BOOK III.

THE TREASURY. 1801-1813.

IN governments, as in households, he who holds the purse holds the power. The Treasury is the natural point of control to be occupied by any statesman who aims at organization or reform, and conversely no organization or reform is likely to succeed that does not begin with and is not guided by the Treasury. The highest type of practical statesmanship must always take this direction. Washington and Jefferson doubtless stand pre-eminent as the representatives of what is best in our national character or its aspirations, but Washington depended mainly upon Hamilton, and without Gallatin Mr. Jefferson would have been helpless. The mere financial duties of the Treasury, serious as they are, were the least of the burdens these men had to carry; their keenest anxieties were not connected most nearly with their own department, but resulted from that effort to control the whole machinery and policy of government which is necessarily forced upon the holder of the purse. Possibly it may be said with truth that a majority of financial ministers have not so understood their duties, but, on the other hand, the ministers who composed this majority have hardly left great reputations behind them. Perhaps, too, the very magnitude and overshadowing influence of the Treasury have tended to rouse a certain jealousy in the minds of successive Presidents, and have worked to dwarf an authority legitimate in itself, but certainly dangerous to the Executive head. Be this as it may, there are, to the present time, in all American history only two examples of practical statesmanship which can serve as perfect models, not perhaps in all respects for imitation, but for study, to persons who wish to understand what practical statesmanship has been under an American system. Public men in considerable numbers and of high merit have run their careers in national politics, but only two have had at once the breadth of mind to grapple with the machine of government as a whole, and the authority necessary to make it work efficiently for a given object; the practical knowledge of affairs and of politics that enabled them to foresee every movement; the long apprenticeship which had allowed them to educate and discipline their parties; and finally, the good fortune to enjoy power when government was still plastic and capable of receiving a new impulse. The conditions of the highest practical statesmanship require that its models should be financiers; the conditions of our history have hitherto limited their appearance and activity to its earlier days.

The vigor and capacity of Hamilton’s mind are seen at their best not in his organization of the Treasury Department, which was a task within the powers of a moderate intellect, nor yet in the essays which, under the name of reports, instilled much sound knowledge, besides some that was not so sound, into the minds of legislature and people; still less are they shown in the arts of political management,—a field into which his admirers can follow him only with regret and some sense of shame. The true ground of Hamilton’s great reputation is to be found in the mass and variety of legislation and organization which characterized the first Administration of Washington, and which were permeated and controlled by Hamilton’s spirit. That this work was not wholly his own is of small consequence. Whoever did it was acting under his leadership, was guided consciously or unconsciously by his influence, was inspired by the activity which centred in his department, and sooner or later the work was subject to his approval. The results—legislative and administrative—were stupendous and can never be repeated. A government is organized once for all, and until that of the United States fairly goes to pieces no man can do more than alter or improve the work accomplished by Hamilton and his party.

What Hamilton was to Washington, Gallatin was to Jefferson, with only such difference as circumstances required. It is true that the powerful influence of Mr. Madison entered largely into the plan of Jefferson’s Administration, uniting and modifying its other elements, and that this was an influence the want of which was painfully felt by Washington and caused his most serious difficulties; it is true, too, that Mr. Jefferson reserved to himself a far more active initiative than had been in Washington’s character, and that Mr. Gallatin asserted his own individuality much less conspicuously than was done by Mr. Hamilton; but the parallel is nevertheless sufficiently exact to convey a true idea of Mr. Gallatin’s position. The government was in fact a triumvirate almost as clearly defined as any triumvirate of Rome. During eight years the country was governed by these three men,—Jefferson, Madison, and Gallatin,—among whom Gallatin not only represented the whole political influence of the great Middle States, not only held and effectively wielded the power of the purse, but also was avowedly charged with the task of carrying into effect the main principles on which the party had sought and attained power.

In so far as Mr. Jefferson’s Administration was a mere protest against the conduct of his predecessor, the object desired was attained by the election itself. In so far as it represented a change of system, its positive characteristics were financial. The philanthropic or humanitarian doctrines which had been the theme of Mr. Jefferson’s philosophy, and which, in a somewhat more tangible form, had been put into shape by Mr. Gallatin in his great speech on foreign intercourse and in his other writings, when reduced to their simplest elements amount merely to this: that America, standing outside the political movement of Europe, could afford to follow a political development of her own; that she might safely disregard remote dangers; that her armaments might be reduced to a point little above mere police necessities; that she might rely on natural self-interest for her foreign commerce; that she might depend on average common sense for her internal prosperity and order; and that her capital was safest in the hands of her own citizens. To establish these doctrines beyond the chance of overthrow was to make democratic government a success, while to defer the establishment of these doctrines was to incur the risk, if not the certainty, of following the career of England in “debt, corruption, and rottenness.”

In this political scheme, whatever its merits or its originality, everything was made to depend upon financial management, and, since the temptation to borrow money was the great danger, payment of the debt was the great dogma of the Democratic principle. “The discharge of the debt is vital to the destinies of our government,” wrote Mr. Jefferson to Mr. Gallatin in October, 1809, when the latter was desperately struggling to maintain his grasp on the Administration; “we shall never see another President and Secretary of the Treasury making all other objects subordinate to this.” And Mr. Gallatin replied: “The reduction of the debt was certainly the principal object in bringing me into office.” With the reduction of debt, by parity of reasoning, reduction of taxation went hand in hand. On this subject Mr. Gallatin’s own words at the outset of his term of office give the clearest idea of his views. On the 16th November, 1801, he wrote to Mr. Jefferson:

“If we cannot, with the probable amount of impost and sale of lands, pay the debt at the rate proposed and support the establishments on the proposed plans, one of three things must be done; either to continue the internal taxes, or to reduce the expenditure still more, or to discharge the debt with less rapidity. The last recourse to me is the most objectionable, not only because I am firmly of opinion that if the present Administration and Congress do not take the most effective measures for that object, the debt will be entailed on us and the ensuing generations, together with all the systems which support it and which it supports, but also, any sinking fund operating in an increased ratio as it progresses, a very small deduction from an appropriation for that object would make a considerable difference in the ultimate term of redemption which, provided we can in some shape manage the three per cents, without redeeming them at their nominal value, I think may be paid at fourteen or fifteen years.

