To Rufus King
Department of State, Decr. 10th. 1801
Notice being just given me that the Mail to be made up this evening will reach New York in time for a British Packet, I avail myself of the opportunity to inclose a Newspaper containing all that is yet published of the proceedings of the present Session of Congress, together with the message of the President.1
The accounts of peace have, with some interested exceptions, given the most sincere pleasure throughout the United States. Its effects have not yet very fully unfolded themselves, but are appearing in the fall in prices of some of our productions, particularly flour and grain. It is thought probable however, that, as often happens, the first effect will in this case, exceed the more durable one. It is certain, that the quantity of these particular Articles promised to foreign markets by the exuberance of our summer harvests, will be materially abridged by the scanty crops of Indian corn, which in the middle and Southern States have failed more generally than has for many years happened. A Richmond paper, also inclosed, will give you an evidence of it in the price of that article in one of the States which depend most on it for daily food, and in which it is usually cheaper than in any State more to the North.
Among the effects of the peace, in this Country, none will be more important than the shock which will be felt by our navigation. Besides the loss of the extra carrying trade derived from the war, the countervailing Act of Great Britain founded on the Treaty of 1794, must inevitably banish American vessels from all share in the direct trade with any part of the British Dominions, as fast as British vessels can enter into competition. I have already heard of one instance, in which an American owner of 8 or 10 ships, has chartered a British ship for a cargo of cotton, as preferable to the use of his own. Instances, I am told, have occurred, even during the War, in which merchants inattentive to the British statute, or ignorant of it, have found to their regret, that by shipping tobacco in American bottoms, when British bottoms could have been had, they were considerably losers by it.
This subject can scarcely fail to produce much sensation in some classes of our citizens. Three remedies occur for consideration. The first is that of imposing light duties on foreign vessels. This may fairly be done; but if carried to an Amount materially relieving our navigation, would probably be construed into an indirect violation of the compact. The second remedy might be, to repeal here the discrimination between American and foreign ships with respect to the impost on their cargoes; and to call on Great Britain to repeal her countervailing law. An objection to this expedient is, that it would either give an unnecessary advantage to other foreign nations, or involve disputes or complaints from them. Another difficulty is, that before these concurrent repeals could be brought about, a great part of the evil will have taken place. The third remedy is that of an immediate amendment of the British Act, adjusting the countervailing duties to a real equality with those of the U. States. This, it is conceived may be justly claimed, on the ground that the known object, the true spirit, and the obvious import of the terms of the Treaty, require that the relative advantages and disadvantages of the vessels of the two countries in the trade between them should become such, as to put them on a fair equality. Before the treaty took place it was complained by Great Britain that her vessels were placed under an inequality and disadvantage by the difference of tonnage duty, and a difference of one tenth in the impost on merchandize laid by the U States in favor of their own vessels. In the Treaty the U. States agreed that Great Britain might countervail these differences, in other words, might lay an equal tonnage duty on American vessels, and a duty on their cargoes equivalent to the additional duty laid in the U States on the cargoes of British vessels. By calculating this additional duty of 10 Cent, not according to its real or estimated amount in the U. States, but according to British rates, which are more than ten times as high, and in many Articles near ten times ten, every idea of equalization is abandoned and the alledged difference in favor of one side, which was to be remedied by the Treaty, is by the construction of the Treaty made infinitely greater in favour of the other side. No sound rules of interpretation can authorize such a consequence; nor, I will add, can any wise policy adhere to it.
What course may be preferred by Congress on this occasion is not known. It is not improbable, that one or other of the expedients within their powers may be taken into consideration. The expedient which belongs to the Executive Department, may in the mean time be a subject of negotiation, and being the most eligible, will, if likely to succeed preclude a resort to any other. It is accordingly the wish of the President that no time may be lost in stating to the British Government the light in which their countervailing Act is received here, and in endeavouring to obtain an accommodation of it to some rule that will produce a real equality to the navigation of the two countries, as intended by the parties, instead of that ruinous inequality to the navigation of one of them which must result from the rule adopted.
This subject would have been committed to your attention at an earlier day; but it was thought best to await the conclusion of others depending with the British Government. The sudden and unexpected peace which has taken place, varies the case, and calls for an immediate interposition in behalf of our citizens.
France also has a discrimination in force which must exclude American vessels from any share in the carriage of the important article of tobacco to her ports. But as no stipulation can be pretended to restrain us from countervailing the inequality, the remedy is in our own hands, if she should not see the propriety of applying it herself.
The ratification of the Convention by the French Government having a declaratory clause inserted in it, the President thought proper that the instrument should not be proclaimed as a law, until the Senate should see and sanction it with that ingredient. There is no reason to suppose that any further delay will be occasioned by this course than what belongs to the usual forms of proceedings. With the highest respect & consideration I remain Sir Your Most Obedt. hle st