 Chapter 1 of Washington and his colleagues. This is a LibriVox recording. All LibriVox recordings are in the public domain. For more information or to volunteer, please visit LibriVox.org. Washington and his colleagues by Henry Jones Ford. Chapter 1, An Imitation Court. Washington was glad to remain at Mount Vernon as long as possible after he had consented to serve as president, enjoying the life of a country gentleman, which was now much more suited to his taste than official employment. He was weary of public duties and the heavy demands upon his time, which had left him with little leisure for his private life at home. His correspondence during this period gives ample evidence of his extreme reluctance to re-assume public responsibilities. To bring the matter to its true proportions, it must be remembered that to the view of the times the new constitution was but the latest attempt to tinker the federal scheme, and it was yet to be seen whether this endeavor would be any more successful than previous efforts had been. As for the title of president, it had already been borne by a number of congressional politicians and had been rather tarnished by the behavior of some of them. Washington was not at all eager to move in the matter before he had to, and he therefore remained on his farm until Congress met formally declared the result of the election and sent a committee to Mount Vernon to give him official notice. It was not until April 30, 1789 that he was formally installed as president. Medicine and Hamilton were meanwhile going ahead with their plans. This time was perhaps the happiest in their lives. We stood together in years of struggle to start the movement for a new constitution to steer it through the convention and to force it on the states. Although the fight had been a long and a hard one, and although they had not won all that they had wanted, it was nevertheless a great satisfaction that they had accomplished so much. They were now applying themselves with great zest to the organization of the new government. Madison was a member of Congress. Hamilton lived near the place where Congress held its sittings in New York, and his house was a rendezvous for the federal leaders. Whether Madison would often go to talk over plans and prospects, a lady who lived nearby has related how she often saw them walking and talking together, stopping sometimes to have fun without monkey skipping about in that neighbor's yard. By the time Madison was 38, Hamilton was 32. They were little men of the quick dapper type. Madison was five feet six and a quarter inches tall, slim and delicate and physique. With a pale student's face lit up by bright hazel eyes. He was as plain as a Quaker in his style of dress and his hair which was lighting color was brushed straight back and gathered into a small queue tied with a plain ribbon. He was of about the same stature but his figure had wiry strength. His Scottish ancestry was manifest in his ruddy complexion and in the modeling of his features. He was more elegant than Madison and his habitual attire. He had a very erect dignified bearing. His expression was rather severe when his features were in repose. But he had a smile of flashing radiance when he was pleased and interested. Washington, who stood over six feet two inches in his buckle shoes, had to look down over his nose when he met the young statesman who had been the wheel horses of the federal movement. After Washington arrived in New York, he sought Hamilton's aid in the management of the national finances. There was the rock on which the government of the confederation had founded. There the most skillful pilotage was required if the new government was to make a safe voyage. Washington's first thought had been to get Robert Morris to take charge again of the department that he had formally managed with conspicuous ability. And while stopping in Philadelphia on his way to New York, he had approached Morris on the subject Morris who was now engaged in grand projects which were eventually to bring him to a debtors prison declined the position but strongly recommended Hamilton. This suggestion proved very acceptable to Washington, who was well aware of Hamilton's capacity. The thorny question of etiquette was the next matter to receive Washington's attention. Personally, he favored the easy hospitality to which he was accustomed in Virginia, but he knew quite well that his own taste ought not to be decisive. The forms that he might adopt would become precedence and hence action should be taken cautiously. Washington was a methodical man. He had a well balanced nature, which was never disturbed by timidity of any kind, and rarely by anxiety. His anger was strong when it was excited, but his ordinary disposition was one of massive equanimity. He was not imaginative, but he took things as they came and did what the occasion demanded in crises that did not admit of deliberation. His instinctive courage guided his behavior, but such crises belong to military experience and in civil life, careful deliberation was his rule. It was his practice to read important documents, pen in hand to note the points from one of his familiar letters to General Knox. We learned that on rising in the morning he would turn over in his mind the day's work and would consider how to deal with it. His new circumstances soon apprised him that the first thing to be settled was his department as president. Under any form of government, the man who is head of the state is forced as part of his public service to submit to public exhibition and to be exact in social observance, but unless precautions are taken, engagements will consume his time and strength. Writing to a friend about the situation in which he found himself Washington declared by the time I had done breakfast and then still dinner and afterwards till bedtime, I could not get relieved from the ceremony of one visit before I had to attend to another. In a word, I had no leisure to read or answer the dispatchers that were pouring in upon me from all quarters. The radical treatment which the situation called for was aided by a general feeling in Congress that arrangements should be made for the president, different from those under the Articles of Confederation. It had been the practice for the president to keep open house of this custom Washington remark that it brought the office in perfect contempt for the table was considered a public one, and every person who could get introduced can see that he had a right to be invited to it. This, although the table was always crowded and with mixed company and the president considered in no better light than as a maitre d'hautel was in its nature impracticable and as many offenses given as if no table had been kept. It was important to settle the matter before Mrs. Washington joined him in New York inside of 10 days from the time he took the oath of office. He therefore drafted a set of nine queries, copies of which he sent to Jay, Madison, Hamilton, and John Adams with these sensible remarks. Many things which appear of little importance in themselves and at the beginning may have great and durable consequences from there having been established at the commencement of a new general government. It will be much easier to commence the administration upon a well adjusted system built on tenable grounds than to correct errors or alter inconveniences after they shall have been confirmed by habit. The president in all matters of business and etiquette can have no object but to demean himself in his public character in such a manner as to maintain the dignity of his office without subjecting himself to the imputation of superciliousness or unnecessary reserve. Under these impressions, he asked for your candid and undisguised opinion. Only the replies of Hamilton and Adams have been preserved. Hamilton advised Washington that while the dignity of the office should be supported, care will be necessary to avoid extensive disgust or discontent. The notions of equality are yet, in my opinion, too general and strong to admit of such a distance being placed between the president and other branches of the government as might even be consistent with a due proportion. Hamilton then sketched a plan for a weekly levy. The president to accept no invitations and to give formal entertainments only twice or four times a year, the anniversaries of important events of the revolution. In addition, the president on levy days either by himself or some gentleman of his household to give informal invitations to family dinners, not more than six or eight to be invited at a time and the matter to be confined essentially to members of the legislature and other official characters. Hamilton never to remain long at table. Hamilton observed that his views did not correspond with those of other advisors but he urged the necessity of behaving so as to remove the idea of two immense inequality which appear would excite dissatisfaction and this was sagacious advice and Washington would have benefited by conforming to it more closely than he did the prevailing tenor of the advice which he received is probably reflected in the communication from Adams, who was in favor of making the government impressive through grand ceremonial chamberlains, aids to camps, secretaries, masters of ceremonies, etc. will become necessary. Neither dignity nor authority can be supported in human minds collected into nations or any great numbers without a spender and majesty in some degree proportion to them. Adams held that in no case would it be proper for the president to make any formal public entertainment, but that this should be the function of some minister of state, although upon such occasions, the president in his private character might honor with his presence. The president might invite to his house and small parties, what official characters or citizens of distinction he pleased, but this invitation should always be given without formality. The president should hold levies to receive visits of compliment and two days a week might not be too many for this purpose. The idea running through Adams's advice was that in his private character, the president might live like any other private gentleman of means, but that in his public functions he should adopt a grand style. This advice which Washington undoubtedly received from others as well as Adams influenced Washington's behavior and the consequences were exactly what Hamilton had predicted. According to Jefferson's recollection many years afterward, Washington told him that General Knox and Colonel Humphries drew up the regulations and that some were proposed so highly strained that he absolutely rejected them. Jefferson further related that when Washington was re-elected, Hamilton took the position that the parade of the previous inauguration ought not to be repeated, remarking that there was too much ceremony for the character of our government. It is a well-known characteristic of human nature to be touchy about such matters as these popular feeling about Washington's procedure was inflamed by reports of the grand titles which Congress was arranging to bestow upon the president. That matter was in fact considered by the Senate on the very day of Washington's arrival in New York and before any steps could have been taken to ascertain his views. A joint committee of the two houses reported against annexing any style or title to the respective styles or titles of office expressed in the Constitution. But a group of senators headed by John Adams was unwilling to let the matter drop and another Senate committee