“On the other hand, if this Administration shall not reduce taxes, they never will be permanently reduced. To strike at the root of the evil and avert the danger of increasing taxes, encroaching government, temptations to offensive wars, &c., nothing can be more effectual than a repeal of all internal taxes; but let them all go and not one remain on which sister taxes may be hereafter engrafted. I agree most fully with you that pretended tax-preparations, treasure-preparations, and army-preparations against contingent wars tend only to encourage wars. If the United States shall unavoidably be drawn into a war, the people will submit to any necessary tax, and the system of internal taxation which then shall be thought best adapted to the then situation of the country may be created instead of engrafted on the old or present plan. If there shall be no real necessity for them, their abolition by this Administration will most powerfully deter any other from reviving them.”

To these purposes, in the words of Mr. Jefferson, all other objects were made subordinate, and to carry these purposes into effect was the peculiar task of Mr. Gallatin. No one else appears even to have been thought of; no one else possessed any of the requisites for the place in such a degree as made him even a possible rival. The whole political situation dictated the selection of Mr. Gallatin for the Treasury as distinctly as it did that of Mr. Jefferson for the Presidency.

But the condition on which alone the principles of the Republicans could be carried out was that of peace. To use again Mr. Gallatin’s own words, written in 1835: “No nation can, any more than any individual, pay its debts unless its annual receipts exceed its expenditures, and the two necessary ingredients for that purpose, which are common to all nations, are frugality and peace. The United States have enjoyed the last blessing in a far greater degree than any of the great European powers. And they have had another peculiar advantage, that of an unexampled increase of population and corresponding wealth. We are indebted almost exclusively for both to our geographical and internal situation, the only share which any Administration or individual can claim being its efforts to preserve peace and to check expenses either improper in themselves or of subordinate importance to the payment of the public debt. In that respect I may be entitled to some public credit, as nearly the whole of my public life, from 1795, when I took my seat in Congress, till 1812, when the war took place, was almost exclusively devoted with entire singleness of purpose to those objects.”[50]

To preserve peace, therefore, in order that the beneficent influence of an enlightened internal policy might have free course, was the special task of Mr. Madison. How much Mr. Gallatin’s active counsel and assistance had to do with the foreign policy of the government will be seen in the narrative. Here, however, lay the danger, and here came the ultimate shipwreck. It is obvious at the outset that the weak point of what may be called the Jeffersonian system lay in its rigidity of rule. That system was, it must be confessed, a system of doctrinaires, and had the virtues and faults of a priori reasoning. Far in advance, as it was, of any other political effort of its time, and representing, as it doubtless did, all that was most philanthropic and all that most boldly appealed to the best instincts of mankind, it made too little allowance for human passions and vices; it relied too absolutely on the power of interest and reason as opposed to prejudice and habit; it proclaimed too openly to the world that the sword was not one of its arguments, and that peace was essential to its existence. When narrowed down to a precise issue, and after eliminating from the problem the mere dogmas of the extreme Hamiltonian Federalists, the real difference between Mr. Jefferson and moderate Federalists like Rufus King, who represented four-fifths of the Federal party, lay in the question how far a government could safely disregard the use of force as an element in politics. Mr. Jefferson and Mr. Gallatin maintained that every interest should be subordinated to the necessity of fixing beyond peradventure the cardinal principles of true republican government in the public mind, and that after this was accomplished, a result to be marked by extinction of the debt, the task of government would be changed and a new class of duties would arise. Mr. King maintained that republican principles would take care of themselves, and that the government could only escape war and ruin by holding ever the drawn sword in its hand. Mr. Gallatin, his eyes fixed on the country of his adoption, and loathing the violence, the extravagance, and the corruption of Europe, clung with what in a less calm mind would seem passionate vehemence to the ideal he had formed of a great and pure society in the New World, which was to offer to the human race the first example of man in his best condition, free from all the evils which infected Europe, and intent only on his own improvement. To realize this ideal might well, even to men of a coarser fibre than Mr. Gallatin, compensate for many insults and much wrong, borne with dignity and calm remonstrance. True, Mr. Gallatin always looked forward to the time when the American people might safely increase its armaments; but he well knew that, as the time approached, the need would in all probability diminish: meanwhile, he would gladly have turned his back on all the politics of Europe, and have found compensation for foreign outrage in domestic prosperity. The interests of the United States were too serious to be put to the hazard of war; government must be ruled by principles; to which the Federalists answered that government must be ruled by circumstances.

The moment when Mr. Jefferson assumed power was peculiarly favorable for the trial of his experiment. Whatever the original faults and vices of his party might have been, ten years of incessant schooling and education had corrected many of its failings and supplied most of its deficiencies. It was thoroughly trained, obedient, and settled in its party doctrines. And while the new administration thus profited by the experience of its adversity, it was still more happy in the inheritance it received from its predecessor. Whatever faults the Federalists may have committed, and no one now disputes that their faults and blunders were many, they had at least the merit of success; their processes may have been clumsy, their tempers were under decidedly too little control, and their philosophy of government was both defective and inconsistent; but it is an indisputable fact, for which they have a right to receive full credit, that when they surrendered the government to Mr. Jefferson in March, 1801, they surrendered it in excellent condition. The ground was clear for Mr. Jefferson to build upon. Friendly relations had been restored with France without offending England; for the first time since the government existed there was not a serious difficulty in all our foreign relations, the chronic question of impressment alone excepted; the army and navy were already reduced to the lowest possible point; the civil service had never been increased beyond very humble proportions; the debt, it is true, had been somewhat increased, but in nothing like proportion to the increase of population and wealth; and through all their troubles the Federalists had so carefully managed taxation that there was absolutely nothing for Mr. Gallatin to do, and he attempted nothing, in regard to the tariff of impost duties, which were uniformly moderate and unexceptionable, while even in regard to the excise and other internal taxes he hesitated to interfere. This almost entire absence of grievances to correct extended even to purely political legislation. The alien and sedition laws expired by limitation before the accession of Mr. Jefferson, and only the new organization of the judiciary offered material for legislative attack. Add to all this that Europe was again about to recover peace.

