From Gouverneur Morris
Sain Port 7. August 1793
Enclos’d herewith you will find my Account up to the first of the last month. I did not send it sooner because I wish’d to comprize therein those of the Consulates none of which are come forward. I shall therefore write to them on the Subject. You will observe that I charge therein 24 given to an American Sea Officer. He appear’d to be, and really was, in very great distress, so that I could not avoid giving what I conceiv’d needful to carry him to the nearest Seaport. He has since applied to me again repeatedly but he has been refus’d all farther aid. You will find also a Charge for engraving passports. This became necessary because from the Time of my arrival, or very shortly after it, the Difficulties in the way of travelling were so great that people with all formalities required by Law could scarcely get along, And among the Municipalities a handsome Piece of Paper with a seal to it had much more Effect than the ministerial Signatures. If however either or both of these Charges be deem’d improper Let them be recharg’d to me. I sent out more Pamphlets than those I have brought to account, because when an Opportunity offer’d I put up not only those I had procured for your Office, but all others which were at Hand, and which having been originally purchased for my own Information I did not think it proper to charge them to the United States.
I also enclose herein a Table of the Value of the Assignats compared with Specie for one year ending with last June. During the Month of July they may be stated at about 20 per % But upon that Value as well as on those contain’d in the Table it is necessary to observe First that the Fluctuations of Exchange are great, so that to determine with precision the Value requires Information which I beleive it is impossible to acquire. For instance Louis d’ors have sometimes borne a premium of above 5 per % compared with Silver, and other Times have gone at Par. Nay this Change has taken place from one Day to another, and on the same day there has been a difference of above 5 per % in the price of Specie. It would be necessary therefore to know at which of two such different prices the greatest Sum was negotiated, and also in other cases whether the principal Negotiations were in Gold or Silver. At first sight indeed it might be supposed that the metal of highest price was the one principally bought, but I am assured that this rule did not hold good: and as for the Reason why it did not hold, we must seek in the Trick of the Day, or the Lie of the Day. Sometimes also in the Searchings and Plunderings. But secondly, This Table however accurate it might be, would not I conceive form a proper Standard on which to proceed in our Custom Houses; because the Value of Comodities has been by no means dependent on that of the assignats. The prices have considerably encreased but not proportionately; and the particular encrease depends on the article, so that a History of each would be necessary. Bread (altho Supplies have constantly been brought from abroad) has been kept very nearly to the old Standard. Flesh is more than double, Vegetables four five or six Times as dear as formerly. Merchandizes for export have not risen in Proportion, Wines and Brandies were getting up rapidly, but the War damped them. They took afterwards a great Rise from the Demand of the Armies so that the low Burgundies got up to the price of the High almost. I am not enough acquainted with the Subject to go into the needful Details, and only say thus much to shew that Merchandizes did not depend for Price on the same Principles with the precious metals, since these last were purchased by the Nation for its Armies; by the Emigrants for their Support; and by People in general as a Ressource in the moment when Paper should be decried. Lastly; the Price of Specie did not go on regular Principles of Apportionment or Comparison with the mass of Paper. In the months of May and June 1792 it rose because the old Ministers having purchased large Sums of Specie, their Successors found that they could dispense with immediate Supplies. In July August and September, Notwithstanding the political Events it was kept tolerably steady by Stock jobbing manoeuvres back’d with the sums in the Treasury, and also by the fear of plunder after the tenth of August: for many were plundered during the Visites domiciliares and it was given out by Authority that Specie would be taken by force and Paper given in Exchange. The benefits which those at the Center of these Operations expected to derive were prevented by the great and unlook’d for Success of the french Arms in October and November. In the End of that last Month, and in the Beginning of December, the Proportion was about 73. per Cent being higher than is stated in the Table, because in November the Exchange was lower in the Beginning and in December at the End of the month, wherefore the Average of each is diminished. In the month