was appointed which recommended as a proper style of address is heinous the president of the United States of America and protector of their liberties. While the Senate debated the House acted addressing the president in reply to his inaugural address simply as the president of the United States. The Senate now had practically no choice but to drop the matter, but in so doing adopted a resolution that because of its desire that a due respect for the majesty of the people of the United States may not be hazarded by singularity. The Senate was still of the opinion that it would be proper to annex a respectable title to the office. Thus it came about that the president of the United States is distinguished by having no title. A governor may be addressed as your excellency, a judge as your honor, but the chief magistrate of that nation is simply Mr. President. It was a relief to Washington when the Senate discontinued its attempt to decorate him. He wrote to a friend, happily this matter is now done with. I hope never to be revived. Details of the social entanglements in which Washington was caught at the outset of his administration are generally omitted by serious historians. But whatever illustrates life and manners is not insignificant and events of this character had more over a distinct bearing on the politics of the times. The facts indicate that Washington's arrangements were somewhat encumbered by the civic ambition of New York. That busting town of 30,000 population desired to be the capital of the nation and in the splendid exertions which it made it went rather too far. Federal Hall, designed as a city hall was built in part for the accommodation of Congress on the site in Wall Street now in part occupied by the United States sub treasury. The plans were made by Major Pierre Charles long fall, a French engineer who had served with distinction in the Continental Army, but who's clear as title to fame is the work which he did in laying out the city of Washington when it was made the national capital. Federal Hall exceeded indignified proportions and an artistic design any public building then existing in America that painted ceilings the crimson damas canopies and hangings and the handsome furniture were considered by many political agitators to be a great violation of republican simplicity. The architect was first centered in the public press, and then because of disputes received no pay for his time and trouble, although had he accepted a grant of city lots offered by the town council, he would have received a compensation that would have turned out to be very valuable. Federal Hall had been completed and presented to Congress before Washington started for New York. The local arrangements for his reception were upon a corresponding scale of magnificence, but with these Washington had had nothing to do. The barge in which he was conveyed from the Jersey Shore to New York was 50 feet long, hung with red curtains and having an awning of Saturn. It was rode by 13 oarsmen in white with blue ribbons. In the inauguration ceremonies, Washington's coach was drawn by four horses with gay trappings of hoofs, blackened and polished. This became his usual style. He seldom walked in the street, for he was so much a public show that that might have been attended by annoying practical inconvenience. But when he rode out with Mrs. Washington, his carriage was drawn by four, sometimes six horses with two outriders in livery with powdered hair and cockades in their hats. When he rode on horseback, which he often did for exercise, he was attended by outriders and accompanied by one or more of the gentlemen of his household. Toward the end of the year, there arrived from England, the state coach, which he used in formal visits to Congress and for other ceremonious events. It was a canary colored cherry decorated with gilded nymphs and cupids and emblazoned with the Washington arms. His state was simplified when he went to church, which he did regularly every Sunday. Then his coach was drawn by two horses with two footmen behind and was followed by a post chase, carrying two gentlemen of his household. Washington was fond of horses and was in the habit of keeping a fine stable. The term muslin horses was commonly used to denote the care taken in grooming. The headroom would test the work of the stable boys by applying a clean muslin handkerchief to the coats of the animals. And if any stain of dirt showed there was trouble. The night before the white horses, which Washington used as president, were to be taken out, their coats were covered by a paste of whiting and the animals were swathed in wrappings. In the morning the paste was dry and with rubbing gave up marble gloss to the horses coats. The hooves were then blackened and polished and even the animals teeth were scoured. Such arrangements, however, were not peculiar to Washington's stable. This was the usual way in which grooming for the quality was done in that period. The first house occupied by Washington was at the corner of Pearl and Cherry Street, then a fashionable locality where the New York end of the Brooklyn bridge has left of it is now known as Franklin Square. The house was so small that three of his secretaries had to lodge in one room and Custis in his recollections tells how one of them who fancied he could write poetry would sometimes disturb the others by walking the floor in his night down trying the rhythm of his lines by rehearsing them with loud emphasis. About a year later, Washington removed to a larger house on the west side of Broadway near Bowling Green. Both buildings went down at an early date before the continual march of improvement in New York. In Washington's time, Wall Street was superseding Pearl Street as the principal haunt of fashion. Here lived Alexander Hamilton and other New Yorkers prominent in their day. Here were fashionable boarding houses at which lived the leading members of Congress. When some fashionable reception was taking place, the street was gay with coaches and sedan chairs and the entire of the people who then gathered was as brilliant as a flight of cockatoos. It was a period of spectacular dress and behavior for both men and women, the men rivaling the women in their use of lace silk and satin. Dr. John Bard the fashionable doctor of his day who attended Washington through the severe illness which laid him up for six weeks early in his administration. In Washington, habitually wore a cocked hat and a scarlet coat, his hands resting upon a massive cane as he drove about in a pony baitin. The scarlet waistcoat with large bright buttons which Jefferson wore on fine occasions when he arrived on the scene showed that he was not been averse to gay Raymond. Plain styles of dress were among the many social changes ushered in by the French Revolution and the war cycle that ensued from it. Titles figured considerably in colonial society and the Revolutionary War did not destroy the continuity of usage. It was quite in accord with the fashion of the times that the courtesy title of Lady Washington was commonly employed in talk about the president's household. Mrs. Washington arrived in New York from Mount Vernon on May 27, 1789. She was met by the president with his barge on the Jersey shore and as the barge passed the battery, a salute of 13 cannon was fired. At the landing place, a large company was gathered and the coach that took her to her home was escorted with military parade. The questions of etiquette had been settled by that time and she performed her social duties with the ease of a Virginia gentlewoman always used to good society. She found an irksome, however, as such things had long since lost their novelty. Writing to her friend, she said, I think I am more like a state prisoner than anything else. She was then a grandmother through her children by her first husband, although she preferred plain attire. She is described on one occasion as wearing a velvet gown over a white satin petticoat. Her hair smoothed back over a moderately high cushion. It was the fashion of the times for the ladies to tempt their hair up to a great height. At one of Mrs. Washington's receptions, Miss McIvers on New York Bell had such a towering coiffure that the feathers which surmounted had brushed a lighted chandelier and caught fire. The consequences might have been serious had the fire spread through the poem of tomb structure below, but one of the president's aides sprang to the rescue and smothered the burning plumes between the palms of his hands before any harm came to the young lady. Every Tuesday, while Congress was in session, Washington received visitors from three to four o'clock. These receptions were known as his levies. He is described as clad in black velvet. His hair was powdered and gathered behind in a silk bag. He wore knee and shoe buckles and yellow gloves. He held a cocked hat with a cockade and a black feather edging, and he carried a long sword in a scabbard of white polished leather. As visitors were presented to him by an aide, Washington made a bow to a candid friend who reported to him that his bows were considered to be too stiff. He replied, would it not have been better to throw the veil of charity over them ascribing their stiffness to the effects of age or to the unskillfulness of my teacher rather than to pride and dignity of office, which God knows has no charm for me. Washington bore with remarkable humility the criticisms of his manners that occasionally reached him. On Friday evenings, Mrs. Washington received and these affairs were known as her drawing rooms. They were over by nine o'clock, which was bedtime in the Washington household, but Washington was an early riser, often getting up at four in the morning to start today's work at times. The drawing rooms were more cheery affairs than the levies, as Mrs. Washington had simple and effective manners, and the general had made it known that on these occasions he desired to be regarded not as the president, but simply as a private gentleman. This gave him an opportunity such as he did not have at the levies to unbend and to enjoy himself. Besides these receptions, a series of formal dinners was given to diplomatic representatives, high officers of government and members of Congress. Senator McClay of Pennsylvania recorded in the diary he kept during the first Congress that Washington would drink wine with everyone in the company addressing each intern by name. McClay thought it was sufficient interest to record that on one occasion a trifle was served which had been made with rancid cream. All the ladies watched to see what Mrs. Washington would do with her portion, and next day there were tittering remarks all through the fashionable part of the town over the fact that she had martyred herself and swallowed the dose. Incidentally, McClay, who was in nearly everything of the opponent of the policy of the administration, bore witness to Washington's perfect courtesy. McClay noted that in spite of his antagonistic attitude, Washington invited him to dinner and paid him marked attention, although he knows enough to satisfy him that I will not be senator after the 3rd of March, and to the score of his good nature must I place these attentions. In his relations with Congress, Washington followed presidents derived from the English constitutional system under which he had been educated. No question was raised by anybody at first as to the propriety of a course with which the public men of the day were familiar. He opened the session with an address to Congress couched somewhat in the style of the speech from