On the other hand, the difficulties with which Mr. Jefferson had to deal were no greater than always must exist under any condition of party politics. From the Federalists he had nothing to fear; they were divided and helpless. The prejudices and discords of his own followers were his only real danger, and principally the pressure for office which threatened to blind the party to the higher importance of its principles. In proportion as he could maintain some efficient barrier against this and similar excesses and fix the attention of his followers on points of high policy, his Administration could rise to the level of purity which was undoubtedly his ideal. What influence was exerted by Mr. Gallatin in this respect will be shown in the course of the narrative.

The assertion that Jefferson, Madison, and Gallatin were a triumvirate which governed the country during eight years takes no account of the other members of Mr. Jefferson’s Cabinet, but in point of fact the other members added little to its strength. The War Department was given to General Dearborn, while Levi Lincoln became Attorney-General; both were from Massachusetts, men of good character and fair though not pre-eminent abilities. Mr. Gallatin described them very correctly in a letter written at the time:

GALLATIN TO MARIA NICHOLSON.

City of Washington, 12th March, 1801.

My dear Sister,—I think I am going to reform; for I feel a kind of shame at having left your friendly letters so long unanswered. How it happens that I often have and still now do apparently neglect, at least in the epistolary way, those persons who are dearest to me, must be unaccountable to you. I think it is owing to an indulgence of indolent habits and to want of regularity in the distribution of my time. In both a thorough reformation has become necessary, and as that necessity is the result of new and arduous duties, I do not know myself, or I will succeed in accomplishing it. You will easily understand that I allude to the office to which I am to be appointed. This has been decided for some time, and has been the cause of my remaining here a few days longer than I expected or wished. To-morrow morning I leave this place, and expect to return about the first day of May with my wife and family. Poor Hannah has been and is so forlorn during my absence, and she meets with so many difficulties in that western country, for which she is not fit and which is not fit for her, that I will at least feel no reluctance in leaving it. Yet were my wishes alone to be consulted I would have preferred my former plan with all its difficulties, that of studying law and removing to New York. As a political situation the place of Secretary of the Treasury is doubtless more eligible and congenial to my habits, but it is more laborious and responsible than any other, and the same industry which will be necessary to fulfil its duties, applied to another object, would at the end of two years have left me in the possession of a profession which I might have exercised either in Philadelphia or New York. But our plans are all liable to uncertainty, and I must now cheerfully undertake that which had never been the object of my ambition or wishes, though Hannah had always said that it should be offered to me in case of a change of Administration.

... As to our new Administration, the appearances are favorable, but storms must be expected. The party out of power had it so long, loved it so well, struggled so hard to the very last to preserve it, that it cannot be expected that the leaders will rest contented after their defeat. They mean to rally and to improve every opportunity which our errors, our faults, or events not under our control may afford them. As to ourselves, Mr. Jefferson’s and Mr. Madison’s characters are well known to you. General Dearborn is a man of strong sense, great practical information on all the subjects connected with his Department, and what is called a man of business. He is not, I believe, a scholar, but I think he will make the best Secretary of War we [have] as yet had. Mr. Lincoln is a good lawyer, a fine scholar, a man of great discretion and sound judgment, and of the mildest and most amiable manners. He has never, I should think from his manners, been out of his own State or mixed much with the world except on business. Both are men of 1776, sound and decided Republicans; both are men of the strictest integrity; and both, but Mr. L. principally, have a great weight of character to the Eastward with both parties. We have as yet no Secretary of the Navy, nor do I know on whom the choice of the President may fall, if S. Smith shall persist in refusing....

The Navy Department in a manner went begging. General Smith was strongly pressed to take it, and did in fact perform its duties for several weeks. Had he consented to accept the post he would have added to the weight of the government, for General Smith was a man of force and ability; but he persisted in refusing, and ultimately his brother, Robert Smith, was appointed, an amiable and respectable person, but not one of much weight except through his connections by blood or marriage.

The first act of the new Cabinet was to reach a general understanding in regard to the objects of the Administration. These appear to have been two only in number: reduction of debt and reduction of taxes, and the relation to be preserved between them. On the 14th March, Mr. Gallatin wrote a letter to Mr. Jefferson, discussing the subject at some length;[51] immediately afterwards he set out for New Geneva to arrange his affairs there and to bring his wife and family to Washington. His sharp experience of repeated exclusion from office by legislative bodies made him nervous in regard to confirmation by the Senate, and Mr. Jefferson therefore postponed the appointment until after the Senate had adjourned. These fears of factious opposition were natural enough, but seem to have been unfounded. Samuel Dexter, the Secretary of the Treasury under President Adams, consented to hold over until Mr. Gallatin was ready. Mr. Stoddart, President Adams’s Secretary of the Navy, was equally courteous. If the story, told in some of Mr. Jefferson’s biographies, be true, that Mr. Marshall, while still acting as Secretary of State, was turned out of his office by Mr. Lincoln, under the orders of Mr. Jefferson, at midnight on the 3d of March,[52] it must be confessed that, so far as courtesy was concerned, the Federalists were decidedly better bred than their rivals. The new Administration was in no way hampered or impeded by the old one, and Mr. Gallatin himself was perhaps of the whole Administration the one who suffered least from Federal attacks; henceforward his enemies came principally from his own camp. This result was natural and inevitable; it came from his own character, and was a simple consequence of his principles; but, since this internal dissension forced itself at once on the Administration and became to some extent its crucial test in the matter of removals from office for party reasons, the whole story may best be told here before proceeding with the higher subjects of state policy.

Among Mr. Gallatin’s papers is a sort of pamphlet in manuscript, stitched together, and headed in ornamental letters: “Citizen W. DUANE.” It is endorsed in Mr. Gallatin’s hand: “1801. Clerks in offices; given by W. Duane.” It contains a list of all the Department clerks, after the following style:

Some of Duane’s remarks are still more pointed:

The pressure for sweeping removals was very great. From the first, Mr. Gallatin set his face against them, and although apparently yielding adhesion to Mr. Jefferson’s famous New Haven letter of July 12, in which it was attempted to justify the principle and regulate the proportion of removals, he urged Mr. Jefferson to authorize the issue of a circular to collectors which would have practically made the New Haven letter a nullity. On the 25th July he sent to the President a draft of this circular:

CIRCULAR TO COLLECTORS.

