MEMOIRS OF THE FEDERAL ADMINISTRATIONS. CHAPTER I. FIFTH CONGRESS-SECOND SESSION. FROM WILLIAM SMITH. LISBON, August 24, 1797. Dear Sir, I flatter myself that you will hear with much pleasure of my safe arrival here, after a passage of twenty-seven days from the Capes of Delaware. We suffered no accident at sea, or delay, except of about two hours, to undergo an examination from a small French squadron, which after a visit, allowed us to pass unmolested. By some papers which I transmit to Col. Pickering by this opportunity, it appears there is a practice of counterfeiting American sea letters and registers. The consul informs me that he believes the practice is very extensive and requires a prompt remedy; he knows of an English vessel provided with an unlawful sea letter, purporting to be an American one, which was once examined by a French privateer and suffered to proceed on her voyage, for which valuable service, the captain of the vessel was rewarded by the owners with the sum of thirty pounds. I have desired him to collect all the information he can on this subject, which shall be at once transmitted. I understand this would be a very excellent market for our tar, if it were manufactured with more care; a vast quantity of Swedish tar is bought and that of the United States is rejected, because it is badly made, being mixed with sand, or otherwise unfit for market. This is deserving of your attention. Mr. Steele may perhaps communicate this subject to some of his friends in North Carolina. Flour is sometimes admitted here, and even rice has found a good market, owing to the loss of so many Brazil ships. The French have made dreadful havoc among them. We have no certain accounts from Lisle, and rumours vary every day on the subject of peace. What think you of Talleyrand's appointment? what effect will it produce on our affairs? I am in hopes that the want of money and union in France, will bring about peace; the present moment appears favourable to England. The government of Portugal have been obliged to issue a paper currency, in order to defray the expenses incurred by their preparations for defence. They have equipped a squadron and raised a considerable land force. The sum issued is a million and a half of dollars, payable at the treasury at the end of a year, with 6 per cent. interest. They are a tender in law, and are already in extensive circulation without any depreciation. As there are neither banks nor any other paper currency; these bills, if they maintain their credit, will be very convenient as a medium of negotiation. I cannot be so unreasonable as to expect to hear often from you, because I know how much your valuable time is pre-occupied ; and yet, I cannot help suggesting how much I shall be gratified by hearing frequently from you. Your letters will always be extremely interesting, whether they refer to any general subjects, or to the department which flourishes under your administration, and in the prosperity of which I have always felt more than a full share of satisfaction. The friendship with which you have honoured me, I shall always remember with the liveliest sensations, as well as the very many proofs you have given me of it. With the sincerest regard, I am, dear sir, your most obedient servant, WILLIAM SMITH. FROM RUFUS KING. LONDON, Oct. 24, 1797. Dear Sir, We are not informed how the negotiation in Italy has ended, nor indeed, are we sure that it may not be still continued. That with this country is entirely broken off. And it is here hoped that a like result may have attended the conferences at Udina. The war between England and France is to go on, and it is probable that the war with the Emperor will recommence. But what is to be our situation? Our envoys are still at Paris, but not a lisp has transpired from whence we can form any opinion respecting the result of their mission. According to the short rules by which business is done at Paris, we may expect very soon to hear from them; not because they like us, but because their hatred to this country is extreme. I have never been convinced that they would go to war with us. There are however, causes, and in the present situation of France, very powerful ones, which have a great influence to induce them to go to war with us. I hope sincerely, that we may remain at peace, but our situation is too critical not to prepare, and that in earnest, for a war. The late naval victory has raised, and will contribute to support the natural courage of England, which the repeated efforts of the administration to conclude a peace, have lowered much more than has perhaps been imagined. Farewell. Yours, very truly, R. K. TO GEORGE WASHINGTON. PHILADELPHIA, Nov. 24, 1797. After a painful and inconvenient dispersion, the public officers have returned to this city and resumed business. Congress has at length formed; the President's speech at the opening of the session, is enclosed. It is certain that the envoys have reached Paris. The report that they have been referred to Fauchet and Adet, is not confirmed, though by many it is considered as probable. A Mr. Barker offered me five hundred dollars, a few days since, on account of a debt due to you by Mr. Shreve; if you are pleased so to direct, I will receive and remit you the money. Mr. Ross, to whom this business was referred, has not arrived. I repeat, that nothing will give me more pleasure, than to be able to render any services which you may be pleased to require. With the most perfect respect