the throne. At the first session, there was talk of providing some sort of throne for him, but the proposal came to nothing. He spoke from the vice president's chair and the representatives went into the Senate chamber to hear him as the commons proceed to the House of Lords on such occasions. Congress too conformed to English presidents by voting addresses in reply, and then the members repaired to the president's audience chamber where the presiding officers of the two houses delivered their addresses and received the president's acknowledgments. These were disagreeable duties for Washington, although he discharged them conscientiously. McClay has recorded in his diary the fact that when Washington made his first address to Congress, he was agitated and embarrassed more than ever. He was by the level cannon or appointed musket. It was not until June 8 of Washington several these delicate affairs of official etiquette sufficiently to enable him to attend to details of administration. The government, although bankrupt, was in active operation and several executive departments were under secretaries appointed by the old Congress. The distinguished New York jurist John Jay, now 44 years old, had been secretary of foreign affairs since 1784. He had long possessed Washington's confidence and now attained his secretary's ship until the government was organized, whereupon he left that post to become the first chief justice of the United States. Henry Knox of Massachusetts, age 39, had been secretary of war since 1785, a position to which Washington helped him. They were old friends for Knox had served through the war with Washington and special charge of artillery. The postmaster general Ebenezer hazard was not in Washington's favor. While the struggle over the adoption of the Constitution was going on hazard put a stop to the customary practice by which newspaper publishers were allowed to exchange copies by mail. Washington wrote an indignant letter to John Jay about this action, which was doing mischief by inducing a belief that the suppression of intelligence at that critical juncture was a wicked trick of policy contrived by an aristocratic junta. As soon as Washington to move in the matter hazard was superseded by Samuel Osgood who as a member of the old Congress has served on a committee to examine the post office accounts. There was no secretary of the Treasury at that time, but the affairs of that department were in the hands of a board of commissioners. This same Samuel Osgood together with Walter Livingston and Arthur Lee to all these officials Washington now applied for a written account of the real situation of their departments. Several months elapsed before he was in a position to make new arrangements. The salary bill was approved September 2, 1789. And on the same day Washington commissioned Hamilton as secretary of the Treasury, the first of the new appointments, although in the creative enactments the Treasury Department came last. Next came Henry Knox, Secretary of War and of the Navy on September 12 Thomas Jefferson, Secretary of State and Edmund Randolph, Attorney General on September 26 on which date Osgood was also appointed. What may be said to be Washington's cabinet was thus established, but the term itself did not come into use until 1793. At the outset no more was decided than that the new government should have executive departments and in superficial appearance these were much like those of the old government. The Constitution made no distinct provision for our cabinet and the only clause referring to the subject is the provision authorizing the president to require the opinion and writing of the principal officer and each of the executive departments upon any subject relating to the duties of their respective offices. This provision does not contemplate a body that should be consultative by its normal character. The prevailing opinion at the time the Constitution was framed was that the consultative function would be exercised by the Senate which together with the president would form the administration. Upon this ground Mason of Virginia refused to sign the report of the Constitutional Convention it was owing to practical experience and not to the language of the Constitution that the president was soon repelled from using the Senate as his deputy counsel and was thrown back upon the aid of the heads of the executive departments who were thus drawn close to him as his cabinet. For note in this formative process the postmaster general was left outside in Washington's time since his functions were purely about business nature not directly affected by the issues on which Washington desired advice the postmaster general did not become a member of the cabinet until 1829. The intro character of the cabinet for a considerable period explains what might otherwise seem to be an anomaly the delay of Jefferson in occupying his post. He did not arrive until March 21, 1790 when Washington had been in office nearly a year, but this situation occasion no remark the notion that the heads of the departments formed a cabinet taking office with the president and reflecting his personal choice as his advisors was not developed until long after Washington's administration, although the cabinet itself as a distinct feature of the system of government dates from his first term. The importance which the cabinet soon acquired is evidence that even under a written constitution institutions are more to circumstances than to intentions. The Constitution of the United States is no exception to the rule that the true Constitution of a country is the actual distribution of power written provisions being efficacious only in the way and to the extent that they affect such distribution in practice. Hence results may differ widely from the expectation with which those provisions are introduced. A constitution is essentially a growth and never merely contrivance. End of chapter one, chapter two of Washington and his colleagues by Henry Jones Ford. This LibriVox recording is in the public domain. Chapter two, great decisions while Washington was bearing with military forwarded to the rigors and annoyances of the imitation court in which he was confined. Congress reached decisions that had a vast effect in determining the actual character of the government. The first business in order of course was the raising of revenue for the Treasury was empty and payments of interest due on the French and Spanish loans were years behind. Congress and attack this problem before Washington arrived in New York to take the oath of office. On April 8 he introduced in the House a resolution which aimed only at giving immediate effect to a scheme of duties and imposts that have been approved generally by the states in 1783. On the very next day debate upon this resolution began in the committee of the whole for there was then no system standing committees to intervene between the House and its business. The debate soon broadened out far beyond the lines of the original scheme and in it the student finds lucidly presented the issues of public policy that have accompanied tariff debates ever since. Medicine laid down the general principle that commerce ought to be free and labor and industry left it large to find its proper object but suggest that it would be unwise to apply this principle without regard to particular circumstances. Although interest will in general operate effectually to produce political good yet there are causes in which certain factitious circumstances may divert it from its natural channel or throw or retain it in an artificial one. Congress now reads like prophecy he referred to cases where cities companies or opulent individuals engross the business from others for having had an uninterrupted possession of it or by the extent of their capitals being able to destroy a competition. The same situation could occur between nations and have to be considered. There was some truth. He also thought in the opinion that each nation should have within itself the means of defense independent of foreign supplies. But he considered that this argument had been urged beyond reason as there is good reason to believe that when it becomes necessary, we may obtain supplies abroad as readily as any other nation whatsoever. The instance as a cogent reason in favor of protective duties that as the states have formally the power of making regulations of trade to cherish their domestic interests. It must be presumed that when they put the exercise of this power into other hands by adopting the Constitution. They must have done this with the expectation that those interests would not be neglected by Congress actuated by suffused and doubtless also influenced by the great need for revenue. Madison was on the whole favorable to amendments extending the list of dutyable articles. So there were conflicts between members from manufacturing districts and those from agricultural constituencies and though the salt protectionists of New York had some difficulty in carrying their point. The contention did not follow sectional lines. Cole was added to the list on the motion of a member from Virginia. The duties levied were however very moderate, ranging from five to 12 and one half percent with an exception in the case of one article that might be considered a luxury. The bill as it passed the House discriminated in favor of nations with which the United States had commercial treaties. That is to say it favored France and Holland as against Great Britain, which had the bulk of America's foreign trade. Though Madison insisted on this provision and was supported by a large majority of the House, the Senate would not agree to it. During the early sessions of Congress, the Senate met behind closed doors of practice, which it did not abandon until five years later. From the accounts of the discussion preserved in McClay's diary, it appears that there was much wrangling. McClay relates that on one occasion when Pennsylvania's demands were sharply attacked, his colleague Robert Morris was so incensed that McClay could see his nostrils widened and his nose flattened like the head of a viper. Pierce Butler of South Carolina inflamed away and threatened a dissolution of the Union with regard to his state as sure as God was in the firmament. Thus began a line of argument that was frequently pursued thereafter until it was ended by wager of battle. On several occasions, the division was so close that Vice President Adams gave the casting vote. Although there was much wrangling in the Senate against imposts as a burden to the agricultural sections, yet some who opposed duties in the abstract thought of particulars that ought not to be neglected if the principle of protection were admitted. Duties on hemp and cotton therefore found their way into the bill through amendments voted by the Senate. Adjustment of the differences between the two houses was hindered by the resentment of the House at the removal of the 3D discrimination feature, but the Senate with characteristic address evaded the issue by promising to deal with it as a separate measure and ended by affording the House on that point. On the whole, in view of the sharp differences of opinion, the action taken on the tariff was remarkably expeditious. The bill which passed the House on May 16 was passed by the Senate on June 2, and although delay now ensued because of the conflict over the discrimination issue, the bill became law by the President's approval on July 4. This prompt conclusion in spite of closely balanced factions becomes more intelligible when it is