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Washington In New York


INTRODUCTION--A GATEWAY TO THE WEST


George Washington must have had an exceptional imagination. How else to explain his decision to lead an army of green farm boys against an army of trained professionals, and expect to win? At Trenton, after a summer of devastating loses, Washington saw a way to turn the tables with a series of unexpected maneuvers and actually win a battle—and did so. Coupled with a second victory a week later at Princeton, Washington’s ragtag army regained the upper hand. Five years later, at Yorktown, they delivered the coup de grâce.


“If you can dream it, you can do it.” Long before Walt Disney said it, George Washington lived it.

After the war, Washington resigned as Commander-in-Chief and returned to Mount Vernon, only to discover he was broke. Yes, he had 200 slaves, bur that didn't mean it was making him rich. As Adam Smith wrote about slavery in "The Wealth of Nations": "The experience of all ages and nations, I believe, demonstrates that the work done by slaves, though it appears to cost only their maintenance, is in the end the dearest of any. A person who can acquire no property, can have no other interest but to eat as much, and to labour as little as possible."

Washington began looking beyond the Allegheny Mountains to the nation’s interior as a way out of his economic predicament. He owned property there which under the current state of things was worth next to nothing. If he could somehow link up the Potomac River with the Ohio River it would open up a vast new empire for economic growth. How? With a canal. Such a canal would make Virginia the nation’s economic center, and make his land holdings—on both sides of the Alleghenies—extremely valuable.

Washington had been dreaming of just such a waterway since boyhood. Before the Revolutionary War, he secured approval from the Virginia legislature for the formation of a stock company to improve navigation on the Potomac, and to charge tolls. With Maryland on the river’s north bank, approval from that state was necessary. However, opposition from Baltimore merchants who saw their city being bypassed in favor of Alexandria, Virginia, scuttled the deal. After the war, the ex-Commander-in-Chief’s prestige was such that the objections of a few nervous Baltimore businessmen was easily overcome, and the Potomac Canal Company was chartered by Maryland and Virginia. While investment capital was scarce after the war, Washington’s name attracted enough money to get the project started.

Washington brushed up on his surveying skills and spent a good part of 1784 exploring the Allegheny Mountain range to determine the shortest and most practical route between the two rivers. The more he explored, the more he realized the enormity of the task. Above the fall line, the Potomac was a narrow, fast-moving mountain stream that would have to be opened up for 200 miles. The terrain rose so sharply that hundreds of locks would need to be built, dug out from mostly bedrock. Still, the more he looked the more he dreamed. He foresaw a centrally planned network of canals and improved rivers that would lead everywhere and bring “navigation to almost every man’s door.” Best of all, it would make Alexandria the gateway to the West. Washington had an idyllic name for his dream water highway—the River of Swans.

The River of Swans called for untold amounts of investment capital and, as more states became involved, a strong national government to regulate interstate commerce. At Mount Vernon in March 1785, Washington hosted a conference of investors and businessmen from Maryland and Virginia. Talk inevitably turned to the national government’s inability to govern effectively. All real power—the power to tax and spend—resided with the states. Under the Articles of Confederation, the states were sovereign entities, 13 independent nation-states that since the Revolution looked after their own interests, bickered and bullied one another and did absolutely nothing in the national interest. All the while the massive war debt went unaddressed; money was scarce, and the national economy was slipping into recession. If ever Washington’s canal was going to become a reality, it would require a strong national government to regulate interstate commerce, and to have the wherewithal to restore the nation’s credit and thereby free-up investment capital. Before adjourning, Virginia proposed a convention of delegates from all 13 states “to see how far a uniform system in their commercial regulations may be necessary to their common interest and their permanent harmony.”

The result was the Annapolis Convention, held in September 1786. Nothing happened because delegates from only five states actually attended. Before the convention adjourned, Alexander Hamilton proposed a convention in Philadelphia to address the heart of the matter: to “render the constitution of the federal government adequate to the exigencies of the Union.”

George Washington did not attend the Annapolis Conference nor did he plan to attend the Philadelphia Convention. He reminded friends that he was retired from public life. He was getting restless, however, and frustrated by states such as New York that were regulating commerce to their own advantage at the expense of smaller neighboring states such as New Jersey and Connecticut. It had to be stopped, if the young republic was to survive.


