inclination of all, the more so from memory of England's accursed
navigation acts, would have been to leave it untrammelled. Several
motives, however, induced resort to a restrictive policy which,
beginning with 1789, and for years expected to be temporary, has been
pursued with little deviation ever since. Of course the Government
needed revenue, and the readiest means of securing this was a tax on
imports. Rates were made low, averaging until 1808 only 11-1/4 per cent.
As a consequence the revenues were large.
The movers of this first tariff, especially Hamilton, also wished by
means of it to make the central Government felt as a positive power
throughout the land. It had this effect. All custom-houses passed to the
United States, and United States officers appeared at every port, having
an authority, in its kind, paramount to that of state functionaries.
A stronger consideration still was to retaliate against England. In
spite of America's political independence the old country was determined
to retain for her merchant marine its former monopoly here. Orders in
council practically limited all the commerce of England and her
remaining colonies with this country to English ships, although, from
the relations of the two lands and the nature of their productions, our
chief foreign trade must still be with England. There was no way to meet
this selfish policy but to show that it was a game which we too could
play.
Besides, however we behaved toward the mother-land, we needed to be
prepared for war, because it was evident that George III. and his
ministers had only too good a will to reduce us again to subjection if
opportunity offered. Should we, by taxing imports, become independent in
the production of war material, a fresh struggle for life would be much
more hopeful than if we continued dependent upon foreign lands for
military supplies.
II. Funding the Debt.--In the first years after they had set up their
new constitution the people of this country staggered under a terrible
financial load. Besides the current expenses of Government, there were:
1, the federal debt due abroad, over thirteen million dollars, including
arrears; 2, the federal debt held at home, about forty-two and one-half
million; 3, the state revolutionary debts, aggregating nearly
twenty-five million. Each of these sums was largely made up of unpaid
interest.
The foreign debt Congress unanimously determined to pay in full. In
respect to the domestic federal debt two opinions prevailed. Hamilton
was for liquidating this also to the last copper. But these securities
had mostly changed hands since issue, so that dollar for dollar payment
would not advantage original holders but only speculators. As soon as
Hamilton's recommendation became public this class of paper rose from
about fifteen cents per dollar to fifty cents, and enterprising New York
firms hurried their couriers, relay horses, and swift packets to remote
parts of the Union to buy it up. Madison, supported by a strong party,
proposed, therefore, to pay only original debtors at par, allowing
secondary holders barely the highest market value previous to the
opening of the question in Congress. He was overruled, however, and this
part of the debt, too, was ordered paid according to its literal terms.
Even the motion that the United States should assume and discharge the
state debts finally prevailed, though against most violent and resolute
opposition. This came especially from Virginia, who had gone far in the
payment of her own war debt, and thought it unjust to have to help the
delinquent States. Her objection was strengthened by the fact that most
of the debt was owned in the North. The victory was secured by what is
now termed a "deal," northern votes being promised in favor of a
southern location for the national capital, in return for enough
southern votes to pass the bill assuming state debts.
These gigantic measures had origin in the mind of Hamilton. To many they
appeared and appear today like a grand government job. But they worked
well, laying the foundation of our national credit. Interest arrears and
back installments of the foreign debt were to be paid at once with the
proceeds of a fresh loan, supplemented by income from customs and
tonnage. The remaining debt was to be refunded. Federal stocks shot up
in value, moneyed interests became attached to the Government, and the
nation began to be looked to as a more reliable bulwark of sound finance
than any of the States.
Alexander Hamilton.
From a painting by John Trumbull in the Trumbull Gallery at Yale College.
III. The Excise.--Unexpectedly productive as the tariff had proved,
public income still fell short of what these vast operations required.
Direct taxation or a higher tariff being out of the question, Hamilton
proposed, and Congress voted, an excise on spirits, from nine to
twenty-five cents a gallon if from grain, from eleven to thirty if from
imported material, as molasses. Excise was a hated form of tax, and this
measure awakened great opposition in Maryland, Virginia, North Carolina,
and New England, and most of all in Pennsylvania, in whose western
counties distilling was the staple industry.
Here, far from the seats of power, even the state government had
asserted itself little. The general Government was defied. A meeting in
Washington County voted to regard as an enemy any person taking office
under the excise law. September 6, 1791, a revenue officer was tarred
and feathered. Other such cases followed. Secret societies were formed
to oppose the law. Whippings and even murders resulted. At last there
was a veritable reign of terror. The President proceeded slowly but with
firmness, accounting this a good opportunity vividly to reveal to the
people the might of the new Government. Militia and volunteers were
called out, who arrived in the rebellious districts in November, 1794.
Happily, their presence sufficed. The opposition faded away before them,
not a shot being fired on either side.
Illicit Distillers warned of the Approach of Revenue Officers.
