Lobbying Congress for a Loan -- 1796
In the fall of 1795 the commissioners appointed by President George Washington to prepare the City of Washington for the reception of the Federal government in 1800 faced a major crisis. Thanks to the failure of three speculators from whom the commissioners expected substantial payments, there was no money available to continue work on the Capitol and President's House. With the approval of President Washington one of the three commissioners, Alexander White, came to Philadelphia to lobby Congress for funds. Two of the defaulting speculators, Robert Morris and James Nicholson, were also in Philadelphia, and White also hoped to arrange for payments from them.
Alexander White was a former congressman from Northern Virginia. He was one of the congressmen who switched votes on Hamilton's funding bill that allowed the Compromise of 1790 in which the federal government's assumption of state debts and the federal capital on the Potomac River were parts of the equation in a deal between Hamilton and Jefferson. White had been appointed to his job as commissioner in early 1795 after he left Congress, and on city affairs was beholding to his senior colleagues, Gustavus Scott and William Thornton, for guidance, but they lacked White's considerable experience with Congress.
White was the prototype for future politicians who turned their insider's connection to advantage after leaving Congress. Of course, White was still working for the government as he lobbied Congress, but the methods he used and headaches he endured are timeless. White wrote frequently to his colleagues and as best as I could, and White's handwriting was not good, I've transcribed his letters. I use a question mark in brackets where I am uncertain of a word and as you read on you'll see many [?]. There are several other documents and essays on my web page that try to explain what the founding of Washington entailed. A general overview of the founding decade is at: short.html. A discussion of the Morris, Nicholson, and Greenleaf speculation can be found at speculators.html. I will use footnotes in the letters to try explain issues to those unfamiliar with the complexities of the politics and economics of the issues White had to deal with.
Alexander White to Gustavus Scott and William Thornton
6 Dec 1795
I set out for this place agreable to expectation on Thursday mornings in the stage were Mr. Tazewell a Senator and Messr Harrison and Cabell the representatives in Congress from Va. - Mr. Bloodworth, a Senator and Mr. Franklin a representative from Carolina, a Philadelphian, a Bostonian and an Irishman - Many questions were asked with respect to the City and the Public Buildings(1), which I answered in the best manner I could with the information I possess. (I anxiously wait for further information) and placed the business in as favourable a light as I deemed consistent with truth. In my turn I inquired what sentiments the Eastern Members(2) appear to entertain of the Federal Seat, and was answered that if their sincerity could be relied on they meant to carry the measure into effect - After we arrived in Philadel I got my Countrymen(3) by themselves and explained to them the object of my Journey; they were of opinion that there were no doubt of the Southern interest, and that the Eastern members could not consistent with their avowed principles(4), do anything that would look like throwing obstructions in the way, but that they might if really disposed to counteract, find Pretexts for refusing a Grant of money. I told them, although that would be a most desirable circumstances yet it might be dispensed with, rather than fail in obtaining the Patronage of the General Government in one shape or other. I recommended that nothing should be said on the subject until the sense of the known friends of the Potowmack could be collected. When that is done I shall apply to the members of other states, endeavour [?] to make favourable impressions on their minds and as far as possible to know the part they will take. I took a Family Dinner with the President - he told me he sent an extract from our last to Mr. Morris but have not seen or heard from him since. I called on Mr. Madison in the Evening but he was not within. We had a fatiguing journey, particularly on Friday we did not get into lodgings until 2 o'clock in the Night; I take my rest on the Sabbath, but shall tomorrow commence my business, and not cease my exertions until the fate of it is known. I have taken lodgings at No 18 Chestnut Street, to which place you will please direct your letters. I am with great regard and esteem