“We have probably had too good an opinion of human nature in forming our Confederation,” he wrote a friend. “Experience has taught us that men will not adopt and carry into execution measures the best calculated for their own good, without the intervention of a coercive power. I do not conceive we can exist long as a nation without having lodged somewhere a power which will pervade the whole Union.”

In April 1787, with the Convention a month off, Washington decided he must attend. Without him, nothing of significance would happen. The prestige of General George Washington was that crucial to future of the United States, and he knew it.

THE PHILADELPHIA CONVENTION

No rioting in the streets, no smashing of windows, no bricks thrown, no public officials being dragged from their homes to be executed in the town square. All that long hot summer of 1787 the streets outside the Philadelphia State House were remarkably quiet. Inside, a new government was taking shape. In a sense the Philadelphia Convention was a shadow government plotting in secret the overthrow of the existing order.

The existing order was the United States government under the Articles of Confederation. The Articles granted the real power--the power to tax and spend--to the states, which rendered the national government little more than a debate club.

Under this system, the states argued and bullied one another over boundary disputes, fishing rights, and the regulation of commerce, while the national government faced a myriad of problems that went unaddressed, including the Spanish blockade of the Mississippi River; British occupation of the Northwest Territory (in violation of the Paris Peace Treaty, Barbary pirates in the Mediterranean raiding American ships and making slaves of American sailors; non-payment of the massive Revolutionary War debt, and the collapse of public credit. To top it off, money was in short supply and the once-robust economy was in recession. Rome was burning, while the states, like Nero, fiddled.

There were no easy answers. It seemed every republic that governed a large territory eventually succumbed to chaos and tyranny. That was the fate of the Roman Republic. It started out as a republic, but once it expanded its territory it became difficult for the Senate to rule effectively, and a tyrant seized control. Was this the fate of the United States? Was a country that stretched from Main to the Gulf of Mexico, and inland beyond the Appalachians to the Mississippi, too large to be governed effectively except by a strong man? That had been the fear of the Founding Fathers at the time of the Revolution, so they refrained from appointing executive officers and prosecuted the war by committee.

Later, when they drew up the Articles of Confederation, they purposely spread the power among the states, granting the national government virtually no power at all, and avoided election of a chief executive officer out of fear he might make himself king. This approach seemed like the right thing to do, but by 1787 it clearly wasn’t working. The thirteen states were acting like thirteen bickering separate nations while the business of the republic was going unaddressed. A strong central government was clearly needed, but how to create such a government without creating a monarchy?

One answer was to create a government that balanced power evenly among three separate branches of government--executive, legislative and judicial. The French philosopher Montesquieu created the model in his “Spirit of Law,” published in 1748, but postulated that it could only perpetuate true liberty in a small country where everyone knew one another. Clearly, that wasn’t the case with the United States.


Enter James Madison. He had read a little-known treatise by Scottish philosopher David Hume entitled, “The Idea of a Perfect Commonwealth.” In it, Hume broke with Montesquieu by proposing that a large republic, despite its geographical and socioeconomic diversity, might turn out to be the most stable of all. “In a large government which is modeled with masterly skill,” Hume wrote, “there is compass and room enough to refine the democracy.”

In other words, if the government is set up properly, it will represent all the various factions of the nation more or less equally, so that no one faction, however large, would become too strong and overrule the others. Under such a government, majority rule had little chance of squashing the rights of the minorities, because the rights of the minorities are given equal representation with the majority. With a balance of power among the factions, no one power can dominate the others.

Hume’s idea hit home with Madison. He incorporated them in the “Virginia Plan” that became the model for the new constitution. The answer was not unity, which was impossible anyway, but countervailing interests: Federal versus state power, executive versus legislative, and judicial versus both of them; merchants versus farmers, town versus country, commercial-minded northerners versus agrarian-minded southerners. The result is not chaos, but a balancing of interests--and stability--and, most important of all, the protection of individual rights and liberty.

That, in a nutshell, is why our Federal government of checks and balances continues to defy the odds and to survive for 225 years and counting. As one of my college professors once said, the framers of the U.S. Constitution built better than they knew.

THE IMAGE AND THE MAN

George Washington’s portrait on the One Dollar Bill--the image most Americans have of our first President--is not an accurate depiction. The portrait was made when Washington was near the end of his life; his jaw line was distorted because he was without all but one tooth, and the artist for whom he sat was, shall we say, a hostile witness.

