I enclose you in this Packet the Plan of a national Bank, which I have been induced to adopt for the following Reasons.1 The issuing of a large Paper Medium converted the Coin of the Country into a Commodity; so that much of it was exported, and the Remainder concealed. The Depreciation of our Paper has so lessened our Currency that there is not a Sufficiency for Commerce and Taxation without creating by the latter such Distress in the former as must injure every Order of Men in the Community. It is necessary therefore to fill up the Deficiency in such Proportion as it may be called for and with such Medium as may preserve it’s Value.

I have already, in my Letter of the fourth Instant,2 stated the Want of ability in the People to lend and of Credit in the Government to borrow. An additional Reason, therefore, for establishing the Bank, is that the small Sums advanced by the Holders of Bank Stock may be multiplied, in the usual Manner by Means of their Credit, so as to increase the Resources which Government can draw from it; & at the same Time, by placing the collected Mass of private Credit between the Lenders & Borrowers, supply at once the Want of Ability in the one and of Credit in the other.

An additional Reason for this Institution is to supply the Place of all our other Paper, which it is my Design to absorp as soon as possible, and thereby to relieve the People from those Doubts and Anxieties which have weakened our Efforts relaxed our Industry and impaired our Wealth. But this must not be done without the Substitution of other Paper, for Reasons which I have already assigned, and because that our Commerce would suffer for the Want of that facility in Money Transactions which Paper alone can give.

Finally one very strong Motive which has impelled my Conduct on this Occasion, is to unite the several States more closely together in one general Money Connection, and indissolubly to attach many powerful Individuals, to the Cause of our Country, by the strong Principle of Self Love, and the immediate Sense of private Interest. It may not perhaps be improper to shew and explain this Plan to the Spanish Ministry. They will then perceive how, by an advance of Money, they may, in this Instance increase our Resourses and our Efforts in a Degree much superior to the immediate Sum; and they may be assured, that on a Variety of other Occasions, similar Benefits will result from it. I take this Opportunity however to observe to you, that I do not mean this or any other Communication should be absolutely made. It is, on the contrary, my unalterable Opinion that a prudent Minister on the Spot should be left to act with large Discretionary Power, being always furnished with such Details as will enable him to judge with Propriety and act with Decision.

It will undoubtedly strike your Observation, that the Sum of 400,000 Dollars is very small considering the Object which it is my Design to Effect. I acknowlege that it is so; and when I tell you, that I was very apprehensive we should be unable to fill a larger Subscription; and when I add, that it is very far from certain we shall get all of this moderate Sum; you will see still more clearly the force of those Observations which I have already made. But it is weakness, to be deterred by Difficulties from a proper Pursuit. I am therefore determined that the Bank shall be well supported, untill it can support itself and then it will support us. I mean that the Stock, instead of 400,000 Dollars shall be 4,000,000£ and perhaps more. How soon it will rise to that Amount it is impossible to foresee; but this we may venture to assert, that if a considerable Sum of Specie can speedily be thrown into it, the Period when its Force and Utility will be felt and known is not far off.

After I had determined to make that Application to the Court of Madrid, which is contained in my Letters, it was my next Object to obtain for you such Support as might materially favor your Operations. For this Purpose I have written to Doctr. Franklin and have told him that “you would receive by this Conveyance and forward to him Copies of those Resolutions and Letters which may be necessary to explain my Appointment and Powers.”3 I lay this Task on your Secretaries, because the want of Clerks in my Office, and the many Things to be done, together with the short time allowed me by the Departure of the Vessel prevent me from having Duplicates made out. I have written to the Doctor to apply to the Court of Versailles to further your Negotiations with their influence.4 I am confident his Application will not be unsuccessful; but how you may derive most benefit from the Cooperation of the french Court, you best can tell. Major Franks,5 therefore, is instructed to take your Orders for Passy, and return thence to Philadelphia, so that you will have an Opportunity of communicating fully with the Doctor on any Subject you think proper. You may write to me by any Opportunity, if this should arrive safe because our Cypher6 will prevent you from being exposed to interested or impertinent Curiosity.

To obtain for you still further Assistance I have applied (in the Absence of Monsr. de la luzerne who is gone to Camp) to Mr. de Marbois for Letters to their Ambassador at the Court of Madrid.7 I have stated my Views, my Hopes and Wishes with that Candor which is proper on such Occasions and which I wish to preserve on all Occasions. Mr. de Marbois has, in Consequence written a Letter on the Subject in which he informs the Ambassador of our Conversation, states the Disorders of our finances & make polite mention of my Operations, my Designs and Abilities, as well as of the Confidence reposed in me by Congress and by the People at large. He details the proposed Plans, and particularly that of the Bank, and shews forcibly the Advantages which would result from a considerable Advance of Money by Spain. He assigns also very proper Reasons to shew why it ought to be considerable if it be made at all. The great Interest of France in this Business, as well as the open and candid Manner which has marked all Transactions I have hitherto had with the Minister of that Nation induce me to believe that this Letter is more than Compliment and that, as it is intended so it will operate to produce the desired effect.

That Nothing in my Power might be wanting to the Success of a Business which you must be convinced I have much at Heart, I have also applied to don francisco Rendon, who at present acts here for Spain, and I have every Reason to believe that he will write to the Spanish Court such a Letter as I wish.8 But, after all much my dear Sir must depend on your Prudence, your Activity and your Attention to incline to Stimulate to lead the Ministry into our Views, to remove the Obstacles, surmount the Difficulties and crush the Procrastinations, which retard the Completion of an Object so essential to your Country. I am happy to add, that I have the utmost Confidence in your Abilities your Industry and Integrity.9

There is a Possibility, that Money may be obtained from Portugal, and tho I confess there is not a very solid Ground to build on, and tho it must be owned that Appearances are against us; Yet I think it best not to trust too much to Appearances either favorable or unfavorable, and to leave nothing unattempted which may be useful. It was for Reasons of this Sort that my Letter of the ninth Instant which I enclose you a Copy of was written to Congress. In Consequence of it, on the eleventh they passed a Resolution of which I also enclose you a Copy,10 and have only to add that you will act entirely according to your own Discretion on this Occasion. I cannot pretend to know the Situation of the Court of Lisbon, and therefore I will not attempt to measure out a Line of Conduct to be pursued there. You are, for every Reason more competent to this Business than I am, and therefore I submit it to your Management entirely.

You will observe that a material Part of my Letter of the ninth remains unnoticed by Congress. The Committee had not yesterday reported upon it. Should any Thing be done previous to the Departure of this Vessel you shall know it. But you are so well acquainted with the Delays incident to public Assemblies, that you will not be surprized if you hear Nothing farther on the Subject.11

It is unnecessary for me to make any other mention of Major Franks, except to inform you that after a critical Examination into his Conduct by a Court of Enquiry he was honorably acquitted of all improper Connection with his late General. For the rest, you are perfectly acquainted with him, and will therefore take that Notice of him which he deserves.12 With Sentiments of Esteem & regard I am Dr Sir Your obedt hble Servt