10 Dec
Since my last of 6th instant in pursuance of the objects of my mission, I waited on Mr. Morris, and after some discourse in which he expressed great uneasiness in his present situation, and stated the exertions he had made to comply with his engagements, I mentioned to him the arranging his business in such a manner as secure the payment of smaller installments at different periods through the year. He said he was pleased with the ideas and would consider it, and consult with Mr. Nicholson on the means. He expressed a hope that in ten days he would pay me $10,000 - I then waited on Mr Nicholson. A conversation nearly similar to that with Mr. Morris took place; he invited me to dine with him the next day, which I accordingly did - he inforned me he and Mr. Morris had made arrangement for the payment of 10,000. Inquired what sums would be necessary before next May and in what proportions I would wish to divide the installments then to become due - I told him that nothing less than paying up the arrears, and a further payment of $10,000, by the first of April would enable US to open the business of the next summer. and I proposed that the future installments should be 10,000 dollars monthly - I endeavored to impress on his mind by the strongest terms I could command, the necesity of rendering the payments of these instalments absolutely certain, the mode of doing this I left to him and Mr. Morris to devise. He asked me if a credit in the Columbia Bank (5)would be satisfactory - I told him it would be perfectly so Yesterday Mr. Dandridge (6) put into my hands the letter of which a copy is amended - Neither Mr. Morris or Mr. Nicholson intimated to me an expectation of immediately paying more than $10,000 - and I never intimated to them that less than their whole arrears would be sufficient for present purposes which I of these sums Mr Morris alludes to I know not - should he make a payment my own opinion is to lodge it in the bank till it can be drawn for a discharge of one of our Bills due to the Bank of Columbia. This I expect may be done without incurring the expense of Commission to any person or risk of carriage - I wish your Sentiments on this subject - With regard to the more important object of an application to Congress I have been able to come to a decision - I have not opened the subject to any except my countrymen and Mr. Baldwin of Georgia whose candour and friendship I thought entitled him to my confidence - In some of them I discovered a strong inclination to avoid the experiment at present. They show no small displeasure at the style of the Buildings particularly the President's House and informed me, that the Spirit ran so high in N. Carolina that no countenance could be expected from that States. These sentiments I had from Mr. Giles in company with Mr. Venables who seemed to concur with him in opinion though he said less. Mr. Madison also appears rather averse to an application to Congress, and alleged that whatever the declarations of the Eastern Members out of doors may be, they may find means to elude them in the House. But by what other criterion am I to judge of their interest and should the Eastern Members pretty generally profess an inclination to promote the measure will I be justified in declining the attempt? Some others of my Countrymen are more sanguine in their expectations, and Mr. Baldwin (who is himself a Connecticut man) says that if the Eastern Members are in the same disposition this session that they were last he has no doubt of their concurrence. But it is impossible to attain absolute certainty. Shall I proceed on probable grounds? To form an opinion even of the probable event will be difficult and more tedious that any one accustomed to transacting business with large Republics conceive. Can we in fact proceed with the Buildings without Congressional aid? From the best accounts I have been able to obtain of the inconveniences of Morris and Nicholson I much doubt of their ever complying with their engagements. From whence there is money to [?] Situated as I am it is an irksome task to introduce the name of the City - I am to demand money of debtors - and yet have no documents of the debt - no statements of the accounts - I am to ask money for finishing Public Buildings and yet can give no account of the monies heretofore expended on them. Now even a [?].