observed that the rules of the Senate then provided that in case of debate becoming tedious for senators may call for the question. Brief as was the period of consideration as compared with the practice since that day, McClay noted indignantly that the merchants had already added the amount of the duties to the price of their goods so that a burden fell upon the consumers without advantage to the Treasury. Such consequences, evidence of defect and procedure, which the experience of other nations has led them to correct, but which has continued to increase in the United States until it has attained monstrous proportions. Under the English budget system, new imposts now take effect as soon as they are proposed by the government, the contingency of alteration in the course of enactment being provided for by return of payments made in error. The general tendency of civilized government is now strongly in favor of attaching the process of deliberation upon financial measures to the period of their administrative incubation and of shortening the period of formal legislative consideration. One of the tasks of Congress in its first session was to draft amendments to the Constitution. The reasons for such action were stated by Madison to be a desire to propitiate those who desired a bill of rights in an effort to secure acceptance of the Constitution in Rhode Island and North Carolina. Promises have been made in the course of the struggle for adoption that this matter would be taken up and there was a general willingness to proceed with it. Under the leadership of Madison, the House adopted 17 amendments, which were reduced by the Senate to 12 of these 10 were eventually ratified and formed what is commonly known as the Bill of Rights. Apart from this matter, the session which lasted until September 29 was almost wholly occupied with measures to organize the new government. To understand the significance of the action taken, it should be remembered that the passions excited by the struggle over the new Constitution were still turbulent. Fisher Ames of Massachusetts, a member without previous national experience, who watched the proceedings were keen observation, early noticed the presence of a group of objectors whose motives he regarded as partly factious and partly temperamental. Writing to a friend about the character of the House, he remarked three sorts of people are often troublesome, the anti-Federal's, who alone are weak and some of them well-disposed, the dupes of local prejudices who fear eastern influence, monopolies and navigation acts, and lastly, the violent Republicans as they think fit to style themselves who are new lights and politics who are more solicitous to establish or rather to expatiate upon some sounding principle of republicanism than to protect property, cement the union and perpetuate liberty. The spirit of opposition had from the first inexperienced leader, Adele Bridge Gary of Massachusetts, he had seen many years of service in the Continental Congress, which he first entered in 1776. He was a delegate to the Philadelphia Convention in whose sessions he showed a contentious temper and in the end refused to subscribe to the new Constitution. In the convention debates, he had strongly declared himself against letting the heads of the departments, particularly a finance, have anything to do with business connected with legislation. Defeated in the convention, Gary was now bent upon making his ideas prevail in the organization of the government. On May 19, the matter of the executive departments was brought up in committee of the whole by Birdie Knot of New Jersey. At this time it was the practice of Congress to take up matters first in committee of the whole, and after general conclusions have been reached to appoint a committee to prepare and bring in a bill, a warm discussion ensued on the question that the heads of the departments should be removable by the president, Gary, who did not take a prominent part in the debate, spoke with a mildness that was in marked contrast with the excitement shown by some of the speakers. He was in favor of supporting the president to the utmost and of making him as responsible as possible. Since Congress had obviously no right to confer a power not authorized by the Constitution, and since the Constitution had conditioned appointments on the consent of the Senate, it followed that removals must be subject to the same condition. He spoke briefly and only once, although the debate became long and impassioned, but he was merely reserving his fire as subsequent developments soon showed. Without a call for the eyes of nays, the question was decided in favor of declaring the power of removal to be in the president. The committee then proceeded to the consideration of the Treasury Department. Gary once made a plea for delay. He thought they were hurrying on business too rapidly. The gentleman had already committed themselves on one very important point. He knew nothing of the system which the gentleman proposed to adopt in arranging the Treasury Department, but the fact was worth considering that the late Congress had on long experience, thought proper to organize the Treasury Department in a mode different from that now proposed. He would be glad to know what the reasons were that would induce the committee to adopt a different system from that which had been found most beneficial to the United States. What Gary had in view was the tension of the then existing system of Treasury management by a board of commissioners in 1781, the Continental Congress have enforced to let the Treasury pass out of its own hands into those of our superintendent of finance through sheer inability to get any funds unless the change was made. Robert Morse who held the position had resigned in January 1783 because of the behavior of Congress, but the attitude of the army had become so menacing that he was implored to remain in office and attend to the arrears of military pay. He had managed to affect the settlement and at length retired from office on November 1 1784 Congress then put the Treasury in the hands of three commissioners appointed unsupervised by it. Gary was now striving to continue this arrangement with as little change as possible. When debate was resumed the next day Gary made a long smooth speech on the many superior advantages of the board system. The extent and variety of the functions of the office would be a trial to anyone man's integrity. Admit these innumerable opportunities for defrauding the revenue without check or control and it is next to impossible he should remain unsettled in reputation or inoxious with respect to misapplying his trust. The situation would be very disagreeable to the person appointed provided he is an honest upright man. It will be disagreeable also to the people of the union who will always have reason to suspect misconduct. We have had a Board of Treasury and we have had a finance here. I have not expressed charges as well as vague rumors been brought against him at the bar of the public. They may be unfounded is true but it shows that a man cannot serve in such a station without exciting popular climber. He is very well known I dare say to many gentlemen in this house that the noise and commotion were such as obliged Congress once more to alter their Treasury department and place it under the management of a Board of Commissioners. He discounted upon the perils to liberty involved in that course they were pursuing surround the president with ministers of state and the president will be induced to place more confidence in them than in the Senate. An oligarchy will be confirmed upon the ruin of the democracy. The government most hateful will descend to our posterity and all our exertions in the glorious cause of freedom will be frustrated. Gary's speech as a whole was tactful and persuasive but he made a blunder when he appealed to the recollections of the old members, men who had been in the Continental Congress or else in some position where they could view its springs of action. Their recollections now came forward to his discomfort. My official duty said Wadsworth of Connecticut has led me often to attend at the Treasury of the United States. From my experience I venture to pronounce that a Board of Treasury is the worst of all institutions. They have doubled our national debt. He contrasted the order and clearness of accounts while the superintendent of finance was in charge with the situation since then. If the committee had before them the transactions of the Treasury Board instead of system and responsibility, they would find nothing but confusion and disorder without a possibility of checking their accounts. Booty Knot of New Jersey said he would state a circumstance which might give the committee some small idea of what the savings under the superintendent were. The expenditure of hay at a certain post was 140 tons. Such was the estimate laid before him. Yet 12 tons carried the post through the year and the supply was abundant and the post was as fully and usefully occupied as it had ever been before. Of course, there was an outcry against the superintendent of finance. He rather wondered that the climber was not more loud and tremendous. He remembered that 146 supernumerary officers were brushed off in one day who had long been sucking the vital blood and spirit of the nation. Was it to be wondered that if the swarm should raise the buzz about him? Gary fought on almost single-handed, but he could not refute the evidence that he had invited. He lost his temper and resorted to sarcasm if a single head of the Treasury was so deserved, but why not have a single legislator? One man to make all the laws, the revenue laws particularly, because among many there is less responsibility, system and energy. Consequently, a numerous representation in this house is an odious institution. The case for the Treasury Board was so hopeless that nothing more was heard of it, but the battle over the removal question was renewed with added violence. And the bill for establishing the Department of Foreign Affairs came up for consideration. White of Virginia now led the attack. He had been a member of the Continental Congress from 1786 to 1788 and a member of the ratifying convention of the state. Although he voted for a provisional acceptance of the Constitution, he had supported an amendment requiring Congress to collect direct taxes. Or exercises through state agency, which would have been in effect a return to the plan of requisitions, the bane of the confederation. In an elaborate speech, he attacked the clause giving the President power to remove from office as an attempt to impart an authority not conferred by the Constitution and inconsistent with the requirement that appointments should be made with the advice and consent of the Senate. The debate soon became heated. Let us look around at this moment, said Jackson of Georgia, and see the progress we are making toward banality and corruption. We already hear the sounding title of heinous and most honorable trumpeted in our ears, which 10 years since would have exalted a man to a station as high as Heyman's Jibbit. Page of Virginia was ablaze with indignation. Good God, he exclaimed, what authorized in a free republic by law two by your first act the exertion of a dangerous royal prerogative in your chief magistrate. Gary in remarks, who's a bleak criticism upon arrangements that the President's House was perfectly well understood, who walked upon the possibility that the President might be guided by some other criterion than discharge of duty as the law