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Browsing: Papers of John Adams, Volume 9


Docno: ADMS-06-09-02-0279

Author: Adams, John
Date: 1780-06-20

John Adams' Commission to Negotiate a Loan with the Netherlands

The United States of America in Congress assembled.
To the Honble. John Adams Esquire Greeting.
Whereas by our commission to the Honble. Henry Laurens Esqr. bearing date the thirtieth day of October in the Year of our Lord one thousand seven hundred and seventy nine,2 we have constituted and appointed him the said Henry Laurens during our pleasure, our Agent for and on behalf of the said United States to negotiate a loan with any person or persons bodies politic and corporate: And Whereas the { 453 } said Henry Laurens has by unavoidable Accidents been hitherto prevented from proceeding on his said Agency; We therefore reposing especial trust and confidence in your patriotism Ability, conduct and fidelity, do by these presents constitute and appoint you the said John Adams until the said Henry Laurens or some other person appointed in his stead shall arrive in Europe and undertake the execution of the aforesaid commission, our Agent for and on behalf of the said United States to negotiate a Loan with any person or persons bodies politic and corporate, promising in good faith to ratify and confirm whatsoever shall by you be done in the premisses or relating thereunto. Witness His Excellency Samuel Huntington Esqr. President of the Congress of the United States of America at Philadelphia the twentieth day of June in the Year of our Lord one thousand seven hundred and Eighty, and in the fourth year of our Independence.3
[signed] Saml. Huntington President
[signed] Attest Chas. Thomson Secy.
MS (Adams Papers;) endorsed by Francis Dana: “J. Adams's provisional Appointment to negotiate a Loan.” This document was enclosed in a letter of 11 July from the Committee for Foreign Affairs (Adams Papers) and was filmed under that date (Adams Papers, Microfilms, Reel No. 352).
1. Although voted by Congress on 20 June, the commission was not sent off until 11 July as one of three enclosures in a letter of that date from the Committee for Foreign Affairs (Adams Papers). The other two enclosures contained Congress' resolutions of 21 and 26 Oct. 1779 regarding Laurens' commission and those of 20 June 1780 relating to JA's appointment. (JCC, 15:1198, 1210; 17:534–537). The committee's letter of 11 July and several other letters were entrusted to James Searle, former delegate from Pennsylvania, who was going to Europe as Pennsylvania's agent to raise a loan. In early September Searle reached Paris and gave the letters from Congress to Francis Dana who delivered them to JA at Amsterdam on 17 Sept. (from Dana, 16 Sept.; to William Churchill Houston, 17 Sept., both below).
2. Except for the references to Henry Laurens, JA's commission is identical to that voted for Laurens in 1779 (JCC, 15:1230).
3. Francis Dana received a nearly identical commission empowering him to act in the event that JA was unable to exercise his commission (same, 17:537; MHi: Dana Papers).

Docno: ADMS-06-09-02-0280

Docno: ADMS-06-09-02-0280-0001

Docno: ADMS-06-09-02-0280-0001-0001

Author: Vergennes, Charles Gravier, Comte de
Recipient: Adams, John
Date: 1780-06-21

From the Comte de Vergennes

J'ai reçu, Monsieur, la lettre que vous m'avez fait l'honneur de m'écrire le 16 de ce mois, ainsi que l'Extrait de celle qui vous été addressée de Boston sous la datte du 26 avril.
Selon cette derniére l'assemblée de l'Etat de Massachussett s'est
{ 454 } { 455 }
déterminé à adopter la résolution par laquelle le Congrés Général a fixé le papier-Monnoye à 40 Dollars pour un Dollar de mannoye effective. En lisant cette résolution, je m'étois persuadé qu'elle n'avoit d'autre objet que celui de remettre en valeur le Papier-monnoye en diminuant la trop grande quantité, et qu'a la suite de cette opération, le papier qui n'auroit pas été rapporté, reprendroit son cours selon que les circonstances lui donneroient plus ou moins de crédit: ce qui a du me confirmer dans cette opinion, c'est la liberté laissée aux possesseurs du papier-monnoye de le porter à la caisse de leur Etat, ou de le garder par devers eux.
Mais d'après les informations qui me Sont parvenues depuis,1 et d'après la lettre même que vous avez bien voulu me communiquer, Monsieur, j'ai lieu de juger que l'intention du Congrés est de maintenir invariablement le Papier-monnoye au change de 40. p. 1. et de faire rentrer sur ce pied tout le papier qu'il a mis en circulation, afin de réduire insensiblement à 5 millions à peu-près les deux cents millions de Dollars dont il se trouve chargé.
Je me garderai bien, Monsieur, de critiquer cette opération en elle-même, parceque je n'ai aucun titre pour analyser et Commenter les arrangements intérieurs que le Congrès peut regarder comme justes et utiles; d'ailleurs je conviens volontiers qu'il peut être des positions assez critiques pour forcer les Gouvernements même les plus réglés, et qui ont depuis longtems acquis toute leur consistance, à prendre des mesures extraordinaires pour rétablir leurs finances, et pour se mettre en état de faire face aux charges publiques; et je suis persuadé que telle a été en effet, la cause majeure qui a mis le Congrès dans le cas de déprécier le papier-Monnoye qu'il avoit lui même créé.
Mais en admettant, Monsieur, que cette assemblée a pu avoir recours à l'expédient dont il s'agit pour alléger le poids de sa dette, je suis bien éloigné de convenir qu'il est juste et dans l'ordre ordinaire des choses d'en étendre l'effet sur les sujets étrangers comme sur les Citoyens des Etats-Unis: Je pense au contraire que l'on auroit du la restreindre aux seuls américains et faire une exception en faveur de ces mêmes Etrangers, ou au moins déterminer un moyen de dédommager ceux-ci des pertes que la loi générale leur feroit éprouver.
Pour vous faire sentir cette vérité, je ne vous dirai pas, Monsieur, que c'est aux Américains seuls à supporter les charges que le soutien de leur liberté peut occasionner, qu'ils doivent regarder la déprécia• { 456 } tion du papier-monnoye simplement comme un impôt qui doit se concentrer parmi eux, puisque le papier n'a été établi originairement que pour les soustraire à la nécessité d'en payer; je me bornerai à vous observer que les françois, s'ils étoient obligés de subir la réduction proposée par le Congrès, se trouveroient être les victimes du Zêle et, je puis le dire, de la témérité avec laquelle ils se sont exposés à fournir aux Américains, des armes, des munitions, des vêtements, en un mot, toutes les choses de premiére nécessité dont l'Amérique avoit le besoin le plus instant. Vous conviendrez avec moi, Monsieur, que ce n'est point là le sort auquel les sujets du Roi devoient s'attendre; que bien loin de craindre qu'après avoir échappé aux périls de la mer, à la vigilance des anglois, ils se verroient dépouillés en Amérique: Ils devoient compter au contraire sur la reconnoissance du Congrès et de tout le peuple Américain, et croire leurs propriétés aussi sûres et aussi sacrées en Amérique qu'en france même: C'est dans cette persuasion, c'est en se fiant sur la foi publique, qu'ils ont reçu du papier-monnoye en échange de leurs marchandises, et qu'ils ont conservé ce papier dans la vuë de l'employer à de nouvelles spéculations de Commerce. La réduction inopinée de ce même papier renverse leurs calculs en même tems qu'elle détruit leur fortune: Je vous demande, Monsieur, si ces résultats vous portent à croire que l'opération du Congrès est propre à donner du crédit aux Etat-Unis, à inspirer de la confiance dans ses promesses, à inviter les nations Européennes à partager les mêmes risques auxquels les sujets de Sa Majesté se sont exposés.
Telles sont, Monsieur, les réfléxions principales que m'a fait faire la résolution du Congrès du 18. Mars: Je me sais un devoir de vous les Communiquer avec une entiére confiance, parce que vous êtes trop éclairé pour n'en point sentir la force et la justesse, et trop attaché à votre patrie pour que vous ne fassiez point tous vos efforts pour l'engager à revenir sur ses pas en faisant justice aux sujets du Roi:2 Je ne vous cacherai pas que M. le Chevalier de la Luzerne a déjà reçu l'ordre de faire, sur l'objet dont il est question, les représentations les plus fortes,3 et que le Roi est dans la ferme persuasion que les Etats-Unis s'empresseront de lui donner dans cette occasion une marque de leur attachement en accordant à ses sujets la juste satisfaction qu'ils sollicitent et qu'ils attendent de leur justice et de leur sagesse.
J'ai l'honneur d'être très sincérement, Monsieur, votre très humble et très obéissant serviteur,
[signed] De Vergennes
{ 457 }