Washington and portrait artist Gilbert Stuart did not get along. The painter was in the habit of keeping his sitters amused and their faces alive by a flood of showy and outrageous talk. Washington, uneasy at remaining still and being observed from close quarters, was put off rather than amused. Stuart believed that artists were fundamentally superior to all men, including Presidents, and resented the General’s formality. He tried to liven-up the war hero.

“Now sir, you must let me forget that you are General Washington and I am Stuart, the painter,” he said.

Replied the General: “Mr. Stuart need never feel the need for forgetting who he is and who General Washington is.”

Washington sat for a number of portrait artists in his lifetime, each of whom brought more life to the General’s face than did Gilbert Stuart. Washington’s final portrait (and my favorite) was done during the last year of his life, by an artist with a very long name: Charles Balthazar Julien Fevret de Saint-Memin. The portrait depicts a man who is dignified yet human, intent yet at peace with himself. A profile, it was used for the image of Washington embossed on the silver Quarter Dollar.

As Americans, we are familiar with the image, but not with the man. Washington’s wife Martha knew him better than anyone, and she burned all their personal letters after he died. Washington kept a journal most of his life, but it is devoid of his innermost thoughts, and his many letters to friends, business associates, military personnel, and political leaders (often dictated, written and/or edited by others) divulge nothing of his deep personal feelings. Washington was not an easy man to know.

What we do know: he loved to gamble and to play the ponies. He loved military uniforms and fine clothing. He was comfortable in the company of women. He was a superb dancer. He was absolutely fearless in battle. According to Thomas Jefferson, Washington was the finest horsemen in Virginia, where being a good horsemen meant everything. He loved the spotlight, and yet was embarrassed by too much attention. While not a great speaker, he had charisma: when he spoke, people listened.

He was a good judge of character and surrounded himself with the brightest minds of his generation. He left school after the eighth grade, yet was highly competent in directing college-educated men. He loved being a Virginia planter, loved farming and the outdoors, yet had a library where he spent most of his evenings reading. He was a born leader, and while good at giving orders, he was not good at taking them. He was a good listener, was open to ideas that weren’t his own, and knew how to delegate. He demanded loyalty, and gave loyalty. He rarely smiled and had difficulty expressing his feelings. He had a terrible temper but learned to manage it and to keep it under wraps most of the time.

Washington was six-feet-two-inches tall, equally broad at shoulders and hips, had blue eyes and red hair, never wore a wig, and was physically strong and resilient. There was nothing false about him except his teeth, which he began losing after his thirtieth birthday. He was not a flatterer. Actions, not words, defined his character. Washington was what today we would call the strong, silent type. Had he been an actor, he would have been John Wayne. Had he been a football coach, he would have been Bear Bryant. George Washington embodied all that we have come to associate with the classic America hero.

This book is about the completion of the American Revolution and the critical role George Washington played in bringing it about. Americans in our early republic--most of them farmers and frontiersmen--didn’t agree on many things, but they did agree only one man could be trusted to lead them, and that was George Washington.

THE FIRST CONGRESS OF THE UNITED STATES

George Washington and the First United States Congress faced what Alexander Hamilton described as “a job for Hercules, for we must level mountains of prejudice.” The prejudices of which Hamilton was speaking took several forms. First and foremost, were the anti-Federalists who opposed the new Constitution and the new Federal government. Second, was the growing division within the new government itself, formed roughly along North-South lines: those states leaning toward free-labor versus the slave states; merchants versus farmers; town versus country; banking and liquid capital versus land-based wealth; strong central government versus states’ rights.

The First Congress met for three sessions. The first session was dominated by James Madison, who doubled as Congressional leader and Washington’s chief advisor. Beginning April 6, 1789 and ending September 30, 1789, the first session completed the work left unfinished at the Constitutional Convention, by fleshing out the federal judiciary system, drafting the Bill of Rights, and creating the executive departments of State, Treasury and War. As important, Congress rectified the biggest failure of the previous government by creating a federal revenue system with passage of the 1789 Tariff Act.

The second session was the most crucial, because it tested the unity of the new government. Beginning January 6, 1790 and concluding August 12, 1790, three issues threatened to divide the nation: (1) Hamilton’s controversial provision for resolving the war debt: the Funding and Assumption Bills; (2) the slavery debate; and (3) the Residency Bill: deciding on a permanent home for the nation’s capital.