IV. The Bank.--The Secretary of the Treasury pleaded for a United States
Bank as not only profitable to Government but indispensable to the
proper administration of the national finances. Congress acquiesced, yet
with so violent hostility on the part of many that before approving the
Charter Act Washington required the written opinions of his official
advisers. Jefferson powerfully opposed such an institution as
unconstitutional, his acute argument being the arsenal whence close
constructionists have gotten their weapons ever since. Randolph sided
with Jefferson, Knox with Hamilton. The President at last signed,
agreeing with Hamilton in the view that Congress, being the agent of a
sovereignty, is not, within any sphere of action constitutionally open
to it, shut up to specific or enumerated modes of attaining its ends,
but has choice among all those that nations customarily use. The Supreme
Court has proceeded on this doctrine ever since. The bank proved vastly
advantageous. Three-fourths of every private subscription to its stock
had to be in government paper, which raised this to par, while it
naturally became the interest of all stockholders to maintain and
increase the stability and credit of the Government.
CHAPTER IV.
RELATIONS WITH ENGLAND
[1793]
In 1789 France adopted a constitution. Provoked at this, the friends of
absolute monarchy withdrew from France, and incited the other powers of
Europe to interpose in effort to restore to Louis XVI. his lost power.
The result was that Louis lost his head as well as his power, and that
France became a republic. War with all Europe followed, which elevated
that matchless military genius, Napoleon Bonaparte, first to the head of
France's armies, then to her throne, to be toppled thence in 1814,
partly by his own indiscretions, partly by the forces combined against
him.
From the beginning to the end of this revolutionary period abroad,
European politics determined American politics, home as well as foreign,
causing dangerous embarrassment and complications. War having in
February, 1793, been declared by England and France against each other,
what attitude the United States should assume toward each became a
pressing question. Washington's proclamation of neutrality, April 22,
1793, in effect, though not so meant, annulled our treaty of 1778 with
France, which bound us to certain armed services to that monarchy in
case of a rupture between her and England. Washington's paper alleged
that "the duty and interests of the United States" required
impartiality, and assumed "to declare the disposition of the United
States to observe" this.
"The proclamation," wrote Jefferson, "was in truth a most unfortunate
error. It wounds the popular feelings by a seeming indifference to the
cause of liberty. And it seems to violate the form and spirit of the
Constitution by making the executive magistrate the organ of the
'disposition' 'the duty' and 'the interest' of the nation in relation to
war and peace--subjects appropriated to other departments of the
Government."
"On one side," says Mr. Rives, in his "Life of Madison," "the people saw
a power which had but lately carried war and desolation, fire and sword,
through their own country, and, since the peace, had not ceased to act
toward them in the old spirit of unkindness, jealousy, arrogance, and
injustice; on the other an ally who had rendered them the most generous
assistance in war, had evinced the most cordial dispositions for a
liberal and mutually beneficial intercourse in peace, and was now set
upon by an unholy league of the monarchical powers of Europe, to
overwhelm and destroy her, for her desire to establish institutions
congenial to those of America."
The more sagacious opponents of the administration believed true policy
as well as true honesty to demand rigid and pronounced adherence to the
letter of the French treaty. They were convinced from the outset that
France would vanquish her enemies, and that close alliance with her was
the sure and the only sure way to coerce either Great Britain to justice
or Spain to a reasonable attitude touching the navigation of the
Mississippi; while by offending France, they argued, we should be forced
to wrestle single-handed with England first, then with victorious
France, meantime securing no concession whatever from Spain.
This was a shrewd forecast of the actual event. The Federalists,
destitute of idealism, proved to have been overawed by the prestige of
England and to have underestimated the might which freedom would impart
to the French people. After Napoleon's great campaign of 1796-97, Pitt
seeks peace, which the French Directory feels able to decline. In 1802
the Peace of Amiens is actually concluded, upon terms dictated by
France. Had we been still in France's friendship, the two republics
might have compelled England's abandonment of that course which evoked
the war of 1812. As it was, ignored by England, to whom, as detailed
below, we cringed in consenting to Jay's treaty, we were left to
encounter the French navy alone, escaping open and serious war with
France only by a readiness to negotiate which all but compromised our
dignity. The Mississippi we had at last to open with money.
The federalist leaning toward Great Britain probably did not, to so
great an extent as was then alleged and widely believed, spring from
monarchical feeling. It was due rather to old memories, as pleasant as
they were tenacious, that would not be dissociated from England; to the
individualistic tendencies of republicanism, alarming to many; and to
conservative habits of political thinking, the dread of innovation and
of theory. The returned Tories had indeed all become Federalists, which
fact, with many others, lent to this attitude the appearance of
deficient patriotism, of sycophancy toward our old foe and persecutor.
Great Britain had refused to surrender the western posts according to
the peace treaty of 1783, unjustly pleading in excuse the treatment of
loyalists by our States. Not only the presence but the active influence
of the garrisons at these posts encouraged Indian hostilities. England
had also seized French goods in American (neutral) vessels, though in
passage to the United States, and treated as belligerent all American
ships plying between France and her West Indian colonies, on the ground
that this commerce had been opened to them only by the pressure of war.