The law having given to the collectors the appointment of a number of inferior officers subject to my approbation, there is on that subject on which we must act in concert, but one sentiment that I wish to communicate; it is that the door of office be no longer shut against any man merely on account of his political opinions, but that whether he shall differ or not from those avowed either by you or by myself, integrity and capacity suitable to the station be the only qualifications that shall direct our choice.

Permit me, since I have touched this topic, to add that whilst freedom of opinion and freedom of suffrage at public elections are considered by the President as imprescriptible rights which, possessing as citizens, you cannot have lost by becoming public officers, he will regard any exercise of official influence to restrain or control the same rights in others as injurious to that part of the public administration which is confided to your care, and practically destructive of the fundamental principles of a republican Constitution.

In his letter to Mr. Jefferson of the same date he said, “It is supposed that there is no danger in avowing the sentiment that even at present, so far as respects subordinate officers, talent and integrity are to be the only qualifications for office. In the second paragraph, the idea intended to be conveyed is that an electioneering collector is commonly a bad officer as it relates to his official duties (which I do sincerely believe to be true), and that the principle of a corrupting official influence is rejected by the present Administration in its own support and will not be forgiven when exercised against itself.”

Mr. Jefferson and Mr. Madison thought this declaration premature, and the circular was not issued. The time never came when they thought it had reached maturity; nevertheless Mr. Jefferson wrote back: “I approve so entirely of the two paragraphs on the participation of office and electioneering activity that on the latter subject I proposed very early to issue a proclamation, but was restrained by some particular considerations; with respect to the former, we both thought it better to be kept back till the New Haven remonstrance and answer have got into possession of the public, and then that it should go further and require an equilibrium to be first produced by exchanging one-half of their subordinates, after which talents and worth alone to be inquired into in the case of new vacancies.”

Mr. Gallatin, however, soon returned to his remonstrances:

GALLATIN TO JEFFERSON.

10th August, 1801.

... The answer to New Haven seems to have had a greater effect than had been calculated upon. The Republicans hope for a greater number of removals; the Federals also expect it. I have already received several letters from Philadelphia applying for the offices of customs, upon the ground that it is generally understood that the officers there are to be removed.

There is no doubt that the Federal leaders are making a powerful effort to rally their party on the same ground. Although some mistakes may have been made as to the proper objects both of removal and appointment, it does not appear that less than what has been done could have been done without injustice to the Republicans.

But ought much more to be done? It is so important for the permanent establishment of those republican principles of limitation of power and public economy for which we have so successfully contended, that they should rest on the broad basis of the people, and not on a fluctuating party majority, that it would be better to displease many of our political friends than to give an opportunity to the irreconcilable enemies of a free government of inducing the mass of the Federal citizens to make a common cause with them. The sooner we can stop the ferment the better, and, at all events, it is not desirable that it should affect the eastern and southern parts of the Union. I fear less from the importunity of obtaining offices than from the arts of those men whose political existence depends on that of party. Office-hunters cannot have much influence; but the other class may easily persuade the warmest of our friends that more ought to be done for them. Upon the whole, although a few more changes may be necessary, I hope there will be but a few. The number of removals is not great, but in importance they are beyond their number. The supervisors of all the violent party States embrace all the collectors. Add to that the intended change in the post-office, and you have in fact every man in office out of the seaports....

JEFFERSON TO GALLATIN.

Monticello, August 14, 1801.

... The answer to New Haven does not work harder than I expected; it gives mortal offence to the Monarchical Federalists who were mortally offended before. I do not believe it is thought unreasonable by the Republican Federalists. In one point the effect is not exactly what I expected. It has given more expectation to the sweeping Republicans than I think its terms justify; to the moderate and genuine Republicans it seems to have given perfect satisfaction. I am satisfied it was indispensably necessary in order to rally round one point all the shades of Republicanism and Federalism, exclusive of the monarchical; and I am in hopes it will do it. At any event, while we push the patience of our friends to the utmost it will bear, in order that we may gather into the same fold all the Republican Federalists possible, we must not even for this object absolutely revolt our tried friends. It would be a poor manœuvre to exchange them for new converts....

GALLATIN TO JEFFERSON.

17th August, 1801.

... You will find by the other letter that the Republicans expect a change in Philadelphia; this expectation is owing partly to the removal of the collector of New York and partly to the answer to New Haven, which, as I mentioned before, has had a greater if not a better effect than was expected.... Upon the whole ... it is much better to wait the meeting of Congress. Dallas, who was here, agrees with me. Yet it must be allowed that the warm Republicans will be displeased; it is the same in New York in regard to Rogers, who though the most capable was the most obnoxious to the zealous Republicans. Duane has been here, and I have taken an opportunity of showing the impropriety of numerous removals. He may think the reasons good, but his feelings will be at war with any argument on the subject....

With regard to Duane, he was quite right. The course of Mr. Gallatin and Mr. Dallas in resisting the sweeping removals urged by the Aurora forfeited Duane’s confidence. Perhaps Mr. Gallatin, who had yet to learn something about the depths of human nature, expected that at least Duane would give him the credit of honest intention; perhaps he thought the Aurora itself might be disregarded if the public were satisfied; possibly he foresaw all the consequences of making Duane an enemy, and accepted them; certain it is that the party schisms in Pennsylvania began here, and that in the long list of enmities which were at last to coalesce for Mr. Gallatin’s overthrow, this of Duane stands first in importance and in date.

Years, however, were to pass before the full effects of this difference showed themselves; meanwhile the removals were checked, and Duane pacified at least in some degree, but it is a curious fact that the cause which interposed the first obstacle to these wholesale removals was another party schism, of which New York was the field and Aaron Burr the victim; and in this case it appears that Mr. Gallatin favored removal rather than otherwise, while it was Mr. Jefferson who, out of distrust to Burr, maintained the Federal incumbent in office. The story is curious and interesting.