Docno: ADMS-06-09-02-0280-0001-0002

Author: Vergennes, Charles Gravier, Comte de
Recipient: Adams, John
Date: 1780-06-21

The Comte de Vergennes to John Adams: A Translation

I have received, sir, the letter that you did me the honor to write on the 16th of this month, and also the extract of the letter addressed to you from Boston, dated 26 April.
From this it appears that the assembly of Massachusetts has determined to adopt Congress' resolution fixing the value of the paper money at 40 dollars for one dollar in specie. On reading that resolution I was persuaded that it had no object other than restoring the value of the paper money by lessening its quantity and that, in consequence of that operation, the paper not brought in would take its course according to the circumstances that would give it a greater or less degree of credit. I was confirmed in this opinion by the liberty given to the possessors of the paper money to carry it to their state's treasury or keep it in their own possession.
But from information I have since received,1 and the letter which you have been pleased to communicate to me, I have reason to believe that it is Congress' intention to maintain the paper money invariably at the exchange of 40 for 1 and to settle on that footing all the paper money that has been thrown into circulation so as to reduce gradually the two hundred million dollars, for which it is indebted, to five million.
I will not presume, sir, to criticize this operation, for I have no right to examine or comment on the internal arrangements which Congress may consider as just and expedient; and, moreover, I readily agree that there may be some situations so critical as to force the best regulated governments to adopt extraordinary measures to repair their finances and put them in condition to answer the public expenses; and this I am persuaded has been the principal reason that induced Congress to depreciate the money, which they themselves have emitted.
But while I admit, sir, that that assembly might have recourse to the expedient abovementioned in order to remove their load of debt, I am far from agreeing that it is just or, in the ordinary course of things, agreeable to extend the effect to foreigners as well as to citizens of the United States. On the contrary I think it should be confined to Americans and that an exception ought to be made in favor of foreigners, or at least that some means devised to indemnify them for the losses they may suffer by the general law.
In order to make you sensible of the truth of this observation, I will only remark, sir, that the Americans alone should support the expense occasioned by the defence of their liberty, and that they should consider the depreciation of their paper money simply as an impost which should fall on themselves, as the paper money was first established only to relieve them from the necessity of paying taxes. I will only add that the French, if obliged to submit to the reduction proposed by Congress, will find themselves victims of their zeal and, I may say, of the rashness with which they exposed { 458 } themselves in furnishing the Americans with arms, ammunition, and clothing, and, in a word, all things of the first necessity, of which the Americans at the time stood in need. You will agree with me, sir, that this is not what the subjects of the King should expect, and that after escaping the dangers of the sea, the vigilance of the English, instead of dreading to see themselves plundered in America, they should, on the contrary, expect the thanks of Congress and all Americans, secure in the belief that their property will be as secure and sacred in America as in France itself. It was with this conviction and relying on public faith that they received paper money in exchange for their merchandize, and kept that paper with a view to employ it in new commercial speculation. The unexpected reduction of this paper overturns their calculations at the same time that it ruins their fortune. I ask, sir, if these consequences can induce you to believe, that this act of Congress is proper to advance the credit of the United States, to inspire confidence in their promises, to invite European nations to run the same risks to which the subjects of his majesty have exposed themselves.
These, sir, are the principal reflections occasioned by Congress' resolution of 18 March. I thought it my duty to communicate them to you with full confidence, because you are too enlightened not to feel the force and justice, and too much attached to your country not to use all your endeavors to engage it to take steps to do justice to the subjects of the King.2 I will not conceal from you that the Chevalier de La Luzerne has been ordered to make the strongest representations on this subject,3 and that the King is firmly persuaded that the United States will eagerly give him, on this occasion, a mark of their attachment by granting his subjects the just satisfaction which they solicit and expect from the justice and wisdom of the United States.
I have the honor to be very sincerely, sir, your very humble and very obedient servant,
[signed] De Vergennes
RC (Adams Papers;) endorsed: “M. Le C. De Vergennes 21. June 1780.”; notation by CFA: “a Translation published. See Sparks' Dipl. Corr. Vol 5 p. 208.” CFA's reference is to Jared Sparks, ed., Diplomatic Correspondence of the American Revolution, 12 vols., Boston, 1829–1830.
1. This may refer to Leray de Chaumont's account of his conversation with JA on 15 June (Chaumont to Rayneval, 16 June, above).
2. JA, unlike Benjamin Franklin, had no official standing in France and thus this request, the letter itself, and the nature of the previous discussions between the two men (to the president of Congress, 26 June, No. 87, below) departed from normal diplomatic procedure. JA's awareness of this is evident from his letter to Benjamin Franklin of [22] June (below). Vergennes should have few doubts as to JA's response to a request that he seek a revision of the resolution of 18 March, but see his letter of 30 June (below).
3. La Luzerne's instructions were dated 3 June, but instead of ordering La Luzerne to make strong, official representations regarding the revaluation, Vergennes directed him to consult with the principal members of Congress in order to convince them of the need to exempt Frenchmen from the effects of the revaluation without repealing the revaluation itself (Henri Doniol, Histoire de la participation de la France à l'etablissement des { 459 } Etats-Unis d'Amérique, 5 vols., Paris, 1886– 1892, 4: 415). Realizing the futility of that undertaking, La Luzerne never seriously attempted to obtain the revision of the resolution of 18 March (Stinchcombe, Amer. Rev. and the French Alliance, p. 155–156).