directs. Perhaps the officer is not good-natured enough. He makes an ungraceful bow or does it left leg foremost. This is them becoming in a great officer of the President's levy now because he is so unfortunate as not to be so good a dancer as he is worthy officer. He must be removed these rhetorical flourishes, which are significant of the undercurrent of sentiment. Hardly do justice to the general ability of the debate, which was marked by legal acuteness on both sides. Madison pressed home the sensible argument that the President could not be held to responsibility unless he could control his subordinates. And if it should happen that the officers connect themselves with the Senate, they may mutually support each other and for want of efficacy, reduce the power of the President to a mere vapor in which case his responsibility would be annihilated and the expectation of it unjust. The debate lasted for several days, but Madison won by a vote of 30, 40, 20 in committee in favor of retaining the clause. On second thought, however, and probably after consultation with the little group of constructive statesmen who stood behind the scenes, he decided that it might be dangerous to allow the President's power of removal to arrest upon a legislative grant that might be revoked. When the report from the Committee of the Whole was taken up in the House, a few days later Benson of New York proposed that the disputed clause should be omitted and the language of the bill should be worded so as to imply that the power of removal was in the President. Madison accepted the suggestion and the matter was thus settled. The point was covered by providing that the Chief Clerk of the Department should take charge whenever the Principal Officer shall be removed from office by the President. The clause got through the Senate by the casting vote of the Vice President and a similar provision was inserted without further contest in all the acts creating the Executive Departments. It is rather striking evidence of the utopian expectations which could then be indulged that General Carroll of Maryland has persisted in urging that the existence of the office should be limited to a few years, under a hope that a time will come when the United States would be disengaged from the necessity of supporting a Secretary of Foreign Affairs, although Geary and others expressed sympathy with the motion that was voted down without a division. When the bill establishing the Treasury Department was taken up, Page of Virginia made a violent attack upon the clause authorizing the Secretary to digest and report plans. He denounced it as an attempt to create an undue influence in the House, nor would the Secretary stop here. He would establish a precedent which might be extended until we admitted all the ministers of the government on the floor to explain and support the plans they have digested and reported, thus laying the foundation for an aristocracy or a detestable monarchy. As a matter of fact, a president in favor of access to Congress already existed. The old superintendent of finance and the board which succeeded him had the power now proposed for it, the Secretary of the Treasury. Livermore of New Hampshire, who had been a member of the Continental Congress, admitted this fact but held that such power was not dangerous at that time since Congress then possessed both legislative and executive authority. They could abolish his plans in his office together if they thought proper, but we are restrained by a Senate and by the negative of the President. Geary declared his assent to the views expressed by Page. If the doctrine of having prime and great ministers of state was once well established, he did not doubt that we should soon see them distinguished by a green or red ribbon or other insignia of court favor and patronage. The strongest argument in favor of retaining the clause referred to was made by Fisher Ames, who began to display the powers of clear statement and of convincing argument that soon established his supremacy and debate. He brought the debate at once to his proper bearings by pointing out that there were really only two matters to be considered, whether the proposed arrangement was useful and whether it could be safely guarded from abuse. The Secretary is presumed to acquire the best knowledge of the subject of finance of any member of the community. If this House is to act on the best knowledge of circumstances, it seems to follow logically that the House must obtain the evidence from that officer. The best way of doing this will be publicly from the officer himself by making his duty to furnish us with it. In one of those eloquent passages which brighten the records of debate, whenever Ames spoke at any length, he pictured the difficulties that had to be surmounted. If we consider the present situation of our finances owing to a variety of causes, we shall no doubt perceive a great although unavoidable confusion throughout the whole scene. It presents to the imagination a deep dark and dreary chaos impossible to be reduced to order without the mind of the architect is clear and capacious. Ames and his power commenced to the occasion. He asked what improper influence could a plan reported openly and officially have on the mind of any member more than if the scheme and information were given privately at the Secretary's office. Merely to call for information would not be unmentages to the House. There will be no mark of attention or neglect if you take time to consider the questions you propound. But if you make it his duty to furnish new plans and neglect to perform it, his conduct or capacity is virtually impeached. This will be furnishing an additional check. Cedric of Massachusetts made a strong speech to the same effect. Make your office a responsible. He said with prophetic vision, and the presumption is that plans and information are properly digested. But if he can secrete himself behind the curtain, he might create a mattress influence and not be answerable for the information he gives. The weight of the argument was heavily on the side of the supporters of the cause, and it looked as though the group of objectors would again be beaten. Now, our curious thing happened. Fitz Simmons remarked that if he understood the objection made to the cause, it was a jealousy arising from the power given the Secretary to report plans of revenue to the House. He suggested that harmony might be restored by changing the word report into prepare. Fitz Simmons was esteemed by the House because of his zealous support of the War of Independence and also because he stood high as a successful Philadelphia merchant. But he did not, however, rank as a leader. Early in the session, Ames described him as a man who is supposed to understand trade, and he assumes some weight in such matters. He is plausible, though not over civil. His artful has a glaring eye. A down look speaks low and with apparent candor and coolness. It was hardly the man to guide the House on a matter pertaining to the organization of public authority. While the removal issue was before the House Madison had been prominent in debate and had spoken with great power and earnestness, but up to this time, he had said nothing on the issue now pending. He now remarked that he did not believe that the danger apprehended by some really existed, but twice in his speech he admitted that there is a small possibility, though it is but small, that an officer may derive a weight from this circumstance and have some degree of influence upon the deliberations of the legislature. In his practical effect, the speech favored the compromise which Fitzsimmons had just proposed. In fact, the only opposition to the change of phrasing now came from a few extremists who still claim it for the omission of the entire clause. The decisive effect of Madison's intervention was a natural consequence of the leadership he had held in the movement for the new constitution and of his standing as the representative of the new administration of his possessing Washington's confidence in acting as his advisor. Washington then being without a cabinet had turned to Madison for help in discharging the duties of his office and at Washington's written request, Madison had drafted for him his replies to the addresses of the House and the Senate at the opening of the session. It was a matter of course in such circumstances that the House accepted Fitzsimmons' amendment by a great majority according to the record and thus the Secretary of the Treasury was shut out of the House and was condemned to work in the lobby. The consequences of this decision have been so vast that it is worthwhile making an inquiry into motive, although the materials upon which judgment must rest or scan. No one can read the record of this discussion without noting that Madison's approval of the original clause was Luke Wong as compared with the order he had shown when the question was whether Washington should be allowed to remove his subordinates. This contrast suggests that Madison's behavior was affected by fear of Hamilton's influence. Would it be prudent for him to give Hamilton the advantage of being able to appear in person before the House and probably to supplant Madison himself as the spokesman of the administration? The divergence between the two men had already begun in details. At the time the vote on the powers of the Secretary of the Treasury was taken, the tariff bill and the tonnage bill were still pending and Hamilton's influence operated against Madison's views on some points. Moreover, the question of the permanent residence of the federal government was coming forward and was apparently overshadowing everything else in the minds of members aimed several times in his correspondence at this period, remarks upon Madison's timidity, which was due to his concern about Virginia. State politics. In the arrangement that might enable Hamilton to cross swords with an opponent on the floor of the House could not be attractive to Madison who was a lucid reasoner, but not an impressive speaker. Hamilton was both of these and he possessed an intellectual brilliancy which Madison lacked, aims who respected Madison's abilities, and in regard to him as the leading member of the House wrote that he speaks low, his person is little and ordinary. He speaks decently as to Madison and no more. His language is very pure, perspicuous, and to the point why Fitzsimmons should be opposed to the appearance of the Secretary and person in the House as had been Robert Morris' practice when he was superintendent of finance, as plain enough. McClay's diary has many references to Fitzsimmons' negotiations with members on tariff rates. It was not to the advantage of private diplomacy to allow the Secretary to shape and define issues on the floor of the House. But Fitzsimmons could not have had his way about the matter without Madison's help. Given remarks of the greatest of theological controversies which racked the Roman Empire and affected the peace of millions, turned on the question whether a certain word should be spelled with one diphthong or another. I like disproportion between the vastness of results and the minuteness of verbal distinction as exhibited in this decision by the House. The change of report into prepare through upper ridge in the field of constitutional development that has affected the trend of American politics ever since. This is the explanation of a problem of comparative politics that has often excited much wondering notice why it is that alone among modern representative assemblies the American