The naval officer in New York was one Rogers, said to have been a Tory of the Revolution. The candidate for his place was Matthew L. Davis, Burr’s right-hand man, and supported by Burr with all his energy. The great mass of New York Republicans, outside of the Livingston and Clinton interests, were attached to Burr and pressed Davis for office. Commodore Nicholson was hot about it. “It is rumored,” he wrote to Gallatin on the 10th August, “that Mr. Harrison in the State government and Mr. Rogers in the general one are to be continued. Should that be the determination, a petition should go on to both governments pointing out the consequences. I can with truth declare I have no doubt it will bring the Republican interest in this city (if not the State) in the minority; and as it applies to the President himself, I am of opinion that he ought to be made acquainted with it. There is no truth more confirmed in my mind of the badness of the policy than keeping their political enemies in office to trample upon us; after which, if he perseveres, I am bold to say if I live to see another election I shall think it my duty to use my interest against his re-election.” The commodore was a great admirer of Burr, but a month later the commodore himself, much against Mr. Gallatin’s wishes, applied for and obtained the post of loan-officer in New York, under a recommendation of De Witt Clinton, and his mouth was henceforth closed. The share which Mr. Gallatin took in the New York contest is shown in the following letters:

BURR TO GALLATIN.

New York, June 8, 1801.

Dear Sir,—I have seen with pain a paragraph in the Citizen of Friday respecting removals from office. Pray tell the President, notwithstanding any ebullitions of this kind, he may be confidently assured that the great mass of Republicans in this State are determined that he shall do things at his own time and in his own manner, and that they will justify his measures without inquiring into his reasons. I think you will not see any more paragraphs in the style of that referred to....

BURR TO GALLATIN.

New York, June 23, 1801.

Dear Sir,—...Strange reports are here in circulation respecting secret machinations against Davis. The arrangement having been made public by E. L., the character of Mr. D. is, in some measure, at stake on the event. He has already waived a very lucrative employment in expectation of this appointment. I am more and more confirmed in the opinion that his talents for that office are superior to those of any other person who can be thought of, and that his appointment will be the most popular. The opposition to him, if any is made, must proceed from improper motives, as no man dare openly avow an opinion hostile to the measure. This thing has, in my opinion, gone too far to be now defeated. Two men from the country, both very inferior to Mr. Davis in talents and pretensions, are spoken of as candidates,—I hope not seriously thought of. Any man from the country would be offensive,—either of these would be absurd, and Davis is too important to be trifled with.

You say nothing of the sinking fund.

Affectionately yours.

If you will show to the President what of the above relates to the naval office, you will save me the trouble of writing and him that of reading a longer letter to him on the subject.

BURR TO GALLATIN.

New York, September 8, 1801.

Dear Sir,—Mr. Davis is on his way to Monticello on the business too often talked of and too long left in suspense. I was surprised to learn from Mr. Jefferson that nothing had been said to him on this subject since a meeting had with his ministers early in May. About that period I wrote you a letter which I desired you to show him. Such requests are, however, always an appeal to discretion. The matter is now arrived at a crisis which calls for your opinion. This, I presume, you will give in unqualified terms. In the letter you may write by Davis I beg you also to inform Mr. J. of the characters of the gentlemen whose letters will be shown you, and I do entreat that there may now be a determination of some kind, for it has become a matter of too much speculation here why R. is kept in and why D. is not appointed.

Bradley will resign in the course of this month; you will have due notice. The next time you send a verbal message on business, I will thank you to commit it to writing.

God bless you!

Mr. D. has been goaded into this journey by the instances of an hundred friends, of whom I am not one. Yet I have not opposed it, and am rather gratified that he undertakes it.

GALLATIN TO JEFFERSON.

Washington, September 12, 1801.

Dear Sir,—This will be handed by M. L. Davis, of New York, the candidate for the naval office. I used my endeavors to prevent his proceeding to Monticello, but he has left New York with that intention, and is not easily diverted from his purpose. The reason he gives for his anxiety is that, immediately after the adjournment of Congress, E. Livingston and others mentioned to him that a positive arrangement was made by the Administration by which he was to be appointed to that office; that he was so perfectly confident, till some time in June, that such was the fact as to refuse advantageous proposals of a permanent establishment, and the general belief on that subject has placed him in a very awkward situation in New York.

He presses me much, on the ground of my personal knowledge both of him and of the local politics of New York, to give you my opinion in a decided manner on that subject, which to him I declined, both because in one respect it was not made up, and because my own opinion, even if decided, neither ought nor would decide yours. The propriety of removing Rogers remains with me the doubtful point; after Fish’s removal and that of others, they in New York seem to suppose that the removal of Rogers is, on account of ante-revolutionary adherence to enemies, unavoidable; the answer to New Haven appears to have left no doubt on their minds on that subject, and I apprehend that the numerous removals already made by you there, and the almost general sweep by their State government, have only increased the anxiety and expectations of a total change. In relation to Rogers himself, though he is a good officer, I would feel but little regret at his being dismissed, because he has no claim detached from having fulfilled his official duties, has made an independent fortune by that office, and, having no personal popularity, cannot lose us one friend nor make us one enemy. But I feel a great reluctance in yielding to that general spirit of persecution, which, in that State particularly, disgraces our cause and sinks us on a level with our predecessors.

Whether policy must yield to principle by going further into those removals than justice to our political friends and the public welfare seem to require, is a question on which I do not feel myself at present capable of deciding.

I have used the word “persecution,” and I think with propriety, for the council of appointments have extended their removals to almost every auctioneer, and that not being a political office the two parties ought certainly to have an equal chance in such appointments.

As to the other point, if Rogers shall be removed, I have no hesitation in saying that I do not know a man whom I would prefer to Mr. Davis for that office.

This may, however, be owing to my knowing him better than I do others who may be equally well qualified. I believe Davis to be a man of talent, particularly quickness and correctness, suited for the office, of strict integrity, untainted reputation, and pure Republican principles. Nor am I deterred from saying so far in his favor on account of any personal connection with any other individuals; because I am convinced that his political principles stand not on the frail basis of persons, but are exclusively bottomed on conviction of their truth and will ever govern his political conduct. So far as I think a prejudice against him in that respect existed, I consider myself in justice to him bound to declare as my sincere opinion. Farther I cannot go....

