3dly. The punctuality in the payment of interest is essential to public credit.
4thly. As Congress forego their right to insist on the princ.i.p.al, it is but just that they should have every possible security for the interest.
5thly. As the people are in either case to pay the supposed tax at certain periods it must be a matter of indifference to what particular man the payment is made.
6thly. The objection raised in favor of elected tax gatherers, viz.
that they consider the circ.u.mstances of the people, which is saying in other words, that they are guilty of favor and partiality, is the strongest reason why the collectors should be appointed by, and amenable to, Congress.
7thly. It is a kind of absurdity in itself, that Congress should have a right to the tax, and yet no right to send their servants to receive it.
I pray leave also to observe, that the revenues must be co-existent with the debt. No man in his senses will lend on any other terms. If the revenue be only for a fixed period of time, no more can be borrowed on it than the price of an annuity for such a time. And it has already been observed, that money must be _borrowed_ to _pay_ the public creditors, because they have a just right to their _money_.
Another observation on this subject I must take the liberty to impress. The more clear, certain, permanent, and increasing the funds are, the lower will be the interest at which money can be borrowed. If the funds be very good, money may be borrowed at four per cent, perhaps at three per cent. If they are not good it will not be procured for less than six, seven, or eight per cent, and perhaps not at all. Proper reflections on this subject will naturally suggest themselves, and it will not be forgotten, that whether the debt be less or greater, and whether the interest be higher or lower the _people must pay all_.
With respect to the impost I conceive it to be justly exceptionable, because that an estimation ad valorem is arbitrary, and the law ought in all cases to be clear and explicit. The impost on prizes need not, I should suppose, be asked for, because Congress may take measures for the purpose themselves whenever the occasion requires. I conceive also, that a tax might be laid on exports which, without being burdensome, would still be productive. Enclosed is a list of rates, which I take the liberty to submit. I cannot go into a written detail of the reasons for them, because my time will not permit.
I am told that the princ.i.p.al objection to a land tax is the inequality. To obviate this objection (although I cannot accede to the force of it) perhaps a reduction of the sum from one dollar to a quarter of a dollar per hundred acres might be expedient; and to supply the deficiency, a tax on houses might be adopted, according to the enclosed rate, which I also beg leave to submit.
I must take the liberty to declare my most serious apprehensions from the existence of unsettled accounts among the States. Everything which tends to create or continue them is fraught with ruinous consequences.
Keeping accounts of moneys paid by taxes of the States, and liquidating those accounts by after settlements, will, I fear, prove the source of much dissension. It will operate as heretofore in preventing the States from paying anything. I would pray therefore to submit to Congress the following mode of terminating all present accounts, viz. that the whole sum paid or expended by each State, for the public service from the commencement of the war, should be placed to the credit of the particular State, and each draw interest on such sum. By these means the whole account would be equitably settled in the first instance. The States which are indebted on their own private account, would be able to wipe off such debts by an a.s.signment of national stock. And on the first requisitions made by Congress for current expenditures, each might make payment either in part, or perhaps in the whole, by a discharge of so much of the debt. Thus a degree of simplicity would be introduced into our affairs, and we might avoid the horrors of intestine convulsions.
I have the honor to be, &c.
ROBERT MORRIS.
GEORGE WASHINGTON TO ROBERT MORRIS.
Head Quarters, March 8th, 1783.
Sir,
Very painful sensations are excited in my mind by your letter of the 27th of February. It is impossible for me to express to you the regret with which I received the information it contains.
I have often reflected with much solicitude upon the disagreeableness of your situation, and the negligence of the several States in not enabling you to do that justice to the public creditors, which their demands require. I wish the step you have taken may sound the claim to their inmost souls, and rouse them to a just sense of their own interest, honor and credit. But I must confess to you that I have my fears, for as danger becomes further removed from them, their feelings seem to be more callous to those n.o.ble sentiments, with which I could wish to see them inspired. Mutual jealousies, local prejudices and misapprehensions, have taken such deep root as will not easily be removed.
Notwithstanding the embarra.s.sments which you have experienced, I was in hopes that you would have continued your efforts to the close of the war at least; but if your resolutions are absolutely fixed, I a.s.sure you I consider the event as one of the most unfortunate that could have fallen upon the States, and most sincerely deprecate the sad consequences which I fear will follow. The army, I am sure, at the same time that they entertain the highest sense of your exertions, will lament the step you are obliged to take as a most unfortunate circ.u.mstance to them.
I am, &c.
GEORGE WASHINGTON.