House of Representatives tends to decline in prestige and authority. The original expectation was that the House of Representatives would take a dominant position like that of the House of Commons, but his degradation began so soon that Fisher Ames noted it as early as 1797. Writing to Hamilton, he observed, the heads of departments are chief clerks, instead of being the ministry, the organs of the executive power and imparting a kind of momentum to the operation of the laws. They are precluded even from communicating with the House by reports. Committees already are the ministers and while the House indulges a jealousy of encroachment in its functions, which are properly deliberative, it does not perceive that these are impaired and nullified by the monopoly as well as the perversion of information by these committees. Just a story who entered Congress in 1808 as a Jeffersonian Republican noted the process of degradation. And in his commentaries, he pointed out the cause the executive is compelled to resort to secret and unseen influences to private interviews and private arrangements to accomplish its own appropriate purposes, instead of proposing and sustaining its own duties and measures by a bold and manly appeal to the nation in the face of its representatives. The last of the organic acts of this session was the one establishing the judiciary. The student will be disappointed if he examines the record to note whether there was any vision of the ascendancy which the judiciary was to obtain in the development of the American constitutional system. The debates were almost wholly about the possibilities of conflict between the state and the federal courts. Although McClay's diary gives out one sided and distorted account of the proceedings in the Senate, the course of the debate is clear. Ellsworth of Connecticut had principle charge of the bill at the outset. Lee and Grayson of Virginia made an ineffectual effort to confine the original jurisdiction of the federal courts to cases of admiralty and maritime jurisdiction and argued that jurisdiction over other cases involving federal law might be conferred upon state courts. This was a point on which there had been some difference of opinion between Hamilton and Madison. The former held that it was within the competency of Congress when instituting tribunals and fury to the Supreme Court to adopt the state court for that purpose. Madison held that nothing less than a system of federal courts quite distinct from the state courts would satisfy the requirements of the Constitution. When the bill was taken up in the House, there was a long debate over this matter, the costly duplication of judicial establishments that has ever since existed in the United States is certainly not necessary to a federal system but is an American peculiarity. The advocates of a unified system were hampered by the fact that this view was pressed by some in a spirit of hostility to the Constitution. The decisive argument was the untrustworthiness of the state courts. Madison urged this fact with great force and pointed out that in some of the states the courts are so dependent on the state legislatures that to make the federal laws dependent on them, there is back into all the embarrassments which characterized our former situation. Such was the low repute of the state legislatures that the only way in which this argument could be met was to argue that Congress shall have power in its fullest extent to correct, reverse, or affirm any decree of a state court. This high assertion of federal authority was made by Jackson of Georgia in the course of a long legal argument. The debate did not follow sectional lines and in general it was not unfairly described by McClay as a lawyer's wrangle. The bill was put into shape by the Senate and reached the House toward the close of the session when the struggle over the site of the national capital was over shattering everything else. It was so generally believed that nothing important could be gained by attempts at amendment that after an airing of opinions the House accepted the measure just as it had come from the Senate. End of Chapter 2, Chapter 3 of Washington and his colleagues by Henry Jones Ford. This LibriVox recording is in the public domain. Chapter 3, The Master Builder. The subject of national finance had long interest of Hamilton. His ideas had been matured by a diligent and minute study of English precedence and now that his opportunity had come he was ready to grasp it. Soon after he took office the House resolved that an adequate provision for the support of the public credit should be made and it directed the Secretary of the Treasury to prepare a plan for that purpose and to report the same to the House at its next meeting. It was in effect a postponement until the second session of the first Congress which began in January 1790 in his opening address to Congress Washington pointedly referred to the public credit resolution, which he had noted with peculiar pleasure. On the next day a letter from Hamilton was read in the House stating that he had prepared his plan and was ready to report the same to the House when they should be pleased to receive it. This announcement brought up the question of what manner the Secretary should make his report. Gary was on his feet at once with a motion that it should be made in writing. Boudinot hoped that the Secretary of the Treasury might be permitted to make his report in person in order to answer such inquiries as the members might be disposed to make, for it was a justifiable surmise that gentlemen would not be able clearly to comprehend so intricate a subject without oral illustration. The illusion to the intricacy of the subject had the effect of turning against the plan of oral communication, some who had favored giving the Secretary the same direct access to Congress that the superintendent of finance had formerly enjoyed. Ames for instance now desired that the Secretary's communications should be in writing since in this shape they would obtain a degree of permanency favorable to the responsibility of the officer, but at the same time they would be less liable to be misunderstood. Benson suggested that since the resolution of Congress had directed the Secretary to make a report it was left to his discretion to make it in the manner for which he is prepared. Gary adroitly countered by saying that the resolution provided for a report that done it would be time enough to give him the right to lay before them is explanations if he thinks explanations necessary. The debate was brief and one sided the motion for receiving the report in writing was adopted without a division. Five days later the written report was laid before the House, but the secretary was never accorded an opportunity to offer any personal explanations. This masterly report which is destined regarded as the cornerstone of American public credit excites the admiration of the reader by the clearness of its analysis, the cogency of its argument and the broad range of its vision. The principles of action that it embodied however were few and simple, chief among them being exact and punctual fulfillment of contract states like individuals who observe their engagements are respected and trusted. While the reverse is the fate of those who pursue an opposite conduct to discharge the principle of the public debt was of course impracticable, nor was it desirable as the creditors would be well pleased to leave it at interest. Incidentally, the funding of the debt would provide securities that would serve trade as a species of currency and would set in motion a long train of benefits that would extend throughout the community in the funding operation the debts contracted by the states should be included. As to this Hamilton remark, the general principle of it seems to be equitable for it seems difficult to conceive a good reason why the expenses for the particular defense of a part in a common war should not be a common charge, as well as those incurred professedly for the general defense. The defense of each part is that of the whole, and unless the expenditures are brought into a common mass, the tendency must be to add to the calamities suffered by being the most exposed to the ravages of war and increase of burdens. Hamilton computed the amount of the foreign debt principle and arrears at $11,710,378.62, the domestic debt including that of the states at $42,414,085.94, a total of over $54,000,000 with an annual interest charge at existing rates amounting to $4,587,000. $4,044.81, a staggering total for a nation whose revenue was then insufficient to meet its current expenses. Nevertheless, Hamilton refused to admit that such a provision would exceed the abilities of the country, but he was clearly of the opinion that to make it would require the extension of taxation to a degree and to objects which the true interest of the public creditor forbids. He therefore favored a composition in arranging which there would be strict adherence to the principle that no change in the rights of creditors ought to be attempted without their voluntary consent and that this consent ought to be voluntary, in fact, as well as in name. It followed that every proposal of a change ought to be in the shape of an appeal to their interests but not to their necessities. Hamilton then went into details of a funding loan in which various options were offered to the creditors including land grants, impart payment, and conversion in whole or impart into annuities, several sorts of which were offered. He submitted estimates of how the various plans would work out in practice and he concluded that the annual revenue which would be required to enable the government to meet its obligations under this theme and also to maintain its current service would amount to $239,163.09, a sum that could be readily provided. There could not have been a more striking contrast than there was between the humiliating conditions which actually existed in the grand results which Hamilton designed and confidently expected. The ardent and hopeful tone of his plan conceived in apparently desperate circumstances is very marked, he declared. He cannot but merit particular attention that among ourselves, the most enlightened friends of good government are those whose expectations are the highest to justify and preserve their confidence to promote the increasing respectability of the American name to answer the cause of justice, to restore landed property to its due value, to furnish new resources both to agriculture and commerce, to cement more closely the union of the states, to add to their security against foreign government, to establish public order on the basis of a liberal and upright policy. These are the great and invaluable ends to be secured by a proper inadequate provision at the present period for the support of public credit. All these great objects were indeed attained but Hamilton's expectation of them was at the time regarded as either a pretext made to Kajou, Congress or else merely an ebullition from his own sanguine nature not to be taken too seriously by sensible people. Senator McClay of Pennsylvania regarded Hamilton's plans as wildly extravagant in their perception and iniquitous in their practical effect. In his opinion Hamilton had a very boyish, giddy manner and scotch Irish people could well call him a Skype. Jackson of Georgia exposed to the House the folly of Hamilton's proposals by pointing out that funded debt meant national decay. He mentioned England as a melancholy instance of the ruin attending such engagements