Docno: ADMS-06-09-02-0280-0002

Author: Adams, John
Recipient: Franklin, Benjamin
Date: 1780-06-22

To Benjamin Franklin

[salute] Sir

I have this Day the honour of a Letter from his Excellency the Comte De Vergennes, on the subject of the Resolutions of Congress of the Eighteenth of March, concerning the Paper-Bills; in which his Excellency informs me that the Chevalier De La Luzerne has Orders to make the strongest Representations upon the Subject.
I am not certain whether his Excellency means that such Orders were sent so long ago, as to have reached the hand of the Minister at Congress, or whether they have been lately expedited; if the latter I submit it to your Excellency, whether it wou'd not be expedient to request that those Orders may be stopped until proper Representations can be made at Court; to the end that if it can be made to appear, as I firmly believe it may, that those Orders were given upon Misinformation, they may be revoked, otherwise sent on.2
Your Excellency will excuse this because it appears to me a matter of very great Importance. The Affair of our Paper is sufficiently dangerous and critical and if a Representation from his Majesty shou'd be made, Advantage will not fail to be taken of it, by the Tories, and by interested and disappointed Speculators who may spread an Alarm among many uninformed People so as to Endanger the public Peace. I have the honour to be with much Respect Your Excellency's most obedient and most humble Servant.
[signed] John Adams
RC in Francis Dana's hand, signed by JA (Arch. Aff. Etr., Paris, Corr. Pol., E.-U., vol. 12); endorsed: “Juin 23.” Franklin sent this letter to Vergennes with his letter of 24 June (see note 2).
1. A copy of this letter by Francis Dana (PCC, No. 84, II, f. 413–414) is endorsed: “Copy. Letter from J Adams to doct Franklin June 23. 1780—enclosed in Mr. Adam's Letter of June 26 read Novr. 30th”; and bears Dana's notation: “(NB.) This letter was written & sent on the 22d. tho' dated by mistake the 23d.).”
2. JA presumably hoped that Franklin would make his own defense of the revaluation, but Franklin's note to Vergennes of 24 June, merely transmitted JA's letter. Franklin asked that the instructions to La Luzerne, if not already sent, be delayed until JA, not himself, offered proof “by which it will appear that those Orders have been obtained by Misinformation” (Arch. Aff. Etr., Paris, Corr. Pol., E.-U., vol. 12). Replying on 30 June, Vergennes dismissed JA's contention that La Luzerne's instructions were based on erroneous information and refused to modify them (Wharton, ed., Dipl. Corr. Amer. Rev., 3:827).
{ 460 }

Docno: ADMS-06-09-02-0280-0003

Author: Adams, John
Recipient: Vergennes, Charles Gravier, Comte de
Date: 1780-06-22

To the Comte de Vergennes

[salute] Sir

I have received this day the letter which your Excellency did me the honour to write me on the Twenty first Day of this Month.
I thank your Excellency for the Confidence, which induced you to communicate this letter to me, and the continuance of which I shall ever study to deserve. When your Excellency says that his Majesty's Minister at Congress, has already received Orders to make Representations against the Resolutions of Congress of the Eighteenth of March, as far as they affect his Subjects, I am at a loss to know with certainty, whether your Excellency means only that such Orders have lately passed, and are sent off to go to America, or whether you mean that such Orders were sent so long ago, as to have reached the hand of the Chevalier De La Luzerne. If the latter is your Excellency's meaning, there is no Remedy; if the former, I wou'd submit it to your Excellency's Consideration whether those Orders may not be stopped and delayed, a little time, until his Excellency Mr. Franklin may have opportunity to make his Representations to his Majesty's Ministers; to the end that if it should appear that those Orders issued in Consequence of Misinformation, they may be revoked, otherwise sent on. I will do myself the Honor to write fully to your Excellency upon this Subject without loss of time; and altho' it is a subject in which I pretend not to an accurate Knowledge in the Detail, yet I flatter myself I am so far master of the principles, as to demonstrate that the Plan of Congress is not only wise but just.1 I have the honour to be with the greatest Respect Your Excellency Most obedient and most humble Servant.
[signed] John Adams
RC in Francis Dana's hand (Arch. Aff. Etr., Paris, Corr. Pol., E.-U., vol. 12); endorsed: “M. de R.”; “Juin 22.”; “M. John Adams”; and “accuse la reception de la lettre de 21 Juin que le ministre lui a ecrité.” LbC dated 23 June (Adams Papers); notation: “23 by mistake. 22d. in fact.” JA thought that the recipient's copy had also been dated 23 June, as is evident by the first sentence of his second letter to Vergennes of the 22d (below).
1. Compare this description of the resolution of 18 March with that in the second paragraph of Leray de Chaumont's account of his conversation with JA on 15 June (Chaumont to Joseph Mathias Gérard de Rayneval, 16 June, above).

