The enclosed letters from Govr. Claiborne to Mr Madison were communicated to me with a request that they should be transmitted to you. On the subject of the seamen, Mr. Trist will receive the proper instructions as soon as Dr. Barnwell’s answer shall have been obtained. But Mr Claiborne’s conduct respecting the establishment of a Bank appears inexplicable; for you will find by the enclosed paragraph of a New York paper that, without waiting for an answer, he has already authorised the institution. In so doing, he appears to me to have exceeded his powers; and he has thereby, without his knowledge it is true, acted contrary to the intention and even to an act of Congress, and will probably defeat the establishment of a Branch Bank which we considered of great importance, to the safety of the revenue and as a bond of union between the Atlantic and Mississippi interests.

His powers were no greater than those of a Spanish Governor or Intendant, and these were confined to temporary ordinances and not to the making of laws of a permanent nature, much less to granting charters which could not be revoked by a successor. The argument indeed of the Governor, drawn from the general power of passing ordinances for the improvement of the Province, shows that only temporary ordinances and such as might be revoked could have been meant; otherwise it would have been a complete transfer of the legislative authority. But Mr Claiborne knew also that the powers vested in him were so loosely defined through necessity alone and on account of the urgency of the case; he knew that they were given for a short time and that every mail might supercede them by the arrival of a law establishing a permanent form of Government; he must have been fully aware that an executive charter was unknown to our Government; and he should have felt that, of all acts of Govt., none perhaps was more delicate, none required greater discretion & caution to guard it against improper speculations than the granting of a bank charter. It seems inexcusable that he should, under all those circumstances, have abused the confidence vested by the Legislature in the Executive, and by the Executive in him, by doing an act of the highest legislative nature and one which, (except by himself) cannot be revoked, without even consulting the President or Secretary of State; and I cannot account for this strange conduct in any other way than by ascribing it to the arrival and influence of Edward Livingston. The speculations shall have been forcibly pressed on the Governor, and he has unfortunately yielded. I wish that, at least, he may not be personally concerned but have been informed, through Lyon’s channel, that Gen. Wilkinson was interested in it.

That the Legislature had in view the establishment of a Branch of the Bank of the United States is evident from their acts; and the law which extends to the ceded territories the operation of all the acts concerning the Bank of the United States, precludes, during the continuance of its charter, the establishment of any other bank in the said territories.

The establishment of a branch was so advantageous to the revenue, and, on account of the distance, so inconvenient to the Bank of the United States, that it is with great difficulty and by making arrangements for the sole purpose of surmounting the difficulties in the way, that I was able to prevail on that institution to assent to the measure. Much do I apprehend that they will seize this opportunity of refusing to proceed: and it is truly vexatious that the plans of this Department carried under the sanction of a law, should be defeated by such unexpected and unauthorised interference. I will write to Govr. Claiborne, but can only write a private letter, as there is no connection between his office and the Treasury. My idea is that he should, by virtue of the same authority which granted, revoke the charter, leaving the Louisiana Bank on the footing of a private association.

With sincere respect & attachment Your obedt. Servt.