The third session, beginning December 6, 1790 and ending March 3, 1791, dealt almost exclusively with the linchpin of Hamilton’s financial plan: the National Bank. After minor debate the Bank Bill passed Congress easily, but was nearly dealt a death-blow when, in a late move, Madison and Thomas Jefferson questioned the bank’s constitutionality. The two Virginians wrote legal briefs buttressing their opinion but it was Hamilton’s rebuttal that swayed the President to sign the bill into law. Stung by the defeat, coupled with Hamilton’s growing influence within the Washington Administration, led Jefferson and Madison to break with the president. The result led to the creation of the two-party system.

Hamilton and Madison figure prominently in the story, Madison as Washington’s chief advisor, and Hamilton as Secretary of the Treasury. Because Hamilton’s economic policies dominated the second and third session of Congress, I’ve devoted two chapters to a discussion of how Hamilton arrived at these polices, and how they worked. Jefferson, who joined Washington’s administration in its second year, as Secretary of State, plays a significant role as well. Other Founding Fathers are discussed including Robert Morris and John Jay, both executive officers under the Articles of Confederation who, despite great difficulty, managed to hold the nation together until Washington’s election; Oliver Ellsworth, creator of the federal judiciary system; and Benjamin Franklin, whose last public act was a pointed and wicked parody of the Deep South’s justification of slavery.

WASHINGTON IN NEW YORK

The idea for this book started with a trip to New York City. It was my first visit to Manhattan. I’d been reading about the Founding Fathers since visiting Monticello, and was intrigued by the idea that the Big Apple once had been the nation’s capital. What remains of the time when George Washington and Congress ruled the nation from Lower Manhattan? Quite a bit actually.

Unlike Midtown, the streets of Lower Manhattan are not wide nor arranged in a neat grid. The streets meander much as they did when New York was under Dutch rule and called New Amsterdam. Were Washington somehow to reappear today, he might be daunted by the skyscrapers but he would recognize these streets. He walked them many times.

A few buildings have survived since Washington’s day. On Broadway there is St. Paul’s Chapel where Washington worshipped. A pew bearing his name is kept roped off to this day. On a number of occasions Hamilton spoke at political rallies at St. Paul’s as well. A few blocks south of St. Paul’s is Trinity Church that dates from the seventeenth century, where Hamilton’s body is buried.

From Trinity Church, it’s a short walk down Wall Street to the New York Stock Exchange which, according to at least one historian, stands as a memorial to Hamilton. Across the street from the Stock Exchange is Federal Hall where Congress met. It’s not the original edifice but a newer building that serves as a museum and shrine. At the top of the steps is a statue of Washington commemorating his swearing in as our nation’s first president. Across the street, a few doors down, at 57 Wall Street, is the site of Hamilton’s law office and townhouse.


South of Wall Street, where Broad and Pearl Street intersect, stands the Fraunces Tavern where Washington bid farewell to his officers at the close of the Revolutionary War. On the upper floor of the Fraunces Tavern, John Jay had his office as secretary of state (and de facto head of state) prior to Washington’s presidency. A stone’s throw from Fraunces Tavern is the site of the Royal Exchange Building, where animals were sold for slaughter and where, on the second floor, the Supreme Court sat for the first time.

At the foot of Broadway is the Battery and Bowling Green Park, dating from the time of Dutch rule. Up one block, at 39 Broadway, is the site of the Macomb Mansion, that served as the second presidential “White House.” A plaque marks the location. The first White House, known as the Palace, located at 1 Cherry Street, is occupied by an abutment of the Brooklyn Bridge. There is a plaque on the abutment to commemorate the site.

There are other landmarks. At 57 Maiden Lane is a plaque marking the place where Thomas Jefferson lived and hosted a dinner party that resulted in the capital moving from New York to its eventual location on the banks of the Potomac. At 19 Maiden Lane is the site of the boardinghouse where James Madison lived. All of these sites are within easy walking distance of one another. I have tried to convey a feeling of how the city was when Washington and the First Congress called Lower Manhattan home.

I titled this book “Washington in New York” as an intended double meaning, although part of the story takes place in Philadelphia when it served as the capital.