Docno: ADMS-06-09-02-0280-0004

Author: Adams, John
Recipient: Vergennes, Charles Gravier, Comte de
Date: 1780-06-22

To the Comte de Vergennes

[salute] Sir

I this day acknowledged the Receipt of the Letter which you did { 461 } me the honor to write me on the 21st. by mistake I dated my Letter on the twenty third.1
I have the Honor to agree with your Excellency in Opinion that it is the Intention of Congress to redeem all their paper Bills which are extant at an Exchange of Forty for one; by which means the two hundred Millions of Dollars which are out, will be reduced to about Five Millions.
I apprehend with your Excellency that it was necessary for the Congress to put themselves in a Condition to defray the public Expences, They found their Currency so depreciated, and so rapidly depreciating, that a further Emission sufficient to discharge the public Expences another Year; would have probably depreciated it to two hundred for one, perhaps would have so depreciated it that nobody would have taken it at any Rate, it was absolutely necessary then to stop emitting, yet it was necessary to have an Army to save their Citys from the Fire, and their Citizens from the Sword, that Army must he fed, cloathed, paid and armed, and other Expences must be defrayed. It was become necessary therefore at this time, to call in their paper, for there is no Nation that is able to carry on War by the Taxes which can be raised within the Year; but I am far from thinking that this Necessity was the Cause of their calling it in at a depreciated Value, because I am well convinced they would have called it in at a depreciated Value, if the British Fleet and Army had been withdrawn from the United States, and a general Peace had been concluded. My Reason for this Belief is the evident Injustice of calling it in at its nominal Value, a silver Dollar for a paper one. The Public has its Rights as well as Individuals theirs, and every Individual has his Share in the Rights of the public. Justice is due to the Body politic, as well as to the Possessor of the Bills, and to have paid off the Bills at their nominal Value would have wronged the Body politic of thirty nine Dollars in every Forty, as really as if Forty Dollars had been paid for one, at the first Emission in one thousand seven hundred and seventy five, when each Paper Dollar was worth and would fetch a silver one.
I beg Leave to ask your Excellency whether you judge that the Congress ought to pay Two hundred Millions of silver Dollars for the two hundred Millions of paper Dollars that are abroad? I presume your Excellency will not think that they ought, because I have never met with any Man in Europe or America that was of that Opinion. All agree that Congress ought to redeem it at a depreciated Value, the only Question then is, at what Depreciation. Shall it be at seventy { 462 } five, Forty, Thirty, Twenty, Ten or five for One? After it is once admitted that it ought to be redeemed at a less Value than the nominal Value, the Question arises, at what Value? I answer there is no other Rule of Justice than the Current Value. The Value at which it generally passes from Man to Man. The Congress have set it at forty for one, and they are the best Judges of this, as they represent all parts of the Continent where the paper circulated.
I think there can be little need of Illustration, but two or three Examples may make my Meaning more obvious. A Farmer has now Four thousand Dollars for a pair of Oxen he sells to a Commissary to subsist the Army. When the money was issued in seventeen hundred and seventy five2 he would have been glad to have taken one hundred Dollars. A Labourer has now Twenty Dollars a day for his Work, five years ago he would have been rejoiced to have received half a Dollar, the same with the Artisan Merchant and all others, but those who have fixed Salaries and Money at Interest. Most of these Persons would be willing to take hard Money for his Work and his Produce, at the Rate he did six Years ago. Where is the Reason then, that Congress should pay them forty times as much as they take of their Neighbor in private Life?
The Amount of the ordinary Commerce external and internal of a Society may be computed at a fixed Sum, a certain Sum of Money is necessary to circulate among the Society, in order to carry on their Business. This precise Sum is discoverable by Calculation and reduceable to Certainty. You may emit paper or any other Currency for this purpose, until you reach this Rule, and it will not depreciate; after you exceed this Rule it will depreciate, and no power or Act of Legislation hitherto invented, can prevent it. In the Case of paper Money, if you go on emitting forever the whole Mass will be worth no more than that was which was emitted within the Rule. When the paper therefore comes to be redeemed, this is the only Rule of Justice for the Redemption of it. The Congress have fixed Five Millions for this Rule, wether this is mathematically exact, I am not able to say, whether it is a Million too little or too much, I know not, but they are the best Judges, and by the Account of the Money being seventy for one and Bills of Exchange fifty five for one, it looks as if Five Millions was too high a Sum rather than too small. It will be said that the Faith of Society ought to be sacred, and the Congress have pledged the public Faith for the Redemption of the Bills at the Value on the Face of them. I agree that the public Faith ought to be sacred, but who is it that hath violated this Faith? Is it not every Man who { 463 } has demanded more paper Money for his Labour or Goods, than they were worth in Silver. The public Faith in the Sense these Words are here used, would require that Congress should make up to every Man who for five Years past has paid more in paper Money for any thing he purchased, than he would have had it for in Silver. The public Faith is no more pledged to the present possessor of the Bills, than it is to every Man thro' whose hands they have passed at a less Value than the nominal Value, so that according to this Doctrine, Congress would have two hundred Millions of Dollars to pay to the present possessors of the Bills, and to make up to every Man thro' whose hands they have passed, the Difference at which they passed between them and Silver.