TO THE PRESIDENT OF CONGRESS.[13]
Office of Finance, March 10th, 1783.
Sir,
In consequence of the order of Congress of the 18th of last month, I do myself the honor to enclose an estimate of the princ.i.p.al of the public debt to the first day of January, 1783, which has been transmitted to me by the Register of the Treasury. This amounts to _thirtyfive millions three hundred and twentyseven thousand seven hundred and sixtynine dollars fiftythree and one eighth ninetieths_, exclusive of what he calls the _unliquidated debt_, being the moneys due to the several States and to individuals in the several States. I beg leave also to mention other debts which have not been taken into the Register"s contemplation, namely, the _old continental bills_ and _arrearages of half pay_. Congress will easily see that it is not in the power of their servants to state the public debts with any tolerable precision.
I have the honor to be, &c.
ROBERT MORRIS.
[13] _March 12th._ This morning arrived the ship Washington, Captain Barney, with despatches from our Ministers in Paris, and with six hundred thousand livres in cash, on account of the United States, in consequence of my order in October last;--and this day also appeared a virulent attack on my public and private character, signed _Lucius_, in the Freeman"s Journal, replete with falsehoods.--_Diary._
TO MAJOR GENERAL GREENE.
Office of Finance, March 14th, 1783.
Sir,
I received the other day your letter of the 2d of February last, and am very much obliged both by the pains you have taken, and the sentiments you have expressed in favor of a department, which I shall shortly be obliged to abandon. You will before this reaches you have seen in the newspapers my letters of resignation. I shall not, therefore, go into a detail of the reasons for taking that step, which was as painful to me as you can easily conceive. But I had no alternative. I saw clearly that while it was a.s.serted on all hands, our debts ought to be paid, no efficient measures would be adopted for the purpose; no good plan agreed on. I felt the consequences of my resignation on the public credit; I felt the probable derangement of our affairs; I felt the difficulties my successor would have to encounter, but still I felt that above all things it was a duty to be honest. This first and highest principle has been obeyed. I do not hold myself answerable for consequences. Those are to be attributed to the opposers of just measures, let their rank and station be what they may. I expect much obloquy for my conduct, because this is what I knew to be the reward for any conduct whatever which is right. To slander I am indifferent, and still more indifferent about the attempts to question the services I have rendered, but I feel most sensibly for your situation, and for that of every other officer.
The Congress have now, and have long since had under their consideration, a due provision for the public debts; when they will conclude it, and what it will be, G.o.d only knows. If it is such as in my opinion will do justice, I shall stay somewhat longer in office to know the decisions of the States, and if their proceedings are what on such an occasion they ought to be, I shall spare no labor and regret no time in completing the business, so that my successor may receive it from my hands as clear and simple, as it was confused and embarra.s.sed when it was undertaken. But if these things do not happen, you and every other good man will, I hope, acquit me for leaving a post, in which I am totally unsupported, and where I must be daily the witness to scenes of poignant anguish, and deep injustice without the possibility of administering either relief or palliation. While I do continue in office, rely on every support in my power, and always, whether a public or a private man, believe in my esteem and affection.
I am, very respectfully, &c.
ROBERT MORRIS.
TO THE PRESIDENT OF CONGRESS.
Office of Finance, March 17th, 1783.
Sir,
I do myself the honor to enclose the copy of a letter of the 14th of December last from Dr Franklin, and the translation of a letter of the 15th instant, from the Chevalier de la Luzerne. These, together with the letter of the 23d of December from Dr Franklin, of which I have already submitted a copy, will I trust claim the attention of the United States.
M. de la Luzerne did me the honor to make verbal communication of the Count de Vergennes" letters, from which as well as from those of Dr Franklin and from other circ.u.mstances, I consider it as certain that we are to expect no further pecuniary aid from Europe. So late as on the 9th of December last, the loan in Holland had not amounted to eighteen hundred thousand florins, and after the deduction of the charges on it, there were not above seventeen hundred thousand at my disposal. From the month of June to the 9th of December this loan had not increased half a million of florins, so that the most sanguine expectation will not carry it beyond two millions out of the five for which it was opened.
Congress will recollect, that on the 14th of September last they ordered a loan of four millions of dollars in Europe, for the service of 1783, in addition to this loan, which Mr Adams had opened in Holland. They will also recollect, that I had antic.i.p.ated upon those resources about three and a half millions of livres during the year 1782. And that this antic.i.p.ation was over and above the sum of a million and a half of florins, which we then knew to have been borrowed in Holland. Allowing, therefore, for the supposed increase of half a million of florins or a million of livres, there will still remain of antic.i.p.ation two and a half millions of livres; so that of the sum lent for this year by his Most Christian Majesty there will remain but three millions and a half of livres. According to the common course of exchange, this sum cannot be expected to yield more than six hundred thousand dollars. Six hundred thousand dollars, therefore, with what the States will yield in taxes, form the whole of our expectations for the current year. From this is to be deducted one month"s pay already promised to the army, amounting by estimate to upwards of two hundred and fifty thousand dollars.