to such a pitch had that spirit of funding and borrowing been carried in that country that its national debt was now a burden which the most languid mind can never contemplate they will ever be relieved from. France also was considerably enfeebled and languishes under a heavy load of debt. He argued that by funding the debt in America the same effect must be produced that has taken place in other nations. One must either bring on national bankruptcy or annihilate her existence as an independent empire. Such dismal prognostications on the eve of the Napoleonic era with its tremendous revelations of national power were quite common at that time. There was a troubling debate that took place in the House when Hamilton's report was taken up for consideration of bounds with similar instances of short-sightedness. Many members did not scruple to advise repudiation in whole or in part. The report of New Hampshire admitted that the foreign debt should be provided for since it was lent to the United States in real coin by disinterest to persons not concerned or benefited by the revolution, but that the domestic debt was for depreciated paper or services or for goods or provisions supplied at more than their real worth by those who received all the benefits arising from our change of condition. True, Congress had pledged his faith to the redemption of issues at their face value, but this was done on a principle of policy in order to prevent the rapid depreciation which was taking place. He argued that money lent in this depreciated and depreciating state can only be said to be lent from a spirit of patriotism. It was a mere speculation in public securities. The distinction between the foreign debt and the domestic was seized by many members as providing a just basis for discrimination. In Virginia observed that our citizens were deeply interested and I believe if they were never to get a farthing for what is owing to them for their services, they would be well paid. They have gained what they aimed at. They have secured their liberties and their laws. They will be satisfied that this House has pledged itself to pay foreigners the generous loans they advanced to us in the day of distress. In the course of the debate, the power to do was so often mentioned as implying the right to do that aims was moved to remark. I've heard that in the East Indies, the stock of the labor and the property of the empire is the property of the prince. It is held at his will and pleasure, but this is a slavey doctrine, which I hope we are not prepared to adopt here. As a matter of fact, there had already been extensive scaling of the debt and the note emissions have been pretty nearly wiped out to save the public credit from complete collapse. The Continental Congress had entered into definite contracts under the most solemn pledges and it was upon this select class of securities that it was now proposed to start anew the process of repudiation, a public opinion despite itself so hostile to such that the party of repudiation in Congress soon dwindled to insignificance and the struggle finally settled upon two issues, discrimination and assumption. Weeks of debate ensued and the deepest impression made by a careful perusal of the record is the inability of members to appreciate the importance of the issues. Much of the tedious and pointless character of their speeches may be ascribed to the lack of the personal presence of the secretary. They're being nothing to focus the debate and exclude the fictitious and irrelevant. It didn't ramble in any direction as speakers fancy might suggest. Moreover, his quality was impaired because any consideration of motive was of the nature of talking about a man behind his back. And this everyone knows is very different from saying things to his face. Assertions and innuendos which would hardly have been hazarded had Hamilton been present for which have they been made would have been forthwith met and refuted were indulged in without restraint. Although one of the reasons given for requiring a written report was that the House would be the better informed. The debate does not indicate that the arguments by which Hamilton had vindicated his proposals had really been apprehended. The question whether or not any discrimination could be made between original holders of the public securities and those who had acquired them by purchase was considered at length by Hamilton in his report. The public securities have been at such a heavy discount that now if they were to be met at face value speculators would reap large profits. Hamilton put the case of the opposition as strongly as possible. It might be urged that it was unreasonable to pay 20 shillings in the pound to one who had not given more for it than three or four. And it is added that it would be hard to aggravate the misfortune of the first owner who probably through necessity parted with his property at so great a loss by obliging him to contribute to the profit of the person who had speculated on his distresses. Nevertheless Hamilton submitted consideration showing that discrimination would be equally unjust and in polity as highly injurious even to the original holders of public securities as ruinous to public credit. It is unnecessary to repeat the lucid argument by which Hamilton demonstrated the soundness of his position for security of transfer is now well understood to be an essential element of public credit. The special point of interest is that the debate simply ignored Hamilton's argument and rambled along over the superficial aspects of the case, dwelling upon the SARS of those who had parted with their holdings and exhibiting their situation as the most important matter to be considered. Madison was most active in making that branch of the case the leading issue and in a series of elaborate speeches which cannot now be read without regret. He urged that the present holders should be allowed only the highest market price previously recorded and that the residue should go to the original holders. Booty Knot had once pointed out that there was nothing on record to show who might be an original bona fide holder. Great quantities of that certificates of indebtedness had as a mere matter of convenience been issued to government clerks who afterwards distributed them among those who furnished supplies to the government or who performed services and typing them to pay. He mentioned that he himself appeared on the record as original holder in cases, wherein he had really acted in behalf of his neighbors to relieve them of the trouble of personal appearance. Madison's proposition would therefore invest in without legal title to property, which really belonged to others. But this and other evidence of the real effect of Madison's proposal failed to move him further than to cause him to declare that all that he wished was that the claims of the original holders, not less than those of the actual holders should be fairly examined and justly decided. Bonnie Benson of New York gave him a shrewd home thrust that plainly embarrassed him. He put the question whether if he had purchased a certificate from Madison and the treasury withheld part of the amount for Madison as the original holder, Madison will keep the money. I asked Sir Benson whether he would take advantage of the law against me and refused to give me authority to take it up in his name. Madison evaded the query by saying that everything would depend upon the circumstances of any particular case, and that circumstances were conceivable in which the most tender conscience need not refrain from taking the benefit of what the government had determined. The debate on Madison's discrimination amendment lasted from the 11th to the 22nd day of February, Washington's birthday. The House did honor to the day when it rejected Madison's motion by the question vote of 36 to 13, without his pretensions to the leadership of the House quite disappeared. The assumption of state deaths was the subject of a debate and committee of the whole, which lasted from the 23rd of February to the 2nd of March. New factional lines now revealed a supposed diversity of interest of the several states. The false notions of finance then current were illustrated by an argument that was in continual use, either on the floor or in the lobby. The numbers would figure how much their states would have to pay as their share of the debt that would be assumed and on that basis would reach conclusions as to how their state stood to win or lose by the transaction. By this reckoning, of course, the great gainer would appear to be the state upon whom the chances of war had piled the largest debt. This calculation made Burke of South Carolina, usually an opponent of anything coming from Hamilton, a strong advocate of assumption. He told the House that if the present question was lost, he was almost certainly within in her bankruptcy, for she South Carolina was no more able to grapple with her enormous debt than a boy of 12 years of age is able to grapple with a giant. Livermore representing a state never within the actual field of military operations. And once replied, I can see that the debt of South Carolina, or Massachusetts, or of an individual has nothing to do with our deliberations. If they have involved themselves in debt, it is their misfortune, and they must extricate themselves as well as they can. On another occasion, Stone of Maryland, another state that lay outside the track of war, gave the leading war debt states in the admonition of the kind that adds insult to injury, saying however inconvenient it may be to Massachusetts or South Carolina to make a bold exertion and nobly bear the burdens of their present debt. I believe in the end it would be found to conduce greatly to their advantage. Burke made a question rejoinder, whereas Maryland, like South Carolina, constantly grappling with the enemy during the whole war. There is not a road in the state but has witnessed the ravages of war. Plantations were destroyed in the skeletons of houses. To this day point up to the traveler, the root of the British Army. Her citizens were exposed to every violence, their capital taken, and their country almost overrun by the enemy. In women and children murdered by the Indians and Tories, all the personal property consumed. And now is it to be wondered at that she is not able to make exertions equal with other states who have been generally in an undisturbed condition. The argument pressed by the advocates of assumption was that the state debts contracted during the Revolutionary War were for the common defense and that unless these were assumed by the government, the adoption of the new constitution would do injury by withdrawing revenue resources, which the states had formerly possessed. This position at the present day seems reasonable enough, but it is certain that at that time people work themselves into a genuine rage over the matter. And we're able to persuade themselves into a sincere belief that it was outrageous. The unfortunate state should expect the others to bear their troubles. And that Hamilton was a great rogue for proposing such a scheme. Writing in his private diary, McClay characterized the plan as a monument of political absurdity and he was in the habit of referring to Hamilton supporters as his gladiators and as a corrupt squadron. On the whole, the records make painful reading. The prevailing tone of public life was one of dull and narrow provincialism, at times thickening into stupidity, at times sharpening into spite, although ordinarily made respectable by a serious attitude