It should be considered that every Man, whether a native or foreigner, that receives or pays this Money at a less Value than the nominal Value, breaks this Faith; for the social Compact being between the whole and every Individual, and between every Individual and the whole, every Individual, Native or Foreigner who uses this Paper, is as much bound by the public Faith to use it according to the Tenor of its Emission, as Congress are. And Congress has as good right to reproach every Individual who now demands more Paper for his Goods than Silver, with a breach of the public Faith, as he has to reproach the public or their Representatives.3 I must beg your Excellency's Excuse for calling your Attention a little longer to this head of public Faith, because I cannot rest easy while my Country is supposed to be guilty of a breach of their Faith, and in a Case where I am clear they have not been so, especially by your Excellency, whose good Opinion they and I value so much. This public Faith is in the Nature of a mutual Covenant, and he that would claim a Benefit under it, ought to be carefull in first fulfilling his part of it. When Congress issued their Bills declaring them in effect to be equal to Silver, they unquestionably intended they should be so consider'd, and that they should be received accordingly. The People, or Individuals, covenanted in effect to receive them at their nominal Value, and Congress in such Case agreed on their part to redeem them at the same Rate. This seems to be a fair and plain Construction of this Covenant, or public Faith, and none other I think can be made that will not degenerate into an unconscionable Contract, and so destroy itself. Can it be supposed that Congress ever intended, that if the time should come, when the Individuals refused to accept and receive their Bills at their nominal Value, and demanded and actually received them at a less Value, that in that Case the Individual should { 464 } be entitled to demand and receive of the public, for those very Bills, Silver equal to their nominal Value? The Consideration is in Fact made by the public at the very Instant the Individual receives the Bills at a Discount, and there is a tacit and implied Agreement springing from the Principles of natural Justice or Equity, between the public and the Individual, that as the latter has not given to the former a Consideration equal to the nominal Value of the Bills, so in fact, the public shall not be held to pay the nominal Value in Silver to the Individual. Suppose it otherwise, and how will the Matter stand? The Public offers to an Individual a Bill whose nominal Value is for Example Forty Dollars, in lieu of Forty silver Dollars, the Individual says I esteem it of no more Value than one silver Dollar, and the public pays it him at that Value, yet he comes the next day when the Bill may be payable, and demands of the public Forty silver Dollars in Exchange for it, and why? because the Bill purports on the Face of it, to be equal to forty silver Dollars: The Answer is equally obvious with the Injustice of the demand. Upon the whole, as the Depreciation crept in gradually, and was unavoidable, all Reproaches of a breach of public Faith ought to be laid aside, and the only proper Enquiry now really is, What is the Paper honestly worth? What will it fetch at Market? And this is the only just Rule of Redemption.4
It becomes me to express myself with deference when I am obliged to differ in Opinion from your Excellency, but this being a Subject peculiar to America, no Example entirely similar to it, that I know of, having been in Europe, I may be excused therefore in explaining my Sentiments upon it.
I have the Misfortune to differ from your Excellency so far as to think, that no general Distinction can be made between Natives and Foreigners, for not to mention that this would open a Door to numberless Frauds, I think that Foreigners when they come to trade with a Nation, make themselves temporary Citizens, and tacitly consent to be bound by the same Laws. And it will be found that Foreigners have had quite as much to do in depreciating this Money, on proportion as Natives, and that they have been in proportion much less Sufferers by it. I might go further, and say that they have been in proportion greater Gainers by it, without suffering any considerable Share of the Loss.
The Paper Bills out of America are next to nothing, I have no Reason to think there are ten thousand Dollars in all Europe, indeed I don't know of one thousand.
The Agents in America of Merchants in Europe, laid out their paper { 465 } Bills in Lands, or in Indigo, Rice, Tobacco, Wheat, Flour &c. in short in the produce of the Country, this produce they have shipped to Europe sold to the King's Ships, and received Bills of Exchange, or shipped to the West India Islands where they have procured them Cash or Bills of Exchange; the Surplus they have put into the Loan Offices from time to time, for Loan Offices have been open all along from seventeen hundred and seventy Six5 to this time. Whenever any Person lent paper Bills to the Public, and took Loan Office Certificates, he would have been glad to have taken Silver in Exchange for the Bills6 at their then depreciated Value. Why should he not be willing now? Those who lent Paper Dollars when Forty were worth but one, will have one for Forty, and those who lent when Paper was as good as Silver, will have Dollar for Dollar.
Your Excellency thinks it would be hard that those who escaped the perils of the Seas and of Enemies, should be spoiled by their Friends, but Congress have not spoiled any. They have only prevented themselves and the public from being spoiled. No Agent of any European Merchant in making his Calculations of profit and Loss ever estimated the depreciated Bills at the nominal Value. They all put a profit upon their Goods sufficient to defray all Expences of Insurance, Freight, and everything else, and had a great profit, besides, receiving the Bills at the current and not the nominal Value.
It may not be amiss to state a few prices current at Boston the last and present Year in Order to show the profits that have been made.
Bohea Tea Forty sols a pound at L'Orient and Nantes, Forty five Dollars.
Salt (which is very little in Europe) used to be sold for one shilling a Bushell Forty Dollars a Bushel and in some of the States two hundred Dollars at times.
Linnen (which cost two Livres a yard in France) Forty Dollars per yard.
Broad Cloth, a Louis d'or here, Two hundred Dollars per yard.
Ironmongery of all sorts One hundred and twenty for one.
Millinery of all sorts at an Advance far exceeding.7
These were the prices at Boston and at Philadelphia, and in all the other States they were much higher.
These prices I think must convince your Excellency that allowing one half or even two thirds of the Vessels to be taken, there is Room enough for a handsome profit deducting all Charges and computing the Value of the Bills at the Rate of Silver at the time.
