The situation of my department has been, for a long time, peculiarly embarrassed. My greatest solicitude and efforts have scarcely satisfied the common exigencies of the service; and I have the mortification to find, that in spite of all my endeavors the difficulties are every day increasing.

I have repeatedly mentioned to your Excellency for some months past, that the supplies of money furnished the department were very unequal to the current expences. I have all along flattered myself that affairs would take a new and more favorable turn. As Congress were delibarating upon the subject of finance, I was led to believe, that the schemes and plans they were adopting would afford more ample relief; and have encouraged the agents under such an expectation to proceed in the execution of the business. They have been enabled to extend their credit thus far, so as to keep the wheels in motion, hoping not to fail until government could find ways and means for furnishing us with cash more adequate to the demands. But whatever grounds I supposed there were for authorizing such expectations I now find they were vain and nugatory. The cloud thickens, and the prospects are daily growing darker. There is now no hope of cash. The agents are loaded with heavy debts, and perplexed with half-finished contracts, and the people clamorous for their pay, refusing to proceed in the public business, unless their present demands are discharged. The constant run of expences incident to the department presses hard for further credit, or immediate supplies of money. To extend one, is impossible; to obtain the other, we have not the least prospect. I see nothing therefore, but a general check if not an absolute stop to the progress of every branch of business in the whole department. I have little reason to hope that, with the most favorable disposition in the agents, it will be in our power to provide for the occasional demands of the army in their present cantonements; much less, to have in readiness the necessary apparatus and supplies of different kinds for putting the army in motion at the opening of the campaign. My apprehensions, of a failure in these respects, are so strong; and my anxiety, for the consequences, so great, that I feel it my duty once more, to represent to your Excellency our circumstances and prospects. From such a view of our situation, you may be led, not to expect more from us than we are able to perform, and may have time to take your measures consequent upon such information.

I know not whether government can command such sums of money as are necessary for the current expences of the nation; but it is a folly to expect, that this expensive department can be long supported on credit. A further attempt would only bring ruin and distress upon ourselves, without affording any substantial advantage, either to the public or the army; and therefore I think it is highly necessary, as all military movements are under your immediate direction; and as the affairs of this department are intimately connected with all the active operations, that you should have a right understanding with administration, with respect to the support they can give, in executing the measures you may think proper to take.

There is no deficiency in the resources of the country. On the contrary, I have authentic reasons to conclude the country is more plentifully stored with every material necessary for the provision and support of an army than it has been for three years past. The defect lies in a want of proper means to draw them into public use. I cannot see how a remedy will be applyed to this evil in the present management of finance. The wretched state in which that is involved, creates new obstructions and an accumulation of expences in every branch of the department.

Hitherto, our principal difficulty, has arose from a want of proper supplies of money, and from the inefficacy of that which we obtained; but now there appears a scene opening which will introduce new embarrassments. The Congress have recommended to the different states, to take upon themselves the furnishing certain species of supplies for our department.2 The recommendation falls far short of the general detail of the business; the difficulty of adjusting which, between the different agents, as well as the different authorities from which they derive their appointments, I am very apprehensive will introduce some jaring interests. many improper disputes, as well as dangerous delays. Few persons, who have not a competent knowledge of this employment can form any tolerable idea of the arrangements necessary to give dispatch and success in discharging the duties of the office; or see the necessity for certain relations and dependencies. The great exertions which are frequently necessary to be made, require the whole machine to be moved by one common interest, and directed to one general end. How far the present measures, recommended to the different states, are calculated to promote these desirable purposes, I cannot pretend to say; but there appears to me such a maze, from the mixed modes adopted by some states, and about to be adopted by others, that I cannot see the channels through which the business may be conducted, free from disorder and confusion.

It would be a folly for me to attempt to change the general disposition of mankind; or to flatter myself with the hopes of a different conduct from those who may be employed in the various branches of the department, than what is known to influence and govern men. If experiments are necessary, I have not the least objections to their being made, but I cannot agree to be responsible for consequenses. If government is distressed, and these expedients are requisite for her relief, my aid shall not be wanting, during my stay in the department, to give them a fair and full operation; but I cannot say, that I think they will either answer the expectations of the public, or prove competent to the demands of the army.

It cannot be more disagreable to your Excellency to receive, than it is to me, to make so unfavorable a representation. I have left no steps unattempted, that appeared calculated to put affairs on a more prosperous footing; and have hoped, that every succeeding account would be more promising, than the last. I should betray my trust, were I to amuse your Excellency with hopes and encouragements—And I beg, that this description of my department may, not only be considered, as justly drawn, but dictated by motives of duty, and aiming at the advantage of the public.3 I am with great respect Your Excellencys Most obedient humble Sert