to life and by a stolid fortitude in facing whatever the distracted times might present. It was the influence of a few great men that made America a nation. If one is not subject to the spirit of ancestral worship that has long ruled American history, one is bound to say that apart from some forceful pamphleteering of transient purpose, the voluminous political literature of that formative period displays much pedantic erudition, but it has little that goes really deep. The Federalist, the artillery of a hard fought battle, is a striking exception. So too is the series of reports by Hamilton, but his plans could not prevail by force of reason against the general spirit of selfish particularism. Although on March 2, a motion adverse to Assumption and Committee of the Whole was defeated by a vote of 28 to 22, it was then known that a majority could not be procured for enactment. And on April 12, the Assumption Bill was defeated outright in the House, 31 to 29, but Clay, who went over to the House from the Senate to witness the event, floated over to defeat in his diary. Cedric from Boston pronounced a funeral oration over it. He was called to order. Some confusion ensued. He took his hat and went out. When he returned, his visage bore at the visible marks of weeping. Fitzsimmons, reddened like scarlet, his eyes were brimful. Climbers, color, always pale, now merged to a deadly white. His lips quivered and his nether jaw shook with convulsive motions. His head, neck, and breast contracted with gesticulations resembling those of a turkey or goose nearly strangled in the active D. Glutition. Benson bungled like a shoemaker who has lost his end. Wadsworth hid his grief under the rim of a round hat. Booty knots, wrinkles, rows and bridges and the angles of his mouth were depressed and assumed a curve resembling a horse's shoe. The defeat did not discourage Hamilton. He had successfully handled a more difficult situation in getting New York to ratify the Constitution. And resorting now to the same means he had then employed, he used pressure of interest to move those who could not be stirred by reason. The intense concern felt by members in the choice of the site of the national capital supplied him with the leverage which he brought to bear on the situation. Those to the members were more stirred by that question than by any other before Congress. It was a prominent topic in Madison's correspondence from the time the Constitution was adopted. McClay's diary abounds with references to the subject. Some of his bitter sentences are penned about the conduct of those who preferred some other site to that on the Susquehanna River, which he knew to be the best because he lived there himself. Bargaining among the members as to the selection had been going on almost from the first as early as April 26, 1789 before Washington had been installed in his office. McClay mentions a meeting to concert some measures for the removal of Congress. Thereafter, notices of pending deals appeared frequently in his diary. After the defeat of the assumption bill, the diary notes the activity of Hamilton in this matter. An entry of June 14, 1790 ascribes to Robert Morris the statement that Hamilton said he wanted one vote in the Senate and five in the House of Representatives that he was willing and would agree to place the prominent residents of Congress in Germantown or falls of the Delaware Trenton. If he would procure him those votes, although definite knowledge is unattainable, one gets the impression in following the devious course of these intrigues that have Pennsylvania interests been united. They could have decided the site of the national capital, but the delegation was divided over the relative merits of the Delaware and Susquehanna as well as on the question of assumption Hamilton's efforts in this quarter were ineffectual and the winning combination was finally arranged elsewhere. And otherwise by the aid of Jefferson. Thomas Jefferson was at this time 47 years old and owing both to seniority and to the distinguished positions he had held. He ranked as the most illustrious member of the administration. His correspondence of the spirit shows that he was fully aware of the importance of the crisis and he did not overrated. When he wrote to James Monroe, June 2079 that unless the measures of the administration were successful, our credit will burst and vanish and the state separate to take care everyone of itself in this letter. Jefferson outlined the compromise that was actually adopted by Congress. The strongest opposition to the assumption bill had come from Virginia, although Maryland, Georgia and New Hampshire also opposed it. In the middle of states were divided. Jefferson was able to get enough southern votes to carry assumption in return for enough votes from Hamilton's adherents to carry the Potomac site. An agreement was reached at a dinner given by Jefferson to which he invited Hamilton in Madison. According to this arrangement, the capital was to remain in Philadelphia for 10 years and after that to be on the Potomac River in a district 10 mile square to be selected by the president. The Residents Act was approved July 1679. The funding and assumption measures now combined in one bill became law on August 4. After Jefferson turned against the administration, his participation in the passage of the assumption bill was such an awkward circumstance that he discredited Jefferson intelligence by professing that he was most ignorant and innocently made to hold the candle to Hamilton's game. In reality, the public service Jefferson then performed was the most useful in all his long and fruitful career. Before this action, the Declaration of Independence to the drafting of which he owes his greatest fame might now be figuring among the historical documents of lost causes like similar elaborate statements of principle made during the Commonwealth period in England. Had the national forces failed at the critical period of financial organization and the state's bankrupt by the revolutionary struggle been left in the Lurch, the Republic would have followed the usual course of disintegration displayed by federations from the time of the Greek and fictiones down to that of the Holy Roman Empire. The charge was made soon after Hamilton's victory that it was largely due to the influence of speculators. The advance in the market value of securities produced by Hamilton's measures certainly gave an opportunity to speculators of which they availed themselves with the unscrupulous activity characteristic of that sorted tribe. Jefferson has left an account of the base scramble couriers and relay horses by land and swift sailing pilot boats by sea were flying in all directions active partners and agents were associated and employed in every state town and country neighborhood. In this paper it was brought up at five shuns and even as low as two shillings in the pound before the holder knew that Congress had already provided for its assumption that par immense sums were thus filled from the poor and ignorant and fortunes accumulated by those who have themselves been poor enough before. This account is highly colored. The struggle was too close and the issue was long too doubtful to admit a speculative preparations extending to every town and country neighborhood. If speculation took place on such a large scale it must have been also taking risk on a large scale. For assumption was not assured until Jefferson himself put his shoulder to the wheel. The lack of means for prompt diffusion of intelligence naturally provided large opportunity for speculation by those in a position to keep well informed and undoubtedly large profits were made. But the circumstances were such that it seems most probable that profits were less than market opportunities would have allowed have not issue been so long in doubt. Nevertheless, there was much speculative activity and the charge was soon made that it extended into Congress. Food note this charge was put forth by John Taylor and pamphlet sprinted in 7093 and 7094 which he reviewed the financial policy of the administration and gave a list of congressmen. We had invested in the public funds the facts on which this charge rests have been collected and examined by Professor Beart in his economic origins of Jeffersonian democracy. His analysis shows that out of 64 members of the House 29 were security holders and of these 21 voted for and eight voted against assumption. But the facts disclose do not sustain his theory that the issue was essentially a conflict between capitalism and agrarianism. The assumption bill was lifted to its place on the statute book through the leverage exerted by Hamilton and Jefferson with Washington's prestige as their fulcrum. The characters of these three men resists schemes of classification according to economic interest. The principal value of analysis of the economic elements of the struggle is to protect from undervaluation the motives that actuated the opposition to Hamilton's measures. The historian has the advantage of our perspective denied to participants in events and this factors up to turn and delete to the discredit of lost causes. The passage of assumption was the turning point other important measures followed but none of them met with difficulties which the administration could not overcome by ordinary methods of persuasion and appeal. The National Bank was authorized by an act approved on February 25, 1791. Hamilton's famous report and manufactures a masterly analysis of the sources of national wealth and of the means of improving them was sent to Congress on December 5, 1791. Upon his recommendation, Congress established the mint, the only point which excited controversy being Hamilton's proposal that the coin should be stamped with the head of the president. In his administration, they were issued. His suggestion was rejected on the ground that it smacked too much of the practice of monarchies. The queer, optimistic designs of American coinage are a consequence of this decision. The formation of national government voluntary agreement is a unique event. The explanation of this peculiar result in the case of America is the unifying influence of Hamilton's measures. They interested in the support of the government economic forces strong enough to counteract the separatist tendencies that have always before broken up states unless they were held together by sheer might of power in their rulers. The means employed have been cited as evidence in support of the economic interpretation of history. Now in fashion government, it is true like every other form of life must meet the fundamental needs of subsistence and defense. But this truism supplies no explanation of the particular mode of doing so that may be adopted. Those needs account for motion but not for direction. Human will, discernment and purpose enter and complicate the situation in a way that makes theories of determinism appear absurd. No one has ever intended that Hamilton was prompted by an economic motive in giving up his law practice to accept public office. He did so against remonstrances of his friends whose predictions that what he would get out of it for himself would be calamity, persecution and loss of fortune were all fully verified. But he possessed the nature which found its happiness in bringing high ideals to grand fulfillment and in applying his powers to that object he let everything else go. Hamilton's career is one of the greatest of those facts that baffle attempts to reduce history to an exhibition of the play of economic forces. End of Chapter 3.