There are two other Sources from whence Foreigners have made { 466 } great profit, the difference between Bills of Exchange and Silver during the whole of our History, when a Man could readily get twenty five paper Dollars for one in silver, he could not get more than twelve paper Dollars for one in a Bill of Exchange. Nearly this proportion was observed all along as I have been informed. The Agent of a foreign Merchant had only to sell his Goods for paper, or buy paper with Silver at twenty five for one, and immediately go and buy Bills at twelve for one, so that he doubled the Value of his Money in a Moment. Another Source was this, the paper was not alike depreciated in all places at the same time, it was forty for one at Philadelphia sometimes when it was only Twenty at Boston. The Agent of a foreign Merchant had only to sell his Goods, or send Silver to Philadelphia, and exchange it for paper, which he could lay out at Boston for twice what it cost him, and in this way again double his property. This depreciating Currency being therefore a fruitfull Source for Men of penetration to make large profits, it is not to be wonder'd that some have written alarming Letters to their Correspondents.
No man is more ready than I am to acknowledge the Obligations we are under to France, but the flourishing State of her marine and Commerce, and the decisive Influence of her Councils and Negotiations in Europe, which all the World will allow to be owing in a great Measure to the Seperation of America from her inveterate Enemy, and to her new Connection with the United States, show that the Obligations are mutual; and no foreign Merchant ought to expect to be treated in America better8 than her native Merchants, who have hazarded their property thro' the same perils of the Seas and of Enemies.
In the late province of Massachusetts Bay from the Years seventeen hundred and forty five to seventeen hundred and fifty, we had full Experience of the Operations of paper Money. The province engaged in expensive Expeditions against Louisbourg and Canada which occasioned a too plentiful Emission of paper Money, in Consequence of which it depreciated to seven and half for one. In seventeen hundred and fifty the British Parliament granted a Sum of Money to the province to reimburse it, for what it had expended more than its proportion, in the general Expence of the Empire. This Sum was brought over to Boston in Silver and Gold, and the Legislature determin'd to redeem all their paper with it, at the depreciated Value.9 There was a similar Alarm at first, and before the Matter was understood, but after the People had time to think upon it, all were satisfied to receive Silver at Fifty shillings an Ounce, altho' the Face of the { 467 } Bills promised an Ounce of Silver for every six shillings and Eight pence. At that time the British Merchants were more interested in our paper Money in proportion than any Europeans now are,10 yet they did not charge the province with a Breach of Faith, or stigmatize this as an Act of Bankruptcy, on the contrary, they were satisfied with it.11 In proof of this last Assertion I would beg Leave to remind your Excellency that at that time the Laws of Massachusetts were subject, not only to the Negative of the King's Governor, but to a Revision by the King in Council, and were there liable to be affirmed or annulled; and from the partial preference which your Excellency well knows was uniformly given to the Interest of the Subjects of the King within the Realm, when they came in Competition with those of the Subjects in the Colonies, there is no Reason to doubt that if that Measure when thoroughly considered had been unjust in itself, but the Merchants of England would have taken an Alarm and procured the Act to be disallowed by the King in Council, yet the Merchants of England who well understand their own Interest, were quite silent upon this Occasion, and the Law was confirmed in the Council, nor can it be supposed to have been confirmed there in a Manner unnoticed. It had met with too much Opposition among a certain Set of interested Speculators in the then province, for that Supposition to be made. And the Case of the British Merchants at that time differed in no Respect from the present Case of the French, or other foreign Merchants, except that the Credits of the former were vastly greater, and they must have consequently been more deeply interested in that Measure of Government, than the latter are in the present one, their Acquiescence in the Measure and the Confirmation of that Act must be rested upon the full Conviction of the British Administration and of the Merchants, of the Justice of it.
Your Excellency will agree in the Difficulty of making any Distinction between the French Merchant and the Spanish or Dutch Merchant, by any general Rule, for all these are interested in this Business.12
Your Excellency is pleased to ask whether I think these proceedings of Congress proper to give Credit to the United States, to inspire Confidence in their Promises, and to invite the European Nations to partake the same Risques to which the Subjects of his Majesty have exposed themselves.
I have the Honor to answer your Excellency, directly and candidly, that I do think them proper for these Ends, and I further think them the only Measures that ever could acquire Credit and Confidence to { 468 } the United States. I know of no other just Foundation of Confidence in Men or Bodies of Men, than their Understanding and their Integrity, and Congress have manifested to all the World by this plan, that they understand the Nature of their paper Currency, that its Fluctuation has been the grand Obstacle to their Credit, and that it was necessary to draw it to a Conclusion in Order to introduce a more steady Standard of Commerce, that to this End the Repeal of their Laws which made paper a Tender and giving a free Circulation to Silver and Gold was necessary. They have further manifested by these Resolutions, that they are fully possessed of the only principle there is in the Nature of things, for doing Justice in this Business to the public and to Individuals, to Natives and to Foreigners, and that they are sufficiently possessed of the Confidence of the People, and there is sufficient Vigour in their Government to carry it into Execution.
Notwithstanding all, if any European Merchant13 can show any good Reason for excepting his particular Case from the general Rule, upon a Representation of it to Congress, I have no doubt they will do him Justice.
Moreover if his Excellency the Chevalier de la Luzerne can show that the Sum of Five Millions of Dollars is not the real worth of all the paper Money that is abroad and that ten Millions of Dollars is the true Sum, I doubt not Congress would alter their Rule, and redeem it at Twenty for One, But I doubt very much wether this can be shown.14
