious. As the sum proposed to be drawn for, does
not exceed the ordinary amount of importation before the war, it
cannot be presumed that this plan can produce any ill effects on
commerce, especially if the Congress should think it wise and prudent
to drop the merchants themselves, and depend on individuals for their
supplies. The capital difficulty is to obtain the loan. On this, as
well as on the preceding plan, I will make a few observations after
the following calculations already referred to.
FIRST CALCULATION.
| Produce of the | Total of the |
Years.| sinking fund at | Debts paid at | EXPLANATION.
| the end of | the end of |
| every year. | every year. |
------+-----------------+----------------+------------------------
1 | 1,000,000 | 1,000,000 | The first column marks
| 60,000 | | the years; the second
2 | 1,060,000 | 2,060,000 | the produce or amount
| 63,600 | | of the sinking fund at
3 | 1,123,600 | 3,103,600 | the end of each year,
| 67,416 | | the third shows how
4 | 1,191,016 | 4,374,616 | large a part of the
| 71,461 | | capital has been paid
5 | 1,262,477 | 5,637,093 | off at the end of each
| 75,788 | | year. The sum in the
6 | 1,338,265 | 6,975,358 | second column is found
| 80,296 | | by adding to it
7 | 1,418,561 | 8,393,919 | annually the interest
| 85,113 | | of that part of the
8 | 1,503,674 | 9,897,593 | capital paid off the
| 90,220 | | preceding year, and the
9 | 1,593,894 | 11,491,487 | sum in the third by
| 95,633 | | adding yearly the
10 | 1,689,527 | 13,181,014 | payments.
| 101,372 | |
11 | 1,790,899 | 14,971,913 |
| 107,454 | |
12 | 1,898,353 | 16,870,266 |
| 113,901 | |
13 | 2,012,254 | 18,882,520 |
| 120,735 | |
14 | 2,132,989 | 21,015,509 |
| 127,979 | |
15 | 2,260,968 | 23,276,477 |
| 135,658 | |
16 | 2,396,626 | 25,673,103 |
| | |
| Principal Loan | 25,000,000 |
| Surplus | 673,103 |
SECOND CALCULATION.
$2,500,000 annually collected and paid
for sixteen years, amount to (the whole sum
paid) 40,000,000
But the surplus of $673,103 deducted,
leaves $39,326,897, the net sum applied
to sink a principal of $25,000,000, and the
interest for sixteen years, 673,103
----------
39,326,897
The annual interest of $25,000,000 at six
per cent is 1,500,000, which at simple interest
in sixteen years is 24,000,000, 24,000,000
Add the principal, 25,000,000
----------
49,000,000
Bring down 39,326,897
----------
Surplus, 9,673,103
By these calculations it is clearly demonstrated,