GALLATIN TO JEFFERSON.

Washington, 14th September, 1801.

... This is, however, only a trifling family controversy, and will not be attended with any other effect abroad except giving some temporary offence to Duane, Beckley, Israel, and some other very hot-headed but, I believe, honest Republicans. This leads me to a more important subject. Pennsylvania is, I think, fixed. Although we have there amongst our friends several office-hunters, Republicanism rests there on principle pretty generally, and it rests on the people at large, there not being in the whole State a single individual whose influence could command even now one county, or whose defection could lose us one hundred voters at an election.

It is ardently to be wished that the situation of New York was as favorable; but so much seems to depend in that State on certain individuals, the influence of a few is so great, and the majority in the city of New York, on which, unfortunately, the majority in the State actually depends (that city making one-eighth of the whole), is so artificial, that I much fear that we will eventually lose that State before next election of President.

The most favorable event would certainly be the division of every State into districts for the election of electors; with that single point and only common sense in the Administration, Republicanism would be established for one generation at least beyond controversy; but if not attainable as a general constitutional provision, I think that our friends, whilst they can, ought to introduce it immediately in New York. Davis’s visit to Monticello has led me to that conclusion by drawing my attention to that subject.

There are also two points connected with this, on which I wish the Republicans throughout the Union would make up their mind. Do they eventually mean not to support Burr as your successor, when you shall think fit to retire? Do they mean not to support him at next election for Vice-President? These are serious questions, for although with Pennsylvania and Maryland we can fear nothing so long as you will remain the object of contention with the Federalists, yet the danger would be great should any unfortunate event deprive the people of your services. Where is the man we could support with any reasonable prospect of success? Mr. Madison is the only one, and his being a Virginian would be a considerable objection. But if, without thinking of events more distant or merely contingent, we confine ourselves to the next election, which is near enough, the embarrassment is not less, for even Mr. Madison cannot on that occasion be supported with you, and it seems to me that there are but two ways: either to support Burr once more or to give only one vote for President, scattering our other votes for the other person to be voted for. If we do the first, we run, on the one hand, the risk of the Federal party making Burr President, and we seem, on the other, to give him an additional pledge of being eventually supported hereafter by the Republicans for that office. If we embrace the last party, we not only lose the Vice-President, but pave the way for the Federal successful candidate to that office to become President. All this would be remedied by the amendment of distinguishing the votes for the two offices, and by that of dividing the States into districts; but, as it is extremely uncertain whether such amendments will succeed, we must act on the ground of elections going on as heretofore. And here I see the danger, but cannot discover the remedy. It is indeed but with reluctance that I can ever think of the policy necessary to counteract intrigues and personal views, and wiser men than myself must devise the means. Yet had I felt the same diffidence, I mean total want of confidence, which during the course of last winter I discovered in a large majority of the Republicans towards Burr, I would have been wise enough never to give my consent in favor of his being supported last election as Vice-President. In this our party, those at least who never could be reconciled to having him hereafter as President, have made a capital fault, for which there was no necessity at the time, and which has produced and will produce us much embarrassment. I need not add that so far as your Administration can influence anything of that kind, it is impossible for us to act correctly unless the ultimate object is ascertained. Yet I do not believe that we can do much, for I dislike much the idea of supporting a section of Republicans in New York and mistrusting the great majority because that section is supposed to be hostile to Burr and he is considered as the leader of that majority. A great reason against such policy is that the reputed leaders of that section, I mean the Livingstons generally, and some broken remnants of the Clintonian party, who hate Burr (for Governor Clinton is out of question and will not act), are so selfish and so uninfluential that they never can obtain their great object, the State government, without the assistance of what is called Burr’s party, and will not hesitate a moment to bargain for that object with him and his friends, granting in exchange their support for anything he or they may want out of the State. I do not include in that number the Chancellor nor Mr. Armstrong, but the first is in that State only a name, and there is something which will forever prevent the last having any direct influence with the people. I said before that I was led to that train of ideas by Davis’s personal application, for, although in writing to you by him I said, as I sincerely believe it, that he never would nor could be influenced by B. or any other person to do an improper act or anything which could hurt the general Republican principle, yet it is not to be doubted that, after all that has been said on the subject, his refusal will by Burr be considered as a declaration of war. The Federals have been busy on the occasion. Tillotson also has said many things which might not have been said with equal propriety, and I do not know that there is hardly a man who meddles with politics in New York who does not believe that Davis’s rejection is owing to Burr’s recommendation....

To all this Mr. Jefferson merely replied in a letter of 18th September, written from Monticello: “Mr. Davis is now with me. He has not opened himself. When he does, I shall inform him that nothing is decided, nor can be till we get together at Washington.”

The appointment was not made. Rogers was retained in office until May 10, 1803, when he was removed and Samuel Osgood appointed in his place. Burr’s last appeal is dated March 25, 1802, after the matter had been a year in debate. It is actually pathetic:

BURR TO GALLATIN.

March 25.

Dear Sir,—...As to Davis, it is a small, very small favor to ask a determination. That “nothing is determined” is so commonplace that I should prefer any other answer to this only request which I have ever made.

I shall be abroad this evening, which I mention lest you might meditate a visit.

Yours.