But I cannot see that any Distinction could be made between French Merchants and those of other Nations, but what would be very invidious and founded upon no principles. I cannot see that any Distinction can be made between Natives and Foreigners, but what would have a most unhappy Effect upon the Minds of the People in America, and be a partiality quite unwarrantable, and therefore your Excellency will see, that it is impossible for me to take any Steps to persuade the Congress to retract, because it would be acting in direct Repugnance to the clearest Dictates of my Understanding and Judgement of what is right and fit.15 I cannot excuse myself from adding that most of the Arms, Ammunition and Cloathing for the Army have been contracted for here by the Ministers of Congress and paid for or agreed to be paid for here in Silver and Gold. Very little of these Articles have been shipped by private Adventurers. They have much more commonly shipped16 Articles of Luxury of which the Country did not stand in need, and upon which they must have made vast profits.
{ 469 }
Thus have I communicated to your Excellency my Sentiments, with that Freedom which becomes a Citizen of the United States intrusted by the Public with some of its Interests. I entreat your Excellency to consider them as springing from no other Motives than a strong Attachment to the Union of the States, and a desire to prevent all unnecessary Causes of Parties and Disputes, and from a desire not only to preserve the Alliance in all its Vigor, but to prevent everything, which may unnecessarily oppose itself to the Affection and Confidence between the two Nations, which I wish to see encreased every day, as every day convinces me more and more of the Necessity that France and America will be under, of cherishing their mutual Connections.
I have the Honor to be with the greatest Respect Your Excellencys Most Obedient and most humble Servant.
[signed] John Adams
RC in Jonathan Loring Austin's hand (Arch. Aff. Etr., Paris, Corr. Pol., E.-U., vol. 12); endorsed: “1780. Juin 22. Envoyé copie à M. le Chevr. de la Luzerne le 7. Août No. 8.” Preceding the recipient's copy in the French archives is a French translation endorsed: “M. John Adams justiffie [ . . . ] eration du Congrès sur la depreciation du [pa]pier monnoye [I]l pretend que l'etat [ . . . ] de la marine [de] france est du à [al]liance faite avec [les] Etats unis.” LbC, with passages in Francis Dana's hand (Adams Papers). This is the first letter for which there is evidence of a substantive collaboration between JA and Francis Dana on a communication with the French government, and it is worth noting that in his contributions Dana was even more adamant than JA in justifying Congress' action. The Letterbook copy was a draft and contains numerous deletions and insertions, the most significant of which are indicated in the notes.
1. When he drafted this letter in the Letterbook, JA noted that the Letterbook copy of his first letter to Vergennes of 22 June was dated the 23d. The recipient's copy, however, was dated the 22d (above).
2. In the Letterbook JA wrote “1765,” which either Francis Dana or John Thaxter changed to “1775.”
3. In the Letterbook the following eleven sentences, through the words “Upon the whole,” are in Francis Dana's hand. They were written at the end of the Letterbook copy and marked for insertion here.
4. To this point the letter is a general explanation of the operation of monetary systems and a justification for Congress' revaluation of its currency, the “abstract reasonings, hypotheses, and calculations” that Vergennes so objected to in his letter of 29 June to Benjamin Franklin (Wharton, ed., Dipl. Corr. Amer. Rev., 3:827). The remainder of the letter ostensibly tries to justify JA's view that Frenchmen should not be excluded from the effects of the revaluation, but is really a commentary on Franco-American relations that goes far beyond the issue at hand. See the Editorial Note, 16 June – 1 July (above).
5. In the Letterbook JA wrote “1766,” which either Dana or Thaxter changed to “1776.”
6. In the Letterbook, Dana interlined the preceding five words.
7. In the Letterbook this sentence is followed by the canceled passage: “Small Articles Such as sewing silks, Tapes, Bindings, Threads, Needles, Pins &c. 300 for 1.”
8. In the Letterbook the remainder of this sentence is by Francis Dana and replaces the canceled passage: “than the natives are treated any more than an American [ . . . ] has a right to expect to be exempted from the general Laws of the Kingdom.”
9. JA refers to the General Court's adoption on 26 Jan. 1749 of “An act for drawing in the bills of credit of the several denominations . . . and for ascertaining the rate of coin'd silver in this province for the future.” That act { 470 } was supplemented on 18 Jan. 1750 and 26 April 1751 by additional acts that further defined the conditions under which the paper money would be redeemed. The original act was approved by the King in Council on 28 June 1749, and in September £175,240 9s. 22d. in silver and copper coins reached Boston (Mass., Province Laws, 3:430–441, 454–462, 480–481, 554–556; Andrew M. Davis, Currency and Banking in the Province of Massachusetts Bay, N.Y., 1901, p. 233–252; see also William Gordon's letter of 8 March, note 5, above).
10. In the Letterbook the remainder of this sentence is by Francis Dana and replaces a sentence that reads “Yet the British Merchants were not dissatisfied.”
11. In the Letterbook the remainder of this paragraph was written by Dana at the end of the Letterbook copy and marked for insertion at this point.
12. In the Letterbook the following two paragraphs were written by JA at the end of the Letterbook copy and marked for insertion at this point.
13. At this point in the Letterbook is the canceled passage: “can [present to?] Congress that he has kept Money in Europe, or that his Agent has kept it in America—in short.”
14. In the Letterbook this paragraph was originally the next to last paragraph in the letter. The original closing paragraph was deleted and, with cancelations done during the original drafting indicated, reads: “I hope I have made myself understood by your Excellency, and am sorry I <could not be shorter> have <been so lon> detained you so long. I have the Honour to be, &e.” The following three paragraphs, including the closing, were written by JA below the original closing and marked for insertion at this point, but see note 15.
15. In the Letterbook, to this point, this paragraph was written immediately following the canceled closing, but here the passage in the Letterbook was marked for the insertion of the remainder of the letter's text which was written by JA following the material intended to be inserted at note 12.
16. In the Letterbook the remainder of this sentence is by Francis Dana and replaces the canceled passage: “[ . . . ] and Trifles to America, which We should be better, without, because they made a greater Profit upon them.”

