To Thomas Jefferson
Philada. Aug: 12th. 1786
My last of the 19th. of June intimated that my next would be from N. York or this place. I expected it would rather have been from the former which I left a few days ago, but my time was so taken up there with my friends and some business that I thought it best to postpone it till my return here. My ride through Virga. Maryd. & Pena. was in the midst of harvest. I found the crops of wheat in the upper parts of the two former considerably injured by the wet weather which my last described as so destructive in the lower parts of those States. The computed loss where I passed was about one third. The loss in the Rye was much greater: It was admitted however that the crops of both would have been unusually large but for this casualty. Throughout Pena. the wheat was unhurt, and the Rye very little affected. As I came by the way of Winchester & crossed the Potowmac at Harpers Ferry I had an opportunity of viewing the magnificent scene which nature here presents.1 I viewed it however under great disadvantages. The air was so thick that distant objects were not visible at all, and near ones not distinctly so. We ascended the mountain also at a wrong place, fatigued ourselves much in traversing it before we gained the right position, were threatened during the whole time with a thunder storm, and finally overtaken by it. Had the weather been favorable the prospect would have appeared to peculiar advantage, being enriched with the harvest in its full maturity, which filled every vale as far as the eye could reach. I had the additional pleasure here of seeing the progress of the works on the Potowmac. About 50 hands were employed at these falls or rather rapids, who seemed to have overcome the greatest difficulties. Their plan is to slope the fall by opening the bed of the river, in such a manner as to render a lock unnecessary, and by means of ropes fastened to the rocks, to pull up & ease down the boats where the current is most rapid. At the principal falls 150 hands I was told were at work, and that the length of the canal will be reduced to less than a mile, and carried through a vale which does not require it to be deep. Locks will here be unavoidable. The Undertakers are very sanguine.2 Some of them who are most so talk of having the entire work finished in three years. I can give no particular account of the progress on James River, but am told it is very flattering. I am still less informed of what is doing with North Carolina towards a Canal between her & our waters. The undertaking on the Susquehannah is said to be in such forwardness as to leave no doubt of its success. A negociation is set on foot between Pena. Maryd. & Delaware for a canal from the head of Chesapeak to the Delaware. Maryd. as I understand heretofore opposed the undertaking, and Pena. means now to make her consent to it a condition on which the opening of the Susquehannah within the limits of Pena. will depend. Unless this is permitted the opening undertaken within the limits of Maryland will be of little account. It is lucky that both parties are so dependent on each other as to be thus mutually forced into measures of general Utility. I am told that Pena. has complied with the joint request of Virga. and Maryland for a Road between the head of Potowmac and the waters of the Ohio and the secure & free use of the latter through her jurisdiction. These fruits of the Revolution do great honour to it. I wish all our proceedings merited the same character. Unhappily there are but too many belonging to the opposite side of the acct.3 At the head of these is to be put the general rage for paper money. Pena. & N. Carolina took the lead in this folly. In the former the sum emitted was not considerable, the funds for sinking it were good, and it was not made a legal tender. It issued into circulation partly by way of loan to individuals on landed security, partly by way of payment to the public Creditors. Its present depreciation is about 10 or 12 Per Ct. In N. Carolina the sums issued at different times has been of greater amount, and it has constantly been a tender. It issued partly in payments to military creditors, and latterly in purchases of Tobo. on public account. The Agent I am informed was authorized to give nearly the double of the current price, and as the paper was a tender, debtors ran to him with their Tobo. and the Creditors paid the expence of the farce. The depreciation is said to be 25 or 30 Per Ct. in that State. S. Carolina was the next in order. Her emission was in the way of loans to individuals, and is not a legal tender. But land is there made a tender in case of suits, which shuts the Courts of Justice, and is perhaps as great an evil. The friends of the emission say that it has not yet depreciated, but they admit that the price of commodities has risen, which is evidently the form in which depreciation will first shew itself. New Jersey has just issued £30,000 (dollar at 7/6), in loans to her Citizens. It is a legal tender. An addition of £100,000 is shortly to follow on the same principles. The terror of popular associations stifles as yet an overt discrimination between it & specie; but as this does not operate in Philada. & N. York where all the trade of N. J. is carried on, its depreciation has already commenced in those places & must soon communicate itself to N. J. New York is striking £200,000 (dollr. at 8/-) on the plan of loans to her Citizens. It is made a legal tender in case of suits only. As it is but just issuing from the press, its depreciation exists only in the foresight of those who reason without prejudice on the subject. In Rhode Island £100,000 (dolr. at 6/.) has lately been issued in loans to individuals. It is not only made a tender, but severe penalties annexed to the least attempt direct or indirect to give a preference to specie. Precautions dictated by distrust in the rulers, soon produced it in the people. Supplies were witheld from the Market, the Shops were shut, popular meetings ensued, and the State remains in a sort of Convulsion. The Legislature of Massts. at their last Session rejected a paper emission by a large majority. Connecticut & N. Hampshire also have as yet foreborne, but symptoms of the danger it is said begin to appear in the latter. The Senate of Maryd. has hitherto been a bar to paper in that State. The clamor for it is now universal, and as the periodical election of the Senate happens at this crisis, and the whole body is unluckily by their constitution to be chosen at once, it is probable that a paper emission will be the result. If in spite of the zeal exerted agst. the old Senate a majority of them should be reelected, it will require all their firmness to withstand the popular torrent. Of the affairs of Georga. I know as little as of those of Kamskatska.4 Whether Virga. is to remain exempt from the epidemic malady will depend on the ensuing Assembly. My hopes rest chiefly on the exertions of Col. Mason and the failure of the experiments elsewhere. That these must fail is morally certain; for besides the proofs of it already visible in some States, and the intrinsic defect of the paper in all, this fictitious money will rather feed than cure the spirit of extravagance which sends away the coin to pay the unfavorable balance, and will therefore soon be carried to market to buy up coin for that purpose. From that moment depreciation is inevitable. The value of money consists in the uses it will serve. Specie will serve all the uses of paper. Paper will not serve one of the essential uses of specie.5 The paper therefore will be less valuable than specie. Among the numerous ills with which this practice is pregnant, one I find is that it is producing the same warfare & retaliation among the States as were produced by the State regulations of commerce. Massts. & Connecticut have passed laws enabling their Citizens who are debtors to Citizens of States having paper money, to pay their debts in the same manner as their Citizens who are Creditors to Citizens of the latter States are liable to be paid their debts.
The States which have appointed deputies to Annapolis are N. Hampshire, Massts. R. Island, N. Y. N. J. Pena. Delaware & Virga. Connecticut declined not from a dislike to the object, but to the idea of a Convention, which it seems has been rendered obnoxious by some internal Conventions which embarrassed the Legislative Authority. Maryd. or rather her Senate negatived an appointment because they supposed the measure might interfere with the plans or prerogatives of Congs. N. Carolina has had no Legislative meeting since the proposition was communicated. S. Carolina supposed she had sufficiently signified her concurrence in a general regulation of trade by vesting the power in Congs. for 15 years. Georgia ——6 Many Gentlemen both within & without Congs. wish to make this Meeting subservient to a Plenipotentiary Convention for amending the Confederation. Tho’ my wishes are in favor of such an event, yet I despair so much of its accomplishment at the present crisis that I do not extend my views beyond a Commercial Reform. To speak the truth I almost despair even of this. You will find the cause in a measure now before Congress of which you will receive the details from Colo. Monroe.7 I content myself with hinting that it is a proposed treaty with Spain one article of which shuts the Mississipi for twenty five or thirty years. Passing by the other southern states figure to yourself the effect of such a stipulation on the assembly of Virginia already jealous of northern policy8 and which will be composed of about thirty members from the western waters; of a majority of others attached to the western country from interests of their own[,] of their friends or their constituents and of many others who though indifferent to the Mississipi will zealously play off the disgust of its friends against federal measures. Figure to yourself its effect on the people at large on the western waters who are impatiently waiting for a favorable result to the negociation with Guardoqui: & who will consider themselves as sold by their Atlantic brethren. Will it be an unnatural consequence if they consider themselves as absolved from every federal tie and court some protection for their betrayed rights? This protection will appear more attainable from the maritime power of Britain than from any other quarter and Britain will be more ready than9 any other nation to seize an opportunity of embroiling our affairs. What may be the motive with Spain to satisfy herself with a temporary occlusion of the Mississipi at the same time that she holds forth our claim to it as absolutely inadmissible is matter of conjecture only. The patrons of the measure in Congress contend that the minister who at present governs the Spanish councils means only to disembarass10 himself at the expence11 of his successors. I should rather suppose he means to work a total separation of interest and affection between the western and eastern settlements and to foment the jealousy between the eastern12 & southern States. By the former the population of the western country it may be expected, will be checked and the Mississipi so far secured and by both the general security of Spanish America be promoted. As far as I can learn the assent of nine states in Congress will