The English naval officers were instructed to regard bread-stuffs as
contraband if bound for France, even though owned by neutrals and in
neutral ships; such cargoes, however, to be paid for by England, or
released on bonds being given to land them elsewhere than in France. In
this practice England followed France's example, except that she
actually paid for the cargoes, while France only promised.
John Jay.
From a painting by S. F. B. Morse in the Yale College Collection.
[1795]
Worst of all, Britain claimed and acted upon the right to press into her
naval service British-born seamen found anywhere outside the territory
of a foreign State, halting our ships on the high seas for this purpose,
often leaving them half-manned, and sometimes recklessly and cruelly
impressing native-born Americans--an outrageous policy which ended in
the war of 1812. The ignorance and injustice of the English admiralty
courts aggravated most of these abuses.
Genet's proceedings, spoken of in the next chapter, which partly public
sentiment, partly lack of army and navy, made it impossible for our
Government to prevent, enraged Great Britain to the verge of war. After
the British orders in council of November 6, 1793, intended to destroy
all neutral commerce with the French colonies, and Congress's
counter-stroke of an embargo the following March, war was positively
imminent. The President resolved to send Jay to England as envoy
extraordinary, to make one more effort for an understanding.
The treaty negotiated by this gentleman, and ratified June 24, 1795
(excepting Article XII., on the French West India trade), was doubtless
the most favorable that could have been secured under the circumstances;
yet it satisfied no one and was humiliating in the extreme. The western
posts were indeed to be vacated by June 1, 1796, though without
indemnity for the past, but a British right of search and impressment
was implicitly recognized, the French West Indian trade not rendered
secure, and arbitrary liberty accorded to Great Britain in defining
contraband. Opposition to ratification was bitter and nearly universal.
The friends of France were jubilant. Jay was burned in effigy,
Washington himself attacked. The utmost that Hamilton in his powerful
"Letters of Camillus" could show was that the treaty seemed preferable
to war. Plainly we had then little to hope and much to fear from war
with Great Britain, yet even vast numbers of Federalists denounced the
pact as a base surrender to the nation's ancient tyrant, and wished an
appeal to arms.
Fisher Ames's eloquence decided the House for the treaty. An invalid,
with but a span of life before him, he spoke as from the tomb. "There
is, I believe," so ran his peroration, "no member who will not think his
chance to be a witness of the consequences (should the treaty fail of
ratification) greater than mine. If, however, the vote should pass to
reject, and a spirit should rise, as it will, with the public disorders,
to make confusion worse confounded, even I, slender and almost broken as
my hold on life is, may outlive the Government and Constitution of my
country!"
It was the most delicate crisis of Washington's presidency, and no
other American then alive, being in his place, could have passed through
it successfully. After the fury gradually subsided, men for a long time
acquiesced rather than believed in the step which had been taken. In the
end the treaty proved solidly advantageous, rather through
circumstances, however, than by its intrinsic excellence.
CHAPTER V.
RELATIONS WITH THE FRENCH REPUBLIC
[1793]
At its beginning all Americans hailed the Revolution in France with
joy, but its terrible excesses, when they appeared, produced here the
same effect as in England, of alienating everyone conservatively
inclined. This included the mass of the Federalist party. On the
contrary, most of the Republicans, now more numerous, now less,
actuated partly by true insight into the struggle, and partly by the
magic of the words "revolution" and "republic," favored the
revolutionists with a devotion which even the Reign of Terror in France
scarcely shook. It was in consequence of this attitude on its part that
the party came to be dubbed "democratic-republican" instead of
"republican," the compound title itself giving way after about 1810 to
simple "democratic."
John Adams
From a copy by Jane Stuart, about 1874, of a painting by her father,
Gilbert Stuart, about 1800--in possession of Henry Adams.
Hostility to England, the memory of France's aid to us in our hour of
need, the doctrine of "the rights of man," then so much in vogue, the
known sympathies of Jefferson and Madison, who were already popular,
and, alas, a mean wish to hamper the administration, all helped to swell
the ranks of those who swung their hats for France. A far deeper motive
with the more thoughtful was the belief that neutrality violated our
treaty of 1778 with France, a conclusion at present beyond question.
Politically our policy may have been wise, morally it was wrong.
The administration, at least its honored head, was doubtless innocent of
any intentional injustice; and it could certainly urge a great deal in
justification of its course. The form and the aims of the French
Government had changed since the treaty originated, involving a state of
things which that instrument had not contemplated. France herself
defied international law and compact, revolutionizing and incorporating
Holland and Geneva, and assaulting our commerce. And war with England
then threatened our ruin. Yet the pleading of these considerations in
that so trying hour, even had they been wholly pertinent, could not but
seem to Frenchmen treason to the cause of liberty. As to many
Federalists, trucklers to England, such a charge would have been true.