Docno: ADMS-06-09-02-0280-0005

Author: Adams, John
Recipient: Gerry, Elbridge
Date: 1780-06-24

To Elbridge Gerry

[salute] Dear Sir

Your two Letters of the 5th. of May1 I have recieved with more pleasure than You can imagine. They are the first Lines I have recieved from Philadelphia. Your Letter prepared my mind for the horrid History We have since recieved in the Court Gazette from London of the Surrender of Charlestown.2 This is the severest Blow We ever recieved. Yet We shall soon get over it. I hope it will arouse the thoughtless from their pleasing Dreams of Peace—for notwithstanding the distracted State of the three Kingdoms, they still dream of unconditional Submission. I know not to what Extent in the Country Clinton will be able to extend his arms. I hope he will be cooped up.
The Resolutions of Congress, for calling in their paper, have spread an Alarm here, which has cost me much Pains to allay. I am afraid the Court has taken too sudden a Step, in ordering the Chevalier de { 471 } la Luzerne to represent against the Plan: it is certainly founded upon the only principles of Justice and sound Policy.
Your Plans of Oeconomy will be found a Treasure to You—many articles of needless Expence may be cut off. If Mr. Laurens was in Holland, I am told he might borrow Money. I have no Authority You know, to attempt it. Mr. Laurens the father's delay, and his Son's Refusal have been great Misfortunes to Us. Military Stores and Cloathing I hope will arrive soon.
Congress adjourning for want of Business, is quite a Novelty.3 I never once saw such a Phenomenon.
The Resolution to pay off the Certificates according to the Value of Money at the Time of the Emission, compleats your plan and makes the whole just. But it would have been better if this had been published with those of the 18th. of March. Your Letter gave Us the first Notice of it.
I have a Bushel of Letters on Board the Alliance—many of them have been there four Months. She is said to be taking in Stores. She will be the last Frigate I hope, which will ever be put under the Command of any Body in Europe. If You send a Frigate on an Errand, give her her Orders to return. The Code of Laws, is not sufficient for the Government of Officers or Men here. There are never officers enough to compose a Court Martial, and there is an End of all Discipline, Order and Decency when Disputes and Quarrels and Crimes arise and there is no Authority adequate to the Decision of the former and the Punishment of the latter. We have been plagued here eternally with disputes between Jones and his Officers—Landais and his officers—between Jones and Landais—and between one Ships Company and anothers, without a possibility of settling them. Which is right and which wrong it is impossible for any body here to know, because the only means of a fair Trial a Court Martial, is impracticable—And nobody in Europe that I know of, has the Power of Removal or Suspension of Officers.4 The Commissioners indeed gave Jones their Consent that he should leave the Ranger, but it was with the Consent of all Parties and at the Request of the Minister.5
The Gentleman6 you recommend to me, shall have all the Civilities and assistance in my Power.
My affectionate Respects where due—to the French Minister and Secretary particularly—the Comte de la Luzerne7 &c last Sunday were very well. I long to hear something to ballance Charlestown.

[salute] Adieu

[signed] John Adams
{ 472 }
RC in John Thaxter's hand (MHi: Hoar Autograph Coll.); endorsed: “Paris Leter His Excellency J Adams Esq. June 24 1780 ansd Jany 20 1781 S.”
1. Gerry's second letter of 5 May (Adams Papers) is not printed, but see James Lovell's letter of 4 May, note 1 (above).
2. This refers to the London Gazette Extraordinary of 16 June, containing Lt. Gen. Sir Henry Clinton's letter of 15 May reporting the surrender of Charleston on the 12th.
3. In his letter of 5 May (above), Gerry indicated that Congress was adjourning earlier in the day than was usual.
4. Compare JA's statement here regarding disputes among naval officers with those in his letter to Benjamin Franklin of 26 June (below).
5. See Benjamin Franklin and JA to John Paul Jones, 10 Feb. 1779 (vol. 7:398–399).
6. Dr. Hugh Shiell, who was mentioned in Gerry's second letter of 5 May (Adams Papers).
7. César Henri, Comte de La Luzerne, brother of the Chevalier.

Docno: ADMS-06-09-02-0280-0006

Author: Adams, John
Recipient: Lovell, James
Date: 1780-06-24

To James Lovell

[salute] Dear sir

Yours of 4 May is received—it is the first from Philadelphia. Mr. Mease and your Friend1 shall have all the attention and assistance I can give them. I thank you for sending the Journals by the Way of Braintree: but hope you will continue to send them from Phila. also.
Your Plan of a Cypher I cannot comprehend—nor can Dr. F. his.2
You have made me very happy, by acquainting me with Proceedings on my accounts. The Report and consequent Vote that “the several Charges in my accounts are conformable to the strictest Principles of Oeconomy, and that as far as I have been entrusted with public money, the same has been carefully and frugally expended” does me great Honour. But I cannot live so Oeconomically now, and I have not received the orders you promised me, to draw. Pray what am I to do.?
Where is Laurens? Jay I hope will go on well. The Irish go on. The maritime Powers go on. The English Mobs go on. And I hope the military operations of F. and S. go on well.
But the affair of Charleston, Your Plan of Revolution in the Paper Currency which made a Noise here because it was not understood; and was misrepresented: and the disputes about the Alliance Frigate, all coming at once: agitated my Mind, more I think than any Thing ever did. But We shall do very well. I wish the Frigate was away. I have explained the affair of the Money at Court as well as I could. I am sure it is right in the main. Whether 40 for one is too little too much or exactly right I know not. In this Calculation I pin my faith on your sleeves, who know best. But of the Principles I am certain. If the Chevr. de La Luzerne remonstrates you can convince the King and him too that you are right.
{ 473 }
I shall have little to do in my celestial Character of Angelus Paies,3 I fear very soon. Yet I never was busier in all my days. I have written an hundred Letters to Congress I believe, almost. Whether you receive them I dont know. If there is any Thing wrong, or omitted, or that gives offence, let me know.
Yours affectionately.
1. Presumably Dr. Hugh Shiell. For Shiell and Robert Mease, as well as JA's later reference to the journals, Lovell's cipher, and his accounts, see Lovell's letter of 4 May, and notes (above).
2. In his letter of 4 May to Benjamin Franklin, Lovell had also enclosed a cipher (Cal. Franklin Papers, A.P.S., 2:245).
3. Angel of peace.
Cite web page as: Founding Families: Digital Editions of the Papers of the Winthrops and the Adamses, ed.C. James Taylor. Boston: Massachusetts Historical Society, 2016.
http://www.masshist.org/apde2/