14 Dec
I have just received your fav. of 10 instant. I am however without the very important accounts which will show the application of the monies heretofore expended in the Federal City - owing- as Mr. Munroe informs me, to Mr. Richmond's indisposition and Mr. Lacys being called off to other business - I must write with more earnestness than formerly for the real state of private building in the City - They are by some represented as consisting only of ten or twelve houses [?] and falling down for want of finishing. This I can and do contradict but I wish to be able to state the whole number of inhabited Houses, distinguishing brick from wood and the number of houses covered in - to make an actual ennumeration would perhaps take more time than can be spared for the purpose and render the information too late to be useful. I am told that Mr. Lear and Mr. Cranch have made an account - Yesterday morning I returned a visit to Mr. King a Senator of New York and Mr. Smith of S. Carolina. I introduced the subject of the City in a manner which laid me under the necessity of explaining my views or of showing an inclination to evade it. I preferred the former - Mr. King said explicitly that he wished to go to the Federal seat, and that it might be prepared for the reception of Congress - But that I must make the Debtors pay up. He said the Eastern Members would not do anything to defeat the measure, that they would not move to repeal the Law, but that they would not grant money. The idea having been at the time the Law passed that the Public Buildings would be erected without an expense to the U. States - and that it was worthy of consideration how far Congress would interfere actively before any proposition should be brought before them. Mr. Smith was originally against the Law, and tho' a Southern man, I do not yet consider him as very friendly. The ice being thus broke I have spoken to others - among them Mr. Murray of Maryland, who seems already of opinion that a Loan may be obtained and promises his warmest assistance - I dined with Mr. Madison yesterday also the President he still seems entertain doubts of the Eastern Members - the President [?] with him confidentially (that is Mr. Madison and myself only being present) as a Friend of the Measure - Mr. P[?] of Virginia thinks Mr. Madison will take an active part in supporting the measure should it be brought before Congress, but it would be endless to detail particular conversations. On the whole from the sentiments I have collected I feel a degree of confidence that a loan may be obtained but little or no hope of grant of money and [?] shall we go on in the meantime. I yesterday wrote Mr. Morris a note of which the annexed is a copy
To Morris
As you are much engaged in business which may occasion an interruption of our intercourse, I have concluded to make my communications by writing - and request you do the same - being ready however to wait on you personally if required. I mentioned to you but more fully to Mr. Nicholson the smallest payment which I thought would enable us to commence the Public Buildings in the Spring - viz the full payment of your arrears, and an advance of 10,000 dollars by the first of April - This advance I propose as a part of a Plan which in general seemed to meet your approbation that of dividing your future instalments into monthly payments of l0,000 dollars each. If you agree to this, and will place the payment, in a state of absolute certainty I shall return well satisfied. Mr. Nicholson mentioned a credit in the Bank of Columbia which if obtained will be unexceptionable - Punctuality of payment is our object, the means of securing that punctuality we leave to you - I hope to hear from you soon, having been more than a week in the city, I wish to see some prospect of leaving it....
21 Dec
Since my last I have from Mr. Richmond the accounts of receipts, expenditure & c. Since that period likewise I have made it my business to converse with influential characters from the Eastern states on the subject of my mission. I have given a general summary of past transactions and stated the property on hand as well worth more than a million dollars, valuing the Lots at the average price which Lots singly on in small numbers have sold, and have observed that with this property and the debts due from sales heretofore made we can certainly bring the Buildings to such a state as to secure Congress - But if this property can be retained until Congress removes or even till the Buildings are well advanced and we can procure money to carry them on with celerity, the cloud which hangs over the minds of many will be dissipated. The City will be so improved as to afford eligible accomodations for Congress and all their followers and much property remain for the use of the U States - whereas if we are obliged to bring this property to Market at this time, it will fall a pray to speculators as too much of the City has already done. The Buildings will drag on heavily - private Adventurers will be discouraged, and when Congress remove, they will find it a much less eligible place than a sufficiency of money, under the fostering hands of Government would render it. No man disputes the justice of this [?] , and the Eastern gentlemen all declare In the most unequivocal manner that they have no wish, no intention, to defeat the measure [?] of the Seat of Government, and no aversion to go thither when the time arrives. Some have impressed [?] a wish with all the appearance of sincerity that they could go now - -when