These letters need no comment. Be the merits of the ultimate rupture between Jefferson and Burr what they may, the position of Mr. Gallatin is clear enough. He did not want that rupture. He had no affection for the great New York families which were the alternative to Burr; he regretted that deep-set distrust of the Vice-President which had always existed among the Virginians; his own relations with Burr and his friends were never otherwise than agreeable, and he could have no motive for expelling them from the party and driving them to desperation. On the other hand, Burr never included Mr. Gallatin in that exasperated vindictiveness of feeling which he entertained towards Mr. Jefferson himself and the southern Republicans; long afterwards, in conversation with Etienne Dumont in London, he expressed the opinion that Gallatin was the best head in the United States.[53] Yet, little as Mr. Gallatin was inclined to join in the persecution of Burr, he could not be blind to the fact that the large majority of Republicans felt no confidence in him; and time showed that this distrust was deserved. Mr. Jefferson followed quietly his own course of silent ostracism as regarded the Vice-President, and retained Rogers in office, so far as can be seen, solely to destroy Burr’s influence, in the teeth of the reflection curtly expressed by Commodore Nicholson in the concluding sentence of the letter above quoted: “I would have Mr. Jefferson reflect, before I conclude, what will be said of his conduct in displacing officers who served in our revolution, and retaining a British tory, to say the least of Rogers.” Whatever may have been Mr. Gallatin’s own wishes, further intervention on his part was neither judicious nor likely to be successful.

Under the influence of these jealousies, Burr was rapidly forced into opposition, and New York politics became more than ever chaotic. Whether the Administration ultimately derived any advantage from pulling down Burr in order to set up George Clinton and General Armstrong is a matter in regard to which the opinion of Mr. Madison in 1812 would be worth knowing. The slight personal hold which Mr. Gallatin might have retained upon New York through the agency of his old friend Edward Livingston, who had received the appointment of district attorney, was destroyed in 1803 by Livingston’s defalcation and removal to New Orleans. As these events occurred, and as they were rapidly followed by the Pennsylvania schism, in which Mr. Jefferson carefully balanced between the two parties, Mr. Gallatin, more and more disgusted at the revelations of moral depravity which forced themselves under his eyes, drew away from local and personal politics as far as he could, and became to a considerable degree isolated in regard to the two great States which he represented in the Cabinet. Disregarding, perhaps, too much the controversies which, however contemptible, necessarily involved his political influence, he devoted his attention to the loftier interests of national policy.

The summer and autumn of 1801 were consumed in mastering the details of Treasury business, in filling appointments to office, and in settling the scale of future expenditure in the different Departments. But when the time came for the preparation of the President’s message at the meeting of Congress in December, Mr. Gallatin had not yet succeeded in reaching a decision on the questions of the internal revenue and of the debt. He had the support of the Cabinet on the main point, that payment of the debt should take precedence of reduction in the taxes, but reduction in the taxes was dependent on the amount of economy that could be effected in the navy, and the Secretary of the Navy resisted with considerable tenacity the disposition to reduce expenditures.

What Mr. Gallatin would have done with the navy, had he been left to deal with it in his own way, nowhere appears. He had opposed its construction, and would not have considered it a misfortune if Congress had swept it away; but he seems never to have interfered with it, after coming into office, further than to insist that the amount required for its support should be fixed at the lowest sum deemed proper by the head of that Department. In fact, Mr. Jefferson’s Administration disappointed both friends and enemies in its management of the navy. The furious outcry which the Federalists raised against it on that account was quite unjust. Considering the persistent opposition which the Republican party had offered to the construction of the frigates, there can be no better example of the real conservatism of this Administration than the care which it took of the service, and even Mr. Gallatin, who honestly believed that the money would be better employed in reducing debt, grumbled not so much at the amount of the appropriations as at the want of good management in its expenditure. He thought that more should have been got for the money; but so far as the force was concerned, the last Administration had itself fixed the amount of reduction, and the new one only acted under that law, using the discretion given by it. That this is not a mere partisan apology is proved by the effective condition of our little navy in 1812; but the facts in regard to the subject are well known and fully stated in the histories of that branch of the service,—works in which there was no motive for political misrepresentation.[54]

Mr. Jefferson was in the habit of communicating the draft of his annual message to each head of department and requesting them to furnish him with their comments in writing. On these occasions Mr. Gallatin’s notes were always elaborate and interesting. In his remarks in November, 1801, on the first annual message he gave a rough sketch of the financial situation, and at this time it appears that he hoped to cut down the army and navy estimates to $930,000 and $670,000 respectively. His financial scheme then stood as follows:

He calculated that the annual application of $7,200,000 to the payment of interest and principal would pay off about thirty-eight millions of the debt in eight years, and, fixing this as his standard, he proposed to make the other departments content themselves with whatever they could get as the difference between $7,200,000 and the revenue estimated at $9,800,000. On these terms alone he would consent to part with the internal revenue, which produced about $650,000.

This, however, seems to have been beyond his power. Few finance ministers have ever pressed their economies with more perseverance or authority than Mr. Gallatin, but he never succeeded in carrying on the government with so much frugality as this, and the sketch seems to indicate what the Administration would have liked to do, rather than what it did. The report of the Secretary of the Treasury a month later shows that he had been obliged to modify his plan. As officially announced, it was as follows:

The problem of repealing the internal taxes was therefore not yet settled, and it is not very clear on the face of the estimates how it would be possible to effect this object. Mr. Gallatin expected to do it by economies in the military and naval establishments by which he should save the necessary $650,000. It is worth while to look forward over his administration and to see how far this expectation was justified, in order to understand precisely what his methods were.

His first step, as already noticed, was to fix the rate at which the debt should be discharged. This rate was ultimately represented by an annual appropriation of $7,300,000, which at the end of eight years, according to his first report, would pay off $32,289,000, and leave $45,592,000 of the national debt, and within the year 1817 would extinguish that debt entirely. This sum of $7,300,000 was therefore to be set aside out of the revenue as the permanent provision for paying the principal and interest of the debt.