The actual writing began as a series of emails to relatives who were not devoted readers of American history. With each email, my goal was to grab their attention in the first few words and to keep it to the last. Each email ran about 200-300 words. This unusual approach helped me clarify what was worth telling from what was not. The result, I hope, brings alive the achievements of a remarkable group of individuals who transformed a class-conscious society into a pluralistic and mostly tolerant nation that has endured down to our day.


CHAPTER 1: THE WANT OF REVENUE

A morning in March 1789, with the ground frozen hard, and the first rays of sunlight beginning to show on the eastern horizon.

At Mount Vernon, George Washington mounted one of his immaculate white horses, shrugged off the icy cold, and set off for Fredericksburg, a journey of about 40 miles. The electoral votes had yet to be counted, but Washington already knew he’d been elected president. He’d received letters from friends of the electors--an exit poll, so to speak--leaving no doubt as to the election’s result. For some time, in fact, he’d been preparing to take office, by finishing up personal business, arranging for someone to run Mount Vernon in his absence, and with writing his inaugural address. One of the most difficult things he’d had to do was to ask a friend for money to pay outstanding debts, and to pay for his trip to New York City to take office; difficult for him, because Washington was a proud man and a self-reliant man, and his beloved plantation hadn’t shown a profit since the Revolutionary War. The journey he was taking today, however, was perhaps the most difficult thing he would do prior to taking office.

Washington knew these roads well; he knew the farmlands they crossed, and he knew the people who ran the farms. Fredericksburg was the country where he was born and lived until the age of 16, when he left home to make his way in the world. On this particular morning he was riding there once again, to see his mother. She was gravely ill and not expected to live out the year. Washington was going there not because he could do anything for her; he never could do anything for her. He could never please her, and if he tried, she would never show the slightest gratitude. She was a hard woman, with a hard face that seldom smiled, a face that mirrored his own. He was going to Fredericksburg to say goodbye.

Mary Ball Washington was tall, physically strong, and demanding, traits her famous son inherited. After the death of her husband, she never married again. She made George, at age eleven, the man of the house and substitute father to his three younger brothers and one sister. According to his biographer James Thomas Flexner, George became the passion of his mother’s life, “and it was a very possessive passion. Even when he was Commander in Chief, even when he was President, she objected to his occupation, complaining violently that he was ungrateful and neglectful of his duties to her.” The first chance he got, at age sixteen, George Washington left home.

There is a letter, written in 1787, that sheds some light on their thorny relationship. It’s a letter he wrote in response to her request for money and to come and live at Mount Vernon. It was written at a bad time for George Washington. Mount Vernon was operating in the red and he had very little money. On top of that, he didn’t want her living under his roof. He wrote:

“I take the (first safe) conveyance . . . to send you 15 Guineas which believe me is all I have and which indeed ought to have been paid many days ago to another agreeable to my own assurances. I have now demands upon me for more than 500 (pounds sterling) three hundred and forty odd of which is due for the tax of 1786; and I know not where, or when I shall receive one shilling with which to pay it. In the last two years I made no Crops. In the first I was obliged to buy Corn and this year have none to sell, and my wheat is so bad I cannot neither eat it myself nor sell it to others, and Tobacco I make none. . . .”

He offered two suggestions:

“Either let your grandson Bushrod Washington . . . have the whole interest there (Ferry Farm), that its lands and Negroes, at a reasonable rent . . . (or) let him have the land during your life; and hire out the Negroes--this would ease you of all care and trouble--make your income certain--and your support ample.

With regard to her request to live at Mount Vernon he wrote:

“My House is at your service, and would press you most sincerely and most devoutly to accept it, but I am sure--and candour requires me to say--it will never answer your purposes . . . in truth it may be compared to a well resorted tavern, as scarcely any strangers who are going from north to south, or from south to north do not spend a day or two at it. This would, were you (to live here) oblige you to do 1 of 3 things, 1st to be always dressing to appear in company, 2nd to come in (disheveled) or 3rd to be as it were a prisoner in your own chamber. The first you would not like . . . the second I should not like because those who resort here are . . . strangers and people of the first distinction, and the 3rd, more than probably, would not be pleasant to either of us--nor indeed could you be retired in any room in my house, for what with the sitting up of Company, the noise and bustle of servants--and many other things you would not be able to enjoy. . . .”

