7. That there be a meeting of the directors quarterly, for the purpose of regulating the affairs of the bank; any seven of the directors to make a board, and that the board have power to adjourn from time to time.
8. That the board of directors determine the manner of doing business, and the rules and forms to be pursued, appoint the various officers, which they may find necessary, and dispose of the money and credit of the bank for the interest and benefit of the proprietors, and make from time to time such dividends out of the profits as they may think proper.
9. That the board be empowered from time to time, to open new subscriptions, for the purpose of increasing the capital of the bank on such terms and conditions as they shall think proper.
10. That the board shall, at every quarterly meeting, choose two directors to inspect and control the business of the bank for the ensuing three months.
11. That the inspectors so chosen shall, on the evening of every day, Sundays excepted, deliver to the superintendent of the finances of America, a state of the cash account, and of the notes issued and received.
12. That the bank notes, payable on demand, shall by law be made receivable in the duties and taxes of every State in the union, and from the respective States, by the Treasury of the United States, as specie.
13. That the superintendent of the finances of America shall have a right at all times to examine into the affairs of the bank, and for that purpose shall have access to all the books and papers.
14. That any director or officer of the bank, who shall convert any of the property, monies, or credits thereof to his own use, or shall any other way be guilty of fraud or embezzlement, shall forfeit all his share or stock to the company.
15. That laws shall be pa.s.sed making it felony, without benefit of clergy, to commit such fraud or embezzlement.
16. That the subscribers shall be incorporated under the name of the President, Directors and Company of the Bank of North America.
17. That none of the directors shall be ent.i.tled to any pecuniary advantage for his attendance on the duties of his office of director, or as president, or inspector, unless an alteration in this respect shall hereafter be made by the consent of a majority of the stockholders at a general election.
18. That as soon as the subscription shall be filled, Mr George Clymer and Mr John Nixon shall publish a list of the names and sums respectively subscribed, with the places of abode of the subscribers, and appoint a day for the choice of directors, to whom, when chosen, they shall deliver over the money by them received.
_Observations on the above Plan._
ART. 1st. The objects and use of a bank are too obvious to need ill.u.s.tration. But it may not be amiss to take notice, that the first moment of its getting into action, the credit arising from its funds can be made use of by the government of the United States in antic.i.p.ation of taxes, in consequence of special agreements to be made between their superintendent of Finance and the directors for that purpose; and as the capital and credit of the bank increase, so may this mode of antic.i.p.ation be increased, to answer all the purposes of government. It is, however, evident at the first view, that four hundred thousand dollars are not sufficient for those purposes, nor those of private commerce, because no considerable circulation of paper can be founded on so narrow a basis; yet it is dangerous to attempt more. It is not possible to determine what is the highest sum, that could speedily be obtained by subscription. To ask more than could be obtained would have a fatal effect; to ask less is a partial evil. It is, however, an evil which admits of a remedy, as is provided in the plan.
ART. 2d. Before the corporation is formed, and much more so before the subscription is opened, by which the company is to be determined, no authority can be bestowed under the corporation. At the same time, it must be remembered, that in circ.u.mstances like ours, the loss of time involves in it the loss of many advantages. It becomes necessary, therefore, to appoint individuals to manage the subscription and receive the money. Mr Clymer and Mr Nixon having been formerly directors of the Bank of Pennsylvania, and being thereby generally known in that line, their names naturally present themselves for this purpose.
ART. 3d & 4th. The difference as to payments of large and small, is so common an incitement to subscribers, on such occasions, as to speak for itself.
ART. 5th. The subscribers, it is expected, will consist of citizens of every State in the Union; and, possibly, foreigners may subscribe or purchase bank stock; therefore the necessity and propriety of enabling them to vote by proxy; and this being a monied inst.i.tution, it is just that every share be ent.i.tled to a vote.
ART. 6th. As the stockholders will mostly be absent from the place where the bank is kept, the number of twelve seems quite sufficient for the direction, as they will generally be chosen from the residents, and there ought to be room left for rotation among these.
ART. 7th & 8th. This plan, if adopted, will be considered as the const.i.tution of the Bank, and therefore necessary to establish in it the powers of government by by-laws, rules, and regulations, and making dividends out of the profits; it is meant that they should annually pay a dividend of five or six per cent to the proprietors of the stock, and then settling the accounts of the bank, declare publicly, if necessary to give credit and confidence, what capital remains after such dividend. It will be observed, that such dividends are confined to be made out of the profits; consequently, the capitals can never be touched.
ART. 9th. When the directors, by paying a dividend out of the profits, establish the credit of the bank firmly in the minds of the stockholders, and by declaring the capital stock at the same time to be increased, give it equal confidence in the general opinion, there is little doubt but they may open new subscriptions for increasing the capital with certainty of success.