to yourself and Mrs. Washington, in which I am joined by Mrs. Wolcott, I remain your faithful and assured serv't. The 13th of November was the time appointed for the meeting of Congress, but owing to fears of the sickness in Philadelphia, a quorum was not formed for some days after. The recurrence of this epidemic, and the inconvenience of convening the Legislature at any other place than the seat of government, were adverted to in the speech, and the President suggested that the law of 1794 should be so amended as to admit the postponing of the session without passing the constitutional limit. A bill introduced for this purpose, however, failed. The speech was delivered on the 23d, and contained the usual summary of events. The arrival of the envoys in Europe was announced. Nothing, it was said, had occurred since the adjournment, which rendered unnecessary the precautionary measures recommended at the opening of the last session. A manifestation of energy and unanimity was advised as the most likely means of contributing to the preservation of peace. Whatever might be the result of the negotiations, and whether the war in Europe continued or not, a speedy restoration of public order could not be soon expected, so long and so deeply had the state of society been disturbed. Protective measures for our commerce, were therefore, at all events necessary. On this subject, the language of the speech was explicit and earnest. In regard to Spain, the difficulties arising from the delay of the au thorities to withdraw the garrisons from posts within our territories continued, and the running of the boundary line had not been commenced. In connection with this. state of things, it was mentioned that foreign agents were busy on the western frontier, intriguing among the Indians, exciting them to form a confederacy, and preparing them for war against the United States. To obviate the consequences of these efforts, a law providing adequate. punishments was necessary. The progress of the different boards of Commissioners under the British treaty, in their respective business, was adverted to. Several decisions had been made under the 7th article, and the awards paid. A provision would be necessary on the part of the United States, for compensation to British subjects, under the 6th article. Upon the subject of finances, the President urged the prevention of any accumulation of the national debt, and that the defence of the country, as well as the support of government, should be provided for as much as possible, by immediate taxes instead of by loans. With respect to foreign policy, the sentiments of Wolcott's letter of October 18th were adopted. On the 28th, the answer of the House was agreed upon, and the several parts of the speech were referred to committees with instructions. The state of parties there, at the commencement of the session, was somewhat doubtful; on strong questions, the opposition even supposed itself to have a small, though uncertain majority. The reports of the Secretary of the Treasury to the Commissioners of the Sinking Fund, and to the House, contained a more satisfactory account of the state of the national finances than in any previous year, and had not the threatening aspect of foreign affairs rendered necessary an extraordinary expenditure, the country might have dated from this period the commencement of a steady and permanent reduction of a debt which was destined to be unfortunately increased. No further purchases of stock had been made during the year, the proceeds of the sinking fund and other appropriations having been applied to reimbursements; but besides the payments in January preceding, to the bank, the following sums had been expended in the discharge of the principal of the debt, viz: To the second instalment of six per cent. stock, Amounting to $641,674 76 880,000 00 480,000 00 $2,001,674 76 The estimates for the ordinary service for the year 1790, including the sums requisite for the payment of awards under the treaties with England and Spain, amounted to $2,423,849 96. The Secretary concluded: Though he observes with sincere satisfaction, that comprising the whole year, the revenue very considerably exceeds the estimates formed in December, 1796, and that it has been on the whole more prosperous than during any former period, yet he dares not encourage an expectation that the increase can be relied on as permanent. In particular, it will be noticed that the receipts from duties on imports and tonnage during the quarter ending September 30th, 1797, were somewhat less than in the corresponding quarter for the former year. Though this diminution may be attributed in some degree to a temporary stagnation of business in the port of Philadelphia during the last summer, yet it is to be apprehended that the revenue will, during the ensuing year, be impaired by the declension of commercial enterprise, occasioned by numerous captures and detentions of vessels of the United States." The subject of military and naval expenditures came up in February. Sundry resolutions, passed at the close of the 4th Congress, had called for information on this head, and statements were accordingly furnished in detail, showing every sum advanced from the treasury, and its ultimate application. The internal revenues were also the subject of a detailed report. A resolution had passed the House on the 6th of January, 1797, by which the Secretary of the Treasury was required "to lay before Congress, within |