If she would do as he suggested and rent her farm and slaves, and should the resulting income fall short, he promised to make amends: “I would, most cheerfully contribute more, a man, a maid, The Phaeton and two horses. . . .”

In closing, he offered some philosophical advice: “. . . happiness depends more upon the internal frame of a person’s own mind--than on the externals in the world, of the last, if you will, pursue the plan here recommended I am sure you can want nothing that is essential--the other depends wholly upon your self, for the riches of the Indies cannot purchase it.”


Now, two years later, he was coming again to see her for what will be--and surely they both knew this--the last time.


No one was there to record their conversation. If Washington had written something about their meeting in his journal, it is not known, as the journal entries for this period have been lost.

What did he say to her? Most likely that he was going to New York to be the President of the United States and didn’t know when he would return. What did she say to him? That she was proud of him, proud of his accomplishments and his selflessness and willingness to serve his country, proud that a grateful American people had once again looked to her son for deliverance? Not likely.

DE FACTO HEAD OF STATE

It was to be a day for celebrating in New York City, a time to usher in a new government, and perhaps the beginning of a new age in the history of mankind.At dawn, cannons at the Battery fired thirteen rounds, one for each state of the union. At 9 o’clock, church bells in the city’s 22 churches and one synagogue rang for five minutes. At 10 o’clock, Congressmen took their seats inside Federal Hall and prepared to count ballots. Outside, on Wall Street, a crowd gathered in anticipation of hearing the results of the first presidential election of the United States.

At 10:15, the doors of Federal Hall swung open and solemn-faced Congressmen filed out and headed for the nearest tavern. The celebrating would have to wait. Without a quorum, there would be no counting of ballots and no election results to announce.

For the record, March 4, 1789 was the day the United States Constitution went into effect. Without a quorum, and without a president--without the new government taking office--who was minding the store? Who was running the country?

That would be John Jay.

The old Confederation Congress having disbanded the previous Fall, Jay was de facto head of state until the new Federal Congress took office. Until such time as the new government had a quorum, however, Jay was still in charge. This was not received as good news by Jay. He’d had more than his fill of power, such as it was under the Articles of Confederation, and was eager to step down. Alas, March 4 came and went with Jay still functioning as head of state from his office on the second floor of the Fraunces Tavern on Broad Street. Days passed and then weeks, and still without a quorum. In fact, it would be another month before the new government actually took office.

Where were the leaders of this brave new republic? Holed up in taverns and inns up and down the east coast, trapped by sleet and rain that had washed out bridges and rendered roads too muddy for travel.

For Jay, it was yet another month of frustration under a system that for four years had kept him politically impotent. What good was having the responsibility of running the nation without the power to get things done? As Superintendent of Foreign Affairs (forerunner of Secretary of State) Jay was the face of the national government as surely as if he had been president, or king. Jay was the nation’s chief executive officer, without a chief executive’s power. The state legislatures had kept all the power for themselves, and they weren’t about to share it with the national government.

John Jay was from a prominent family of New York merchants, and a graduate of King’s College (now Columbia University). He married into one of New York’s most powerful families, the Livingstons. As Superintendent of Foreign Affairs under the Articles of Confederation Jay hoped to strengthen the national government by increasing the power of the unicameral Confederation Congress--turning it into an Americanized House of Commons--and elevating his position to that of prime minister. It hinged on having a federal revenue stream. As Jay’s friend Alexander Hamilton put it, “Power without revenue is a bubble.”

Jay was tall, reserved, severe. The same could be said of George Washington, only Jay lacked the General’s magnetism. Jay’s rare attempts at humor generally fell flat. Jay was a man comfortable sitting at the head of the table, setting the agenda, running things, a man people looked to for leadership. Among the Founder’s he was the most openly religious. He quoted and paraphrased the Bible in his speeches and political papers. He was president of the American Bible Society and he served as leader of his parish church. With Hamilton and other like-minded New Yorkers, he formed the New York Manumission Society with the goal of freeing African-American slaves in the state of New York.

