Notes of a Conversation with George Washington on French Affairs, 27 December 1792
Notes of a Conversation with George Washington on French Affairs
Thursday Dec. 27. 92. I waited on the President on some current business. After this was over, he observed to me he thought it was time to1 endeavor to effect a stricter connection with France and that G. Morris should be written to on this subject. He went into the circumstances of dissatisfaction between Spain, Gr. Brit. and us, and observed there was no nation on whom we could rely at all times but France, and that if we did not prepare in time some support in the event of rupture with Spain and England we might be charged with a criminal negligence.2 (I was much pleased with the tone of these observations. It was the very doctrine which had been my polar star, and I did not need the successes of the Republican arms in France lately announced to us, to bring me to these sentiments. For it is to be noted that on Saturday last (the 22d.) I received Mr. Short’s letters of Oct. 9. and 12. with the Leyden gazettes to Oct. 13. giving us the first news of the retreat of the D. of Brunswic, and the capture of Spires and Worms by Custine, and that of Nice by Anselme.) I therefore expressed to the President my cordial approbation of these ideas: told him I had meant on that day (as an opportunity of writing by the British packet would occur immediately) to take his orders for removing the suspension of paiments to France which had been imposed by my last letter to G. Morris, but was meant as I supposed only for the interval between the abolition of the late constitution by the dethronement of the king and the meeting of some other body invested by the will of the nation with powers to transact their affairs. That I considered the national convention then assembled as such a body, and that therefore we ought to go on with the paiments to them or to any government they should establish. That however I had learned last night that some clause in the bill for providing reimbursement of the loan made by the bank to the U.S. had given rise to a question before the house of representatives yesterday which might affect these paiments; a clause in that bill proposing that the money formerly3 borrowed in Amstdm. to pay the French debt and appropriated by law (1790. Aug. 4. c. 34. s. 2.) to that purpose, lying dead as was suggested, should be taken to pay the bank, and the Presidt. be authorized to borrow 2. millions of Dol. more out of which it should be replaced,4 and if this should be done the removal of our suspension of paiment as I had been about to propose, would be premature. He expressed his disapprobation of the clause abovementioned, thought it highly improper in the legislature to change an appropriation once made, and added that no one could tell in what that would end. I concurred, but observed that on a division of the house the ayes for striking out the clause were 27. the Noes 26. whereon the Speaker gave his vote against striking out, which dividing the house, the clause for the disappropriation remained of course. I mentioned suspicions that the whole of this was a trick to serve the bank under a great existing embarrasment. That the debt to the bank was to be repaid by instalments, that the 1st. instalment was of 200,000 D. only, or rather 160,000 D. (because 40,000 of the 200,000 would be the U. States’ own dividend of the instalment) yet here were 2,000,000 to be paid them at once, and to be taken from a purpose of gratitude and honor to which it had been appropriated.
MS (DLC); entirely in TJ’s hand; written on recto and top of verso of a sheet containing “Anas” entry for 30 Dec. 1792; recorded in SJPL: “[Dec.] 27. 30. Conversns with the Pres. on French affairs. on the legitimacy of govmt.” Included in the “Anas.”
In accordance with the act passed by Congress in 1791 to incorporate the Bank of the United States, the government purchased $2,000,000 worth of shares in the Bank with part of the proceeds of loans that had previously been negotiated to discharge the public debt. In return, the Bank advanced the government $2,000,000 for reducing the public debt on condition that this loan be repaid in ten annual installments of at least $200,000 “or at any time sooner” (, ii, 2381; see also , xiii, 550–2). With the time for the first payment approaching, the House of Representatives began consideration of a bill on 24 Dec. 1792 that authorized the President to borrow an additional $2,000,000 in order to reimburse the Bank for its loan to the government. This bill aroused great opposition in the House. Arguing that the government’s stock in the Bank should be sold or, alternatively, that there was enough money on hand in the Treasury to pay the first installment to the Bank, opponents—led by James Madison and William Branch Giles—warned that the proposed new loan would impair the ability of the United States to pay its debt to France. Two days later, in the action TJ brought to the President’s attention in the conversation described above, a motion to amend the bill by reducing the amount of the intended loan to $200,000 was defeated as a result of the vote cast by speaker Jonathan Trumbull of Connecticut. At length, on 28 Feb. 1793, the House passed a bill, in which the Senate and the President promptly concurred, authorizing the President to make the first payment of $200,000 to the Bank from funds that had already been borrowed for the purpose of reducing the public debt (, iii, 753–61, 897–8, 1452). Even before this, however, the debate had resulted in a resolution passed by the House on 27 Dec. 1792 directing the President to provide a complete accounting of monies borrowed by the United States. A report from the Secretary of the Treasury made in compliance with this directive on 3 Jan. 1793 set the stage for a Republican effort, founded on resolutions introduced by Giles, to prove that Hamilton had mishandled public funds.
1. Here TJ canceled “begin.”
2. At this point TJ began a new sentence with the words “I expressed my appro,” then canceled them.
3. Here TJ canceled “appropriated.”
4. TJ initially ended the sentence here and began a new one with the words “he expressed his disapprobn” before canceling them and continuing with the foregoing sentence.