not at this time be got to the proposed13 treaty but an unsuccessful attempt by six or seven will favor the views of Spain and be fatal I fear to an augmentation of the federal authority, if not to the little now existing. My personal situation is rendered by this business particularly mortifying. Ever since I have been out of Congress I have been inculcating on our assembly a confidence in the equal attention of Congress to the rights and interests of every part of the republic and on the western members in particular, the necessity of making the Union respectable by new powers to Congress if they wished Congress to negociate with effect for the Mississipi. I leave to Col. Monroe the giving you a particular account of the Impost. The Acts of Penna. Delaware & N. York must be revised & amended in material points before it can be put in force, and even then the fetters put on the collection by some other States will make it a very awkward business. Your favor of 25th. of April from London found me here. My letter from Richmd. at the close of the Assembly will have informed you of the situation in which British debts stand in Virga.14 Unless Congs. say something on the subject I do not think any thing will be done by the next Session. The expectations of the British Merchants coincide with the information I had recd.; as your opinion of the steps proper to be taken by the Assembly, do with those for which I have ineffectually contended. The merits of Mr. P.15 will ensure every attention from me to his claim as far as general principles will admit. I am afraid that these will insuperably bar his wishes. The Catalogues sent by Mr. Skipwith I do not expect to receive till I get back to Virga. If you meet with “Graecorum Respublicae ab Ubbone Emmio descriptae,” Lugd. Batavorum, 1632, pray get it for me.
My trip to N. Y. was occasioned chiefly by a plan concerted between Col. Monroe & myself for a purchase of land on the Mohawk. Both of us have visited that district, and were equally charmed with it. The soil is perhaps scarcely inferior to that of Kentucky, it lies within the body of the Atlantic States, & at a safe distance from every frontier. It is contiguous to a branch of Hudson’s River which is navigable with trifling portages which will be temporary, to tide-water, and is not more than ten, 15 or 20 miles from populous settlements where land sells at £8 & £10 per Acre. In talking of this Country sometime ago with General Washington he considered it in the same light with Monroe and myself, intimating that if he had money to spare and was disposed to deal in land, this is the very spot which his fancy had selected out of all the U. S. We have made a small purchase, and nothing but the difficulty of raising a sufficient sum restrained us from making a large one. In searching for the means of overcoming this difficulty, one has occurred which we have agreed that I should mention to you and which if you should think as we16 do is recomended by the prospect of advantage to your self as well as to us. We mention it freely because we trust that if it does not meet your sanction17 you will as freely tell us so. It is that the aid of your credit in your private capacity be used for borrowing say, four or five thousand louis more or less, on the obligation of Monro and myself, with your suretyship to be laid out by Monro and myself for our triple emolument: an interest not exceeding six per cent to be paid annually and the principal within a term not less than eight or ten years. To guard agst. accidents a private instrument might be executed among ourselves specifying all necessary covenants. We have not taken the resolution of submitting18 this plan without well examining the expediency of your becoming a party to it as well as the prospect of its succeeding. There can certainly be no impropriety in your taking just means of bettering your fortune nor can we discover any in your doing this on the Mohawk more than on James River. For the prospect of gain by the rise of the land beyond the interest of the money we calculate on the present difference of price19 between the settled and vacant land far beyond any possible difference in the real value. The former as has been noted sells for eight or ten pounds per acre. The latter distinguished only by its being a little higher up the river & its being uninhabited was bought by us for one dollar and a half and there is little doubt that by taking a larger quantity, still better bargains may be got. This comparative cheapness proceeds from causes which are accidental & temporary. The lands in question are chiefly in the hands of men who hold large quantities, and who are either in debt or live in the city at an expence for which they have no other resource or are engaged in transactions that require money. The scarcity of specie which enters much into the cheapness is probably but temporary also. As it is the child of extravagance it will become the parent of economy which will regain us our due share of the universal medium. The same vicicitude which can only be retarded by our short lived substitutes of paper will be attended also by such a fall in the rate of exchange that money drawn by bills from Europe now and repaid a few years hence will probably save one years interest at least & I will only add that scarce an instance has happened in which purchases of new lands of good quality and in good situations have not well rewarded the adventurers. With these remarks which determine our judgments we submit to your better one the project to which they relate. Wishing you every possible happiness I remain Dr Sir your affectionate friend & Servt.
Js. Madison Jr.
