Thomas Jefferson Papers

To Thomas Jefferson from William C. C. Claiborne, 3 June 1804

From William C. C. Claiborne

New-Orleans 3 June 1804

Dear Sir,

By a late mail I received from the Secretary of the Treasury a letter concerning the Bank proposed to be established in this Territory, and find with sincere concern; that he is much dissatisfied with the measure. He questions the authority by which the scheme was sanctioned,—expresses apprehensions that it may defeat a project in contemplation, of establishing a Branch of the United States Bank in this city, and suggests the propriety of immediately recalling the Charter of the Louisiana Bank, or in some way arresting its further progress. To that letter, I have already written an answer of some length; but I trust you will pardon the liberty I take in offering to you a few lines on a subject seemingly of so much importance and one in which I have unexpectedly found my political reputation so deeply involved.

With respect to the Legislative powers with which I was invested, I thought them as comprehensive as those of the Governor and Intendant who had acted under the Spanish Government;—but I at the same time understood those powers to have been entrusted to me, in full confidence that they would never be exerted to their fullest extent, unless under the pressure of a strong political necessity.—When the Bank Ordinance was passed, that necessity appeared to me to exist in its full force.—The people here, elated to enthusiasm in expectation of rights and privileges and powers, thought Congress unseasonably slow in providing for their Government, & greatly unmindful of their interests in permitting the trade of New-Orleans to languish for want of a revenue System;—The proposed abolition of the Slave trade, had also excited the apprehensions of the farmers; in short every thing at this period wore an aspect of disaffection, which if confirmed, might not easily have been diverted.—The attachment of the citizens to the Government, I thought an object of primary importance, and that it became my duty to do everything in my power to effect it.—The moment was critical, and I felicitated myself in the opportunity which the merchants afforded me, of detaching them from the discontented party. With respect to the advantages arising to the Commonwealth from such institutions, I do not presume to decide; but the merchants whose interests are almost exclusively involved in them, have in this instance and on that point relieved me from all responsibility. When I passed the Ordinance it never occurred to me, that any but Territorial Interests were involved in it, nor am I yet sensible how those of the United States can be effected by the proposed establishment.—It seemed to me, that the merchants of New-Orleans might with propriety claim a benefit (a Bank) which did not appear to be denied to any one commercial City on the Atlantic Coast. With respect to my powers I must confess, I thought them somewhat doubtful; but the best informed people here thought them commensurate to the object.—It was represented to me, that the trade of the colony (excepting as to revenue) had occasionally been considered as an object of provincial regulation, and that the Spanish Governors had often granted commercial monopolies, particularly in the Indian trade:—It was further confidently stated to me, that Don André Lopez De Armesto (late Secretary to Louisiana under the Spanish Government) had given an opinion, that the power of the Governor to erect a Bank; if he thought the establishment expedient, was indisputable. Viewing therefore the question as to power, at least doubtful, I yielded to considerations of political expediency.

There is one of Mr. Gallatin’s objections to the Louisiana Bank which time will remove.—I mean his fear that it may prove destructive to the Branch Bank of the United States; for it is the general opinion (and which I believe to be correct) that were the Louisiana Bank in full vigour, a Branch Bank might also be established in this City which would completely answer the object, and fulfill the expectations of those who sent it.

As to a repeal of the incorporation of the Louisiana Bank, I fear it might involve some questions of difficulty and create some partial discontents here.—Perhaps it is fortunate, (if its suppression is deemed advisable) that the scheme is likely to fall by its own weakness.—The institution has for some time lingered on scarcely a moiety of its incipient capital, and the opinion of the Secretary (which is known) as to its legal existence, will I believe prove fatal to it.

I conceived it a duty due my character and feelings to give you this summary of the facts and reasonings which induced, and will go I trust to justify my conduct on this occasion; but should I not succeed, in conveying to your mind, a conviction in my favour I shall consider the establishment of the Louisiana Bank, as the most unfortunate act of my political life;—but this consoling reflection will remain to me, that if I have committed an error, it was one, into which I was betrayed by an honest zeal for the service of my country. If I have exceeded the bounds of my authority, it was not to gratify any little vanity, or idle thirst for power. If I have acted contrary to the wishes or instructions of my Government, it is because I knew them not. If I have thwarted any favorite fiscal arrangement, I sincerely regret it, but I cannot be justly censured for opposing what I never had an intimation of. In sanctioning the establishment of the Louisiana Bank, My God knows, that I had no private views to promote, no personal friends to gratify. As far as I am concerned, to an unaccusing conscience I can appeal, and assert, that the measure flowed from as pure motives of innocent and honest patriotism as ever guided a public functionary.

I pray you to pardon the liberty I have taken in addressing you this letter, and permit me to subscribe myself

With sentiments the most respectful Your faithful friend

William C. C. Claiborne

RC (DLC); in a clerk’s hand, signed by Claiborne; at foot of text: “Thomas Jefferson President of the United States”; endorsed by TJ as received 4 July and so recorded in SJL.

For Gallatin’s frustration over Claiborne’s chartering of the Louisiana bank, see Gallatin to TJ, 12 Apr. In his answer of 23 May to Gallatin, Claiborne defended the charter in terms similar to those above (Rowland, Claiborne Letter Books description begins Dunbar Rowland, ed., The Official Letter Books of W. C. C. Claiborne, 1801-1816, Jackson, Miss., 1917, 6 vols. description ends , 2:160-4).

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