To judge of our prospects for what remains, Congress will be pleased to observe, that the subsistence of our officers is nearly twenty thousand dollars, that the rations issued in New York and New Jersey are about fifty thousand dollars, and that the rations of the southern army will probably amount to upwards of twelve thousand dollars. If to this be added the various detached corps, it will be found, that the articles of rations and subsistence, exclusive of the prisoners, will form an amount of about ninety thousand dollars a month. My antic.i.p.ations on the taxes are so well known, that it is not necessary to mention them any more than the other objects of forage, &c. which are indispensable. I have gone into these few details merely to elucidate one position, viz. that _all the money now at our command, and which we may expect from the States for this two months to come, will not do more than satisfy the various engagements, which will by that time have fallen due_.
It is of importance that Congress should know their true situation, and therefore I could wish, that a committee were appointed to confer with the Minister of France. My reason for that wish is, that every member of Congress may have the same conviction, which I feel of one important fact. _That there is no hope of any further pecuniary aid from Europe._ The conduct of the French Court on the subject has been decisive. Some persons have indeed flattered themselves, that her positive declarations were merely calculated to restrain our rashness and moderate our excess, but these ideas can no longer have place in any sound and discerning mind. Her conduct has been consistent with her declarations, and if she had ever so much inclination to a.s.sist us with money _it is not in her power_.
But whatever may be the ability of nations or individuals, we can have no right to hope, much less to expect the aid of others, while we show so much unwillingness to help ourselves. It can no longer be a doubt to Congress, _that our public credit is gone_. It was very easy to foresee that this would be the case, and it was my particular duty to predict it. This has been done repeatedly. I claim no merit from the prediction, because a man must be naturally or wilfully blind who could not see, _that credit cannot long be supported without funds_.
From what has already been said, Congress will clearly perceive the necessity of further resources. What means they shall adopt, it is in their wisdom to consider. They cannot borrow, and the States will not pay. _The thing has happened which was expected._ I cannot presume to advise. Congress well knew that I never pretended to any extraordinary knowledge of finance, and that my deficiencies on this subject were a princ.i.p.al reason for declining the office. I have since had reason to be still more convinced of my incompetency, because the plans which I did suggest have not met with approbation. I hope, therefore, that some abler mind will point out the means to save our country from ruin.
I do a.s.sure you, Sir, that it is extremely painful to me to be obliged to address Congress on this subject. I wish most sincerely, that I could look at our future prospects with the same indifference, that others have brought themselves to regard them. Perhaps I am not sufficiently sanguine. It is common for age to listen more to the voice of experience than youth is inclined. The voice of experience foretold these evils long since. There was a time when we might have obviated them, but I fear that precious moment is pa.s.sed.
Before I conclude this letter, I must observe on the misconstructions, which men, totally ignorant of our affairs, have put on that conduct, which severe necessity compelled me to pursue. Such men, affecting an intimate knowledge of things, have charged the destruction of public credit to me, and interpreted the terms of my resignation into reflections upon Congress. I hope, Sir, that so long as I have the honor to serve the United States, I shall feel a proper contempt for all such insinuations. I shall confidently repose myself on the candor of Congress. It is for them to judge of my conduct on full and intimate knowledge. Writers for a newspaper may, indeed, through the medium of misrepresentation, pervert the public opinion, but the official conduct of your servants is not amenable to that tribunal. I hope, however, to be excused for observing, that on the day in which I was publicly charged with ruining your credit, those despatches arrived from Europe, which tell you it was already at an end. The circ.u.mstances which I alluded to in my letter of resignation, were not yet known in Europe. It was not yet known that Rhode Island had unanimously refused to pa.s.s the impost law, and that Virginia had repealed it. The very delays, which the measures of Congress had met with, were sufficient to sap the foundations of their credit. And we now know that they have had that effect. When those circ.u.mstances, therefore, shall be known, it must be overturned. I saw this clearly, and I knew that until some plain and rational system should be adopted and acceded to, the business of this office would be a business of expedient and chicane. I have neither the talents nor the disposition to engage in such business, and, therefore, I prayed to be dismissed.