Mrs. House & Mrs. Trist desire to be particularly remembered to yourself & Miss Patsy. I left with Col. Monroe let[t]ers for you both from Mrs. T. which will probably go by the same packet with this.
RC (DLC). Italicized words, unless otherwise noted, are those encoded by JM using the code Jefferson sent him on 11 May 1785. Jefferson’s secretary, William Short, inserted an interlinear decoding in the Ms.
1. In describing the view from above Harpers Ferry, JM was paraphrasing his correspondent. In his admiring description of the same spot, Jefferson said the “passage of the Patowmac through the Blue ridge is perhaps one of the most stupendous scenes in nature” (Notes on Virginia [Peden ed.], p. 19).
2. The most sanguine supporter of the Potomac Canal Company was its chief patron, George Washington. The General told Lafayette “that men who can afford to lay a little while out of their money are laying the foundation of the greatest returns of any speculation I know of in the world” (Freeman, George Washington, VI, 29 n.; George W. Ward, The Early Development of the Chesapeake and Ohio Canal Project [Baltimore, 1899], pp. 12–17).
3. In contrast with JM’s account of national welfare was a New Englander’s view that “we are fast recovering from the fatigue of the Warr, and like a young Man who by sleep shakes off his Weariness, we are by two or three years quiet, so far recover’d as to run into every kind of Luxury and Extravagance and not so much by Credit as formerly” (Stephen Mix Mitchell to William Samuel Johnson, 9 Aug. 1786, Burnett, Letters description begins Edmund C. Burnett, ed., Letters of Members of the Continental Congress (8 vols.; Washington, 1921–36). description ends , VIII, 418).
4. The Georgia legislature, controlled by back country members, approved a £50,000 paper money issue in 1786 but owing to a variety of circumstances only £30,000 was actually issued (Nettels, Emergence of a National Economy, p. 81).
5. As in 1779–1780, JM’s views on paper money were tied to the ready convertibility of paper currency into specie. In his earlier view, JM held that when hard money was readily paid on demand the quantity of paper money in circulation had no effect on its depreciation—“its value does not depend on its quantity. It depends on the credit of the state issuing it, and on the time of its redemption” (Papers of Madison description begins William T. Hutchinson et al., eds., The Papers of James Madison (9 vols. to date; Chicago, 1962——). description ends , I, 304). JM was familiar with Adam Smith’s strictures on money but apparently disagreed with the latter’s contention that a “well-regulated paper money” was not only an acceptable substitute for specie, “but, in some cases, with some advantages” over hard money (Smith, Wealth of Nations, Book IV, quoted in William R. Allen, ed., International Trade Theory: Hume to Ohlin [New York, 1965], p. 45).
6. Georgia apparently did not appoint deputies. Preoccupied with local concerns—recovery from the destruction of the war, lack of specie, territorial disputes with Indians and deterred by the distance from Congress, Georgia tended to ignore federal responsibilities. Her congressional delegations were wholly absent during 1783 and part of 1784. From 1785 onward, at least two Georgia delegates served in Congress (Houstoun and Few) but a full representation was not present until September 1788. Houstoun’s “regular attendance may be accounted for by a love affair that kept him in New York” tending personal as well as state business (Coleman, American Revolution in Georgia, 1763–1789, pp. 253–57).
7. Monroe’s detailed account of the Jay-Gardoqui negotiations was written to Jefferson on 19 Aug. 1786 (Boyd, Papers of Jefferson description begins Julian P. Boyd et al., eds., The Papers of Thomas Jefferson (19 vols. to date; Princeton, N. J., 1950——). description ends , X, 274–79).
8. Decoded northern politics and then corrected (by Short?).
9. JM’s code “947” erroneously te but corrected to than by Short.
10. JM’s code omitted “1001,” ba, needed for the complete word.
11. In code ex but fully spelled out by Short.
12. In code ern but fully spelled out by Short.
13. When JM gained possession of this letter at some later day he wrote “projected” in the margin, but Short had correctly decoded “493” as proposed.
14. See JM to Jefferson. 22 Jan. 1786 (Papers of Madison description begins William T. Hutchinson et al., eds., The Papers of James Madison (9 vols. to date; Chicago, 1962——). description ends , VIII, 472–81).
15. After the letter was returned many years later, JM interlined the full name, “Paradise.”
16. In code lution but corrected to we by Short.
17. JM’s code omitted “761,” tion, needed for the complete word.
18. JM’s code “1228.1142” read sectmitting.
19. JM’s code omitted “276,” ce, needed for the complete word.