7 February 1811, New York. Offers JM his opinions on trade and political economy, prompted by a consideration of the “Pecul[i]ar manner in which the Government of the United States is situated regarding the Bank Charter.” Summarizes the state of U.S. trade with Europe, which has been interrupted for a number of years by the injustices of the belligerent powers. The continent is “almost compleatly sealed up” and the British market is glutted with American produce, creating a decline in revenue “which has afforded matter of triumph to the political oponents of the Government; and these oponents, in conjunction with a foreign faction, have unceasingly villified the party in power as the cause of evils which they have laboured incessantly to prevent.” Manufactures have sprung up, but they have not advanced since the country cannot actively support them.

Believes America’s foreign trade will not soon improve and claims “the chief cause is to be found in the rapacity of the British Fleet, and the Violent hatred which the British Court bear to Republican principles.” Surmises that “in the course of this spring a change of councils may take place in Britain” and that this could “bring about a General peace.” But this is uncertain. The “Revolution of Commerce” will continue, and the American government “will render an essential service to their Country, by making it really independant; and to Republican principles, by fixing them upon a Rock never to be shaken.”

Advocates that the American government pursue the following course of action. First, free the revenue from dependence on foreign commerce; second, reorder “monied institutions” so they do not harm Republican principles and establish a bank that will benefit commerce generally; and third, organize the “National property” to create a fund for internal improvements. Discusses each proposal in detail, particularly the plan for “a new National Bank; calculated to Consolidate and strengthen Republican principles; to encourage and support Manufactures, and internal Commerce; and to bring a large revenue to the public, to whom the profits of a paper circulation should exclusively belong.” Also notes “a few objections which may be urged against establishing such a Bank.” The “popular” argument—that “‘the Bank should be unconnected with the Government’”—is applicable to Great Britain but not to the U.S. The plan to establish banks independent of the government is “dangerous to Republican principles, as it has an evident tendency to raise up a monied Aristocracy.” Believes also that state governments should establish state banks and not grant charters and “peculiar priviledges” to “monied Men.” “The Constitutional objection of the right of the United States to establish branches, is done away by the plan of establishing them with Consent of the State Governments.” The next objection, “the want of Capital,” is “a very weak one” and can be met by issuing paper money. “No paper Currency, in this Country, could be so Substantially backed as that issued by a Bank belonging to the United States; for it would actually be the representative of the whole property in the Country.… A very small sum of the precious Metals is sufficient as a basis.” Admits there may be danger in changing an existing system for a new one, but these arguments have their limits and can be “set up as mere bug-bears … to put a stop to all improvement in the State of Society. The Arguments against renewing the old Charter are insuperable.” Asserts that the old bank can easily “wind up its affairs” and that the new bank, established at Washington, could realize annual profits in excess of $2 million. The revenue from import and tonnage duties will probably exceed $10 million, and this revenue, augmented by “a judicious application of the Public Lands,” will create an “ample fund” for internal improvements. Mentions that he has seen and conversed with Jefferson, to whom he has sent a copy of this letter. Adds in a postscript that his address is “John Melish New york.”