the particular object of guaranteeing a loan has been mentioned, they have pretty generally observed that they see no impropriety in it, but that the thing was new, that they would consider it, and give me opinion when they had made up their minds. They unite in saying money will not be granted, and even advise me to keep it out of view. Not that they deny the strict obligation arising from the Act of Congress to finish the buildings, but they say it was understood when the Law passed that the Federal Treasury would not be called upon for money. No man from the West has yet given me his decided opinion. I thought it improper and indelicate in the first instance to press it. And I have not yet had time to converse with one third of the members. I shall proceed and have done in conversing generally with the other members and endeavor if possible to prepare their minds for a favorable reception. Madison still continues his aversion to any application being made, assigning the same reason as at first (Eastern Duplicity) if we can engage him to take a decided part it will be a great point gained. The president is extremely solicitous for the success of the business. He wishes to avoid a rash and abortive attempt, at the same time he thinks the thing ought not to be lightly abandoned. He wishes me to remain here. I cannot refuse while he desires it, though the business will soon become irksome. I do not perceive any real distinction between the monies expended in surveying the District and purchasing sites for Buildings, and that expended on the Buildings themselves. They are both required by the same Law and for the same purpose. Beside by demanding a part only we should seem to abandon the strong ground we now hold, that Congress is obliged of their [?] to complete the whole - a ground to which we may probably have occasion to resort. The observations you suggest with respect to the President's House I have frequently expressed. I believe the objection arising from that circumstance to be little more than a Pretext. The passing a Law to authorise a Loan secure on the City property had not occured to me. Is there any doubt of the existing right to do this? I have understood it was proposed when the former Loan was in agitation and even a mortgage [?] to be used eventually. The legalizing an interest above [?] might be a reason for passing a Law, if the right of Mortgage is clear. I have entertained no other idea with regard to Morris and Nicholson, than that the means of obtaining the money should be placed absolutely in our power. On Friday morning I sent Mr. Morris a note of which a copy is annexed and to which I have received no answer. Should I remain much longer in this place my own money will not take me honourably out of it the Paymaster or the Treasurer in whose hands the money ordered to be advanced to me remains will oblige me by remitting it either by a [?] on some Person here, or in Bills of some of the Banks,--
To Robert Morris
Letters from my Colleagues by the two last Posts are so [?] pressing for money to lay on supplies for next year that I cannot do other wise than mention it to you, and request that before tomorrow night, you will if possible inform me when the 10,000 dollars may with certainty be relied on; that I may [?] them by Mondays Post - they state that they have been obliged to refuse some of the most essential articles, though offered at prices which in the Spring will represent [?] double the Sum, for want of cash to pay for them
Dec 25, 1795
Proposed copy of letter from commissioners to President
Sir - contemplating the Public Buildings placed under our direction, and [?] the best mode for carrying them on with effect, we have reduced the results of our deliberations into the form of a memorial addressed to Congress which if you approve you will cause to be laid before that Body, in such manner as you shall judge proper. One of the Board will [?] further information if required
Explanations
asked by A White of articles in the List of Expenditures
- viz Wharf at the Eastern Branch 10,700.51 - City of Washington 15,311.42
are there two wharves? Where is that in the City of Washington other than the Eastern Branch & in what condition?
Capitol 78,015.29 Is this for workmanship only?
President's House 97,329.83 - is this for workmanship only or of what else do those articles [?] ?
Expense of Commissioners Office 5,895.76 - does this include salaries to commissioners clerks
Freestone Quarries - Is this sum for Purchases - do the city hold the property? and how many Quarries?
Stone quarry in the city - is that a purchase and does it belong to the city
Size of the [?] State of the Capitol wall. What is the height of the foundation story - and the height of the Freestone round the Wall at the different points, highest and lowest
Gentlemen,