ART. 10th, 11th & 12th. As credit is the soul of all operations of this kind, every precaution should be taken to support it. In the course of things, much of the private property of America may be dependent on the conduct of affairs at the bank. Care, therefore, should be taken to prevent fraud and mismanagement. If the transactions were opened to public inspection, it would be impossible to do the business amidst the continued interruption; besides that, in this way, the national enemies would be apprized of our resources and operations. It is necessary, therefore, by inst.i.tuting a check, to guard against the ill consequences which lie in the way, as the public will have much connexion with the bank, and, at times, deposit considerable sums of money in it, and always be availing themselves of its credit. The check should be in the hands of that officer who is appointed to manage the monied interests of America.
ART. 13th & 14th. The penalties on fraud and embezzlement are derived from the same source, and are supported by the same reasoning.
ART. 15th & 16th. The necessity of incorporating the bank is obvious, and the propriety of rendering the office of a director honorable, rather than lucrative, arises from this circ.u.mstance, over and above the difference between motives of fame and interest, that at present, any adequate salaries would absorb the profits, and in future the care of their own interests as stockholders will be an additional inducement to the first characters to accept the direction, for it is not doubted but every subscriber will increase his capital in the bank, so soon as he finds not only the national advantages it will produce, but sees clearly his private interest advanced beyond his most sanguine expectations.
ROBERT MORRIS TO JOHN JAY.
Office of Finance, August 15th, 1781.
Sir,
Enclosed you have a list of sundry bills of exchange drawn on you. I wrote you relatively to these bills on the 29th day of July last, with sundry enclosures explanatory of my letter. I am now to inform you, that the advices contained in that letter must, from particular circ.u.mstances, be totally disregarded. Should any of the bills, mentioned in the enclosed list, come to your hands, you will be pleased to protest them, and a.s.sign, if you please, as a reason therefor, that you have express instructions to that purport. The uncertainty, whether you have received my cypher, prevents my using it on this occasion. The importance of the subject obliges me to write, and as I send many copies, the risk of capture and inspection is too great to be more particular.
The gazettes will furnish you with our latest intelligence. That of New York announces the arrival of near three thousand Hessian troops, and the capture of the Trumbull frigate. Neither of these is a very agreeable circ.u.mstance. However, we must wait the course of events, and struggle, as well as we can, against adverse fortune. Our affairs to the southward wear no unpleasing aspect. And, although it is impossible, at this distance, to determine what effect European movements may have on American politics, our government acquires daily a firmness and stability, which will not easily be shaken.
I have the honor to be, &c.
ROBERT MORRIS.
JAMES LOVELL TO JOHN JAY.
Philadelphia, August 15th, 1781.
Sir,
Herewith you will receive according to the resolution of Congress of the 10th, such information relative to the surrender of Pensacola, and the subsequent arrival of the garrison at New York, as I have been able to obtain, which you will make use of according to your discretion, and the spirit of the enclosed resolution.
I am, Sir, your friend and very humble servant,
JAMES LOVELL.
_P. S. August 16th._--It appears to me not amiss to enclose to you a report of a committee on the 10th, as it stands negatived on the journals of Congress. J. L.
TO THE PRESIDENT OF CONGRESS.
St Ildefonso, September 20th, 1781.
Sir,
Your Excellency"s favor of the 5th of July last, with the papers therewith enclosed, were delivered to me on the 29th ult. by Major Franks, whom the procrastination of the Minister still obliges me to detain.
The new commissions, with which Congress have honored me, argue a degree of confidence, which demands my warmest acknowledgments, and which, so far as it may be founded on an opinion of my zeal and integrity, they may be a.s.sured will not prove misplaced.
At the commencement of the present troubles, I determined to devote myself, during the continuance of them, to the service of my country, in any station in which she might think it proper to place me. This resolution, for the first time, now embarra.s.ses me. I know it to be my duty, as a public servant, to be guided by my own judgment only in matters referred to my discretion, and in other cases faithfully to execute my instructions, without questioning the policy of them. But there is one among those which accompanies these commissions, which occasions sensations I never before experienced, and induced me to wish that my name had been omitted.
So far as personal pride and reluctance to humiliation may render their appointment contra-agreeable, I view it as a very unimportant circ.u.mstance, and should Congress, on any occasion, think it for the public good to place me in a station inferior and subordinate to the one I now hold, they will find me ready to descend from the one, and cheerfully undertake the duties of the other. My ambition will always be more gratified in being useful than conspicuous; for, in my opinion, the solid dignity of a man depends less on the height or extent of the sphere allotted to him, than on the manner in which he may fulfil the duties of it.
But, Sir, as an American, I feel an interest in the dignity of my country, which renders it difficult for me to reconcile myself to the idea of the sovereign independent States of America submitting, in the persons of their Ministers, to be absolutely governed by the advice and opinions of the servants of another sovereign, especially in a case of such national importance.
That grat.i.tude and confidence are due to our allies, is not to be questioned, and that it will, probably, be in the power of France almost to dictate the terms of peace for us, is but too true. That such an extraordinary extent of confidence may stimulate our allies to the highest efforts of generous friendship in our favor is not to be denied, and that this instruction receives some appearance of policy from this consideration may be admitted.