of December the Trial of the King, the Probability that he would be put to Death, the Consequences naturally resulting from that Catastrophe, the certainty of another and more serious Campaign, the Situation of the Armies, and in fine the abundance of the Assignats, when the Cold Weather forc’d back presumptuous Hope into the Region of austere Reflection brought down the Exchange to about 60 per %. In January it was tolerably steady at about 58 And in February at about 56. The paper during this Period went on its natural Course of gentle Decay. In the Beginning of March it was still at about 56 but the Successes of the Enemy shortly after reduced it to 48. In the Beginning of April it was brought down to about 44 so that in one month’s Time it lost about ⅕ of its Value. From that time it went on gradually again being about 42 at the End of April, and then rapidly so as to be at about 30 in the End of June consequently the Degradation monthly for those two months was about ⅙ each. But in July it took a terrible Plunge viz from 30 to 20 being ⅓ of the value taken off in a few days. This was owing in Part to a view of public affairs both foreign and domestic and partly to Stock Jobbing manœuvres carried on by Authority with a view to ruin the Stock Jobbers. These manoeuvres had in Part their Effect for having forced the Exchange below its natural Level it rose towards the End of the month and of Course those who speculated on a farther fall were taken in. The prime movers did indeed expect a wonderful rise from taking out of Circulation about 1700,000,000 on which the Kings Head is impress’d, but this Stroke was broken by the necessity of confining it to one Half the Sum, being the large Assignats, because the small ones dispersed in the Hands of the Sans Culottes might have deprived the Government of the Support of its Friends. But besides this the Stroke was in itself a bad one because it injures the Paper more by destroying its Credit than it benefits what remains by lessening the mass even could the mass be thereby lessened which it is not for all the Effect is to give a different Direction to the proscribed paper in those Districts which respect the Decree. Many people persist in believing that the Assignats with that condemn’d Impression are better than the others and even that their value is encreas’d by the Decree which drawing a Line of division between them leaves the future Government at Liberty to annul the Circulation now favored with an Appearance of Justice. You will observe that Men calculate upon the Dissolution of the present System as on a Datum, altho the Period in which it is to arrive is considered as uncertain. It is far from impossible that they reckon without their Host but the Opinion is as important as the thing in Respect to a Species of money whose Value depends on Opinion. Another Circumstance which should have been taken into Consideration and which was not duly weighed is that the Value of the mass of Paper depends on the Course in the Capital and there the new Assignats must be rather more plentiful than the old; of Course destroying the old cannot do much good to the new and besides the holders of the Old as well as the New being in Effect the great money Dealers they can by their united efforts apportion the value to each as they please and their common Interest will excite a common Action. And they have over the Government an Advantage which no power of Legislation can compensate because they act with the paper in Circulation and the Government with that which goes to encrease the Circulation and which of Course lessens the Value they wish to encrease. From all this I conclude that the Paper must go on perishing Day by Day and like other consumptive Patients be alike weakened by the Doctor and the Disease. On the whole Sir, to return to your original Object, I beleive the safest way in America and the most equitable would be to value Articles imported from this Country at the Prices of 1788. I am with Respect and Esteem Dr. Sir Your Obedient Servant
P.S. I will continue to send you the State of Depreciation according to your Orders and exactly as I can.
Dupl (DNA: RG 59, DD); in a clerk’s hand, signed by Morris; at head of text: “No. 34 Duplicate”; at foot of first page: “Thomas Jefferson Esqr. Secretary of State”; endorsed by Edmund Randolph as received 19 Mch. 1794. FC (Lb in DLC: Gouverneur Morris Papers). Tr (Lb in DNA: RG 59, DD). Enclosures: (1) Morris’s account with the United States, 1 Aug. 1793. (2) Table showing the specie value of French paper money from June 1792 to June 1793 (Trs in same). Enclosed in Morris to TJ, 22 Sep. 1793.
TJ submitted the missing recipient’s copy of this letter to the President on 11 Nov. 1793, the date he received it according to SJL, and Washington returned it the same day (Washington, Journal description begins Dorothy Twohig, ed., The Journal of the Proceedings of the President, 1793–1797, Charlottesville, 1981 description ends , 251).