I received yours of 22nd instant and Mr. Scott's by yesterdays post. I went instantly to Mr. Morris and [?] him to make an immediate advance of the 10,000 dollars so often promised, he said it was out of his powers sooner than next week, when he requested to be able to be able to furnish me with the sum. I stated the pressing necessity for a supply by next Post and asked if he could not raise 6000 even 5000 in time for it. He paused awhile and said he would try and that he would inform me by two o'clock. I returned to my Lodging, and sent both letters to the President with a note informing him that I should wait on him at half past 5 o'clock, which I accordingly did and spent two hours with him alone, much conversation passed but no means were suggested which could promise an immediate supply. The President said, if he had money he would freely advance it, but that it was as much as he could do to get along with all the money he could raise. He has lost all expectations of money from Mr. Morris. To send Morris and Nicholson Notes to Market would impose [?] the distrust of the City at this critical period and after all might not raise 5/ on the pound and to bring suit would afford no immediate relief - it was therefore thought best to suspend coercive measures at least during the dependence of the business in Congress - and for me in the mean time to use every effort to obtain something by fair means - From Richmond's statement it appears, that on the First of [?] there was in the hands of the Treasurers and Pay Master 8596.64 allowing Col Deakins all the sums he has charged which have not been [?] to his credit, 5000 dollars due from Hopkins, 4207.91 small balances - 9420.07 due for lots sold: which with Casinaves[?] note for [?], say 1800 dollars, make upward of 29,000 dol. Besideg Harbaugh, Lee, Deakins and Casinaves Note for 10,533.33, which I never rightly understood why it is not strictly Payable. With these means (slender indeed) cannot the City be saved saved from immediate disgrace, and perhaps from final ruin by the advances of its Friends of such sums as may be absolutely necessary, till debts can be collected or property sold for their reimbursement? To say that it cannot be done will hardly gain credit with any well informed men but if those who are so deeply interested will remain inactive? I see no [?] . With respect to National Faith mentioned in your letter, there has been no reason for argument, every Gentleman acknowledges that principle in its utmost latitude and declaring unequivocally that no intention, no wish exists to repeal or defeat the Law fixing the permanent Seat of Government and many declaring that they are desirous of going there, and doing everything that is reasonable to promote the measure. Mr. Morris sent me no message yesterday but asked me to dine with him today - I will conclude [?] in the mean time I have no flattering expectations - have there been any lots sold N. of Massachusetts Avenue? if so I wish to know the prices do not Governor [?] lots by in that part of the City - I dined with Mr. Morris agreeably to invitation. He called me aside before dinner and told me, that he had got unexceptionable Notes, but as it was so late yesterday before he could obtain them, that he could not do anything with them, but that he would go early in the morning to the Grinding Mill (as he calls the Brokers Office) and get them discounted in time to go by the Post. if possible. I shall keep my letter open till that time, and if it goes empty, you will probably concur with me in opinion that there is nothing to be expected from that Quarter. Mr. M [?] hearing of the [?] in his [?] respecting the Navigation of the Patowmack above Alexandria applied to me for the means of arresting it. If Mr. Dermott has finished the soundings I should wish to have his reports that Mr. Morris's[ ]? , may appear to be founded on good authority - the distance from the mouth of the Eastern Branch to Lot 1131, and from there to the Bridge I wish likewise to know. I write Mr. Scott & Thornton by Mr. who is to set out today for the City as he informed me. The Post Horse approaches I will therefore conclude my letter with etc
1. At this time the "Public Buildings" were the Capitol and President's House
2. Which is to say congressmen from east of New York or New Englanders. During the debate over where to place the federal capital they generally opposed going south of Philadelphia
3. In the parlance of the time a "countryman" was someone from your home state, in this case Virginia
4. This probably refers to their warmhearted support for Washington's administration
5. This was the local Washington bank and essential source of immediate credit for the commissioners
6. President Washington's secretary.
There are, of course, many more letters, which I will get to in time. Please let me know of your interest. This page is maintained by Bob Arnebeck who can be reached at mailto: arnebeck@northnet.org
Philadelphia, November 9, 1795.
Dear Sir: Your two Letters of the 31 ulto. have been recd. one by the post, the other by Mr. Hadfield: and expecting that this will find you in the federal City, I shall, being much engaged at this time refer you to my official letters to the board; as well on the proposed application for a Loan to the Legislature of Maryland, as on the case of Mr. Hadfield. A private letter of mine of the 4 inst, followed my official one on the first of these subjects: both of which you will see.
If the movements in Maryland are conducted with intelligence, the probable issue of the measure with the legislature of that State may be ascertained before any direct application or commitment is hazarded: and as a Loan is of the utmost importance, two strings may be better than one. The first, in the manner suggested, before the meeting of Congress, if it succeeds, the other may be reserv'd as a dernier resort. if it will not bear to be touched, then there is no other alternative than an application to Congress, a suspension of the plan, or a forced (and most certainly a depreciated) Sale; which tho' slower in its operation, will as effectually work the destruction of it. Of the three, there can be no hesitation in preferring the first of these alternatives. With esteem etc.