To G. K. van Hogendorp
Paris Aug. 25. 1786.
Your favour of the 2d. instant has been duly received, and I employ the first moment which has been at my disposal to answer it. The author of the part of the new Encyclopedie which relates to Political oeconomy having asked of me materials for the article Etats-unis, and stated a great number of questions relative to them, I answered them as minutely and exactly as was in my power. He has from these compiled the greatest part of that article. I take the liberty of inclosing you one of these as it will give you all the details to which your letter leads, as exactly as it is in my power to furnish them. I can even refer you to the passages which answer your several questions.
What is the extent of the Congress’s power in managing the interests of the U. States? The 6th. and 9th. articles of the Confederation define their powers. Those which it is thought they still need you will find indicated in this pamphlet pa. 29. 30. and in page 31.b. their powers of coercion?
Qu. Which are the expences of Congress?
Ans. pages 42.b. and 43.b.
Qu. Which the revenues?
Ans. As yet they have no standing revenues; they have asked standing revenues as shall be noted under a subsequent question. In the mean time they call annually for the sums necessary for the federal government. See pages 43. 44.
Qu. In which way do the particular states contribute to the general expences?
Ans. Congress once a year calculate the sum necessary the succeding year to pay the interest of their debt, and to defray the expences of the federal government. This sum they then apportion on the several states according to the table page 44.a. and the states thereon raise each it’s part by such taxes as they think proper.
Qu. Are general duties, to be levied by Congress, still expected to be acquiesced to by the states?
Ans. See page 30.a. New York the only state which had not granted the impost of 5. per cent, has done it at a late session; but has reserved to herself the appointment of the collectors. Congress will not receive it upon that condition. It is beleived that New York will recede from the condition. Still a difficulty will remain. The impost of 5. per cent not being deemed sufficient to pay the interest of our whole debt foreign and domestic, Congress asked at the same time (that is in 1783) supplementary funds to make good the deficiency. Several of the states have not yet provided those supplementary funds. Some of those which have provided them have declared that the Impost and Supplementary fund shall commence only when all the states shall have granted both. Congress have desired those states to uncouple the grants, so that each may come into force separately as soon as it is given by all the states. Pennsylvania has declined this, saying that if the impost be granted alone, as that will do little more than pay the interest of the foreign debt, the other states will be less urgent to provide for the interest of the domestic debt. She wishes therefore to avail herself of the general desire to provide for foreign creditors in order to enforce a just attention to the domestic ones. The question is whether it will be more easy to prevail on Pennsylvania to recede from this condition or the other states to comply with it. The treaties with the Indians have experienced a greater delay than was expected. They are however completed, and the Surveyors are gone into that country to lay out the land in lots. As soon as some progress is made in this, the sale of lands will commence, and I have a firm faith that they will in short time absorb the whole of the certificates of the domestic debt.
The Philadelphia bank was incorporated by Congress. This is perhaps the only instance of their having done an act which they had no power to do. Necessity obliged them to give this institution the appearance of their countenance, because in that moment they were without any other resource for money. The legislature of Pennsylvania however passed an act of incorporation for the bank, and declared that the holders of stock should be responsible only to the amount of their stock. Lately that legislature has repealed their act. The consequence is that the bank is now altogether a private institution and every holder is liable for it’s engagements in his whole property. This has had a curious effect. It has given those who deposit money in the bank a greater faith in it, while it has rendered the holders very discontented, as being more exposed to risk, and has induced many to sell out, so that I have heard (I know not how truly) that bank stock sells somewhat below par. It has been said 7½ per cent; but as the publication was from the enemies of the bank, I do not give implicit faith to it.—With respect to the article (Etats unis) of the Encyclopedie now inclosed I am far from making myself responsible for the whole of the article. The two first sections are taken chiefly from the Abbé Raynal, and they are therefore wrong exactly in the same proportion. The other sections are generally right. Even in them however there is here and there an error. But on the whole it is good; and the only thing as yet printed which gives a just idea of the American constitutions. There will be another good work, a very good one, published here soon by a Mr. Mazzei who has been many years a resident of Virginia; is well informed, and possesses a masculine understanding. I should rather have said it will be published in Holland, for I believe it cannot be printed here.—I should be happy indeed in an opportunity of visiting Holland; but I know not when it will occur. In the mean time it would give me great pleasure to see you here. I think you would find both pleasure and use in such a trip. I feel a sincere interest in the fate of your country, and am disposed to wish well to either party only as I can see in their measures a tendency to bring on an amelioration of the condition of the people, an increase in the mass of happiness. But this is a subject for conversation. My paper warns me that it is time to assure you of the esteem & respect with which I have the honour to be Dear Sir your most obedient humble servant,
RC (Rijksarchief, The Hague, Hogendorp Papers). PrC (DLC). Noted in SJL under 26 Aug. but the date on the letter itself is 25 Aug. Enclosure: Démeunier’s Essai sur les Etats-Unis (see under 22 June 1786).
This was the last letter in the exchange between TJ and van Hogendorp, and they evidently did not meet when TJ was in Holland in 1788.