Of the residue of income, which, without the internal taxes, was estimated at about $2,700,000, the civil expenditure was to require one million, the army and navy the remainder. But the tables of actual expenditure show a very different result:

From these figures it appears that Mr. Gallatin’s proposed economies were never realized, and that his results must have been attained by other means. The average expenditure on the navy during these ten years was $1,600,000 a year. Instead of establishments costing $2,700,000, the average annual expenditure reached $5,400,000, or precisely double the amount named. As a matter of fact, notwithstanding the frugality of Mr. Gallatin and the complaints of parsimony made by the Federalists, it is difficult to see how Mr. Jefferson’s Administration was in essentials more economical than its predecessors, and this seems to have been Mr. Gallatin’s own opinion at least so far as concerned the Navy Department. On the 18th January, 1803, he wrote a long letter to Mr. Jefferson on the navy estimates, closing with a strong remonstrance: “I cannot discover any approach towards reform in that department, and I hope that you will pardon my stating my opinion on that subject when you recollect with what zeal and perseverance I opposed for a number of years, whilst in Congress, similar loose demands for money. My opinions on that subject have been confirmed since you have called me in the Administration, and although I am sensible that in the opinion of many wise and good men my ideas of expenditure are considered as too contracted, I feel a strong confidence that on this particular point I am right.” Again, on the 20th May, 1805, he renewed his complaint: “It is proper that I should state that the War Department has assisted us in that respect [economy] much better than the Navy Department.... As I know that there was an equal wish in both departments to aid in this juncture, it must be concluded either that the War is better organized than the Navy Department, or that naval business cannot be conducted on reasonable terms. Whatever the cause may be, I dare predict that whilst that state of things continues we will have no navy nor shall progress towards having one. As a citizen of the United States it is an event that I will not deprecate, but I think it due to the credit of your Administration that, after so much has been expended on that account, you should leave an increase of, rather than an impaired fleet. On this subject, the expense of the navy greater than the object seemed to require, and a merely nominal accountability, I have, for the sake of preserving perfect harmony in your councils, however grating to my feelings, been almost uniformly silent, and I beg that you will ascribe what I now say to a sense of duty and to the grateful attachment I feel for you.”

Nevertheless, the internal duties were abolished as one of the first acts of Mr. Jefferson’s Administration, and at the same time Congress adopted Mr. Gallatin’s scheme of regulating the discharge of the public debt. The truth appears to be that the repeal of these taxes was a party necessity, and that under the pressure of that necessity both the Secretary of War and the Secretary of the Navy were induced to lower their estimates to a point at which Mr. Gallatin would consent to part with the tax. Mr. Gallatin never did officially recommend the repeal. This measure was founded on a report of John Randolph for the Committee of Ways and Means, and Mr. Randolph’s recommendation rested on letters of the War and Navy Secretaries promising an economy of $600,000 in their combined departments. These economies never could be effected. The resource which for the time carried Mr. Gallatin successfully over his difficulties was simply the fact that he had taken the precaution to estimate the revenue very low, and that there was uniformly a considerable excess in the receipts over the previous estimate; but even this good fortune was not enough to save Mr. Gallatin’s plan from failure. The war with Tripoli had already begun, and further economies in the navy were out of the question. Government attempted for two years to persevere in its scheme, but it soon became evident that, even with the increased production of the import duties, the expense of that war could not be met without recovering the income sacrificed by the repeal of the internal taxes in 1802. Accordingly an addition of 2½ per cent, was imposed on all imported articles which paid duty ad valorem. The result of the whole transaction, therefore, amounted only to a shifting of the mode of collection, or, in other words, instead of raising a million dollars from whiskey, stamps, &c., the million was raised on articles of foreign produce or manufacture. This extra tax was called the Mediterranean Fund, and was supposed to be a temporary resource for the Tripolitan war.

The final adjustment of this difficulty, therefore, took a simple shape. Mr. Gallatin obtained his fund of $7,300,000 for discharging principal and interest of the debt. This was what he afterwards called his “fundamental substantial measure,” which was intended to affirm and fix upon the government the principle of paying its debt and of thus separating itself at once from the whole class of corruptions and political theories which were considered as the accompaniment of debt and which were at that time identified with English and monarchical principles. To obtain the surplus necessary for maintaining this fund he relied at first on frugality, and, finding that circumstances offered too great a resistance in this direction, he resorted to taxation in the most economical form he could devise. In regard to mere machinery he made every effort to simplify rather than to complicate it. In his own words: “As to the forms adopted for attaining that object [payment of the debt], they are of a quite subordinate importance. Mr. Hamilton adopted those which had been introduced in England by Mr. Pitt, the apparatus of commissioners of the sinking fund, in whom were vested the redeemed portions of the debt, which I considered as entirely useless, but could not as Secretary of the Treasury attack in front, as they were viewed as a check on that officer, and because, owing to the prejudices of the time, the attempt would have been represented as impairing the plan already adopted for the payment of the debt. I only tried to simplify the forms, and this was the object of my letter [of March 31, 1802] to the Committee of Ways and Means. The injury which Mr. Pitt’s plan did was to divert the public attention from the only possible mode of paying a debt, viz., a surplus of receipts over expenditures, and to inspire the absurd belief that there was some mysterious property attached to a sinking fund which would enable a nation to pay a debt without the sine qua non condition of a surplus.... But the only injury done here by the provisions respecting the commissioners of the sinking fund, and by certain specific appropriations connected with the subject, was to render it more complex, and the accounts of the public debt less perspicuous and intelligible. Substantially they did neither good nor harm. The payments for the public debt and its redemption were not in the slightest degree affected, either one way or the other, by the existence of the commissioners of the sinking fund or by the repeal of the laws in reference to them. The laws making permanent appropriations were much more important. Even with respect to these it is obvious that they must also have become nugatory whenever the expenditure exceeded the income. Still they were undoubtedly useful by their tendency to check the public expenses.”

The letter on the management of the sinking fund, mentioned in the above extract, will be found in the American State Papers[55] by readers who care to study the details of American finance. These details have a very subordinate importance; the essential points in Mr. Gallatin’s history are the rules he caused to be adopted in regard to the payment of the debt, and the measures he took to secure revenue with which to make that payment. The rule adopted at his instance secured the ultimate extinction of the debt within the year 1817, provided he could maintain the necessary surplus revenue. The story of Mr. Gallatin’s career as Secretary of the Treasury relates henceforward principally to the means he used or wished to use in order to defend or recover this surplus, and the interest of that career rests mainly in the obstructions which he met and the defeat which he finally sustained.

Nevertheless, it would be very unjust to Mr. Gallatin to imagine that his interest in the government was limited to payment of debt or to details of financial management. He was no doubt a careful, economical, and laborious financier, and this must be understood as the special field of his duty, but he was also a man of large and active mind, and his Department was charged with interests that were by no means exclusively financial. One of these interests related to the public lands.