Jay had not sought the office of Superintendent of Foreign Affairs. He learned of his appointment upon returning to the United States in 1784. He’d spent the previous five years in Europe as a diplomat, first in Spain, then in France, and for a short time, in England. When he returned to America, he desired little else than to be with his family and return to his law practice. Being a good patriot, and therefore being obliged to answer his nation’s call whenever it sounded, he agreed to accept the appointment on the condition that Congress moved the capital to Manhattan. Discretion being the better part of valor, perhaps Jay hoped that Congress would reconsider and rescind his appointment. What he didn’t know was that the Confederation Congress was desperately in need of someone with an impeccable reputation who would take control of the national government and make things happen.

Jay had the necessary credentials. In the past he’d served in the Continental Congress, first as a delegate, then as presiding officer, or president. Called back to New York, he helped draft that state’s constitution. In France, working in conjunction with John Adams and Benjamin Franklin, he negotiated the Paris Peace Treaty that ended the American Revolution.

Congress wasted little time in agreeing to Jay’s terms and moved the capital to New York City.

PROXIMITY TO A KING

At some point during his tenure as Superintendent of Foreign Affairs, surely Jay looked out across the vast waters of Upper New Bay and imagined Mount Vernon somewhere far off on the horizon and realized that there, on the banks of the Potomac, lay the real capital of the United States. That’s where Jay should have insisted on moving the national government; it would have made his political life so much easier. To wield the power of a prime minister he needed the power of a king behind him. In England, the prime minister worked closely with Parliament and administered the affairs of state, while the king served more as the nation’s father-figure. The prime minister’s role was political. The king’s role was symbolic. The king was the face of the nation and the traditional source of power. For all intents and purposes, in the United States, the king presided at Mount Vernon.

George Washington could have been crowned king. The support was there. During the Revolution, some of his generals and many of the soldiers serving under him wanted him to be king, but Washington wouldn’t hear of it. After the Revolution he retired to Mount Vernon content to manage his plantation and to enjoy life among tidewater society. Nonetheless, he was still perceived as something of a king, or at least royalty, and as the father of his country. His nearness to the capital would have worked miracles for Jay and the national government. Jay could have met with Washington from time to time, to seek his advice or merely to play a game of cards, it didn’t matter which. Close proximity to Mount Vernon would have given Jay the very clout he needed to get a revenue bill through Congress. That’s all he would have needed to be successful. Opposition from powerful state leaders like Patrick Henry of Virginia and George Clinton of New York would have gone unheeded.

In eighteenth century America, people took comfort in having a king. Prior to the Revolution, they clung to the illusion that the British king would intervene on their behalf whenever Parliament acted out of hand with some new tax. Whether true or not, the American people believed the king had their best interest at heart. When the Stamp Act was repealed in 1766, the widespread belief was that the King had responded to their petitions and taken action--sacked the prime minister, and ordered the repeal. When the Townsend Duties were enacted in 1767, there was some confusion as to why the king was slow in undoing Parliament’s obvious usurpation of power. When the Duties (except for tea) were finally repealed in 1770, the king was praised for setting things right. In Massachusetts in 1774, when military rule replaced popular government as punishment for the Boston Tea Party, Parliament rather than the good king was blamed. Even as late as the Fall of 1775 when the Continental Congress petitioned the king for redress of grievances, it was still hoped that he would intervene on their behalf. Thus when news arrived from London that the king had denounced the colonists as “rebels” and personally ordered the military to use force in putting down the insurrection, Americans felt betrayed and for the first time began considering independence as a very real option.

GOVERNMENT BY COMMITTEE

The men who signed the Declaration of Independence in 1776 were justifiably distrustful of kings. They equated monarchies with abuses, corruption, excessive taxation, and tyranny. Since many of them had served in state legislatures and trusted that form of governing, they refrained from making executive appointments and prosecuted the Revolution by committee. They did so with an all-volunteer army and without a consistent source of revenue. They chose George Washington as commander-in-chief, kept a close eye on him, and went looking for ways to finance the war without taxing the public.

Almost immediately, Washington was writing from the field asking for money, money to pay soldiers, buy food, clothing, blankets, tents, medical supplies, more ammunition and more guns. Congress responded by borrowing money from wealthy Americans committed to the cause and issuing IOUs, but mostly by printing money. Between 1775 and 1780, Congress issued paper money no fewer than thirty-seven times, backed by nothing more than its solemn declaration that it was legal tender. In the end, these paper issues amounted to more than $200 million, fiat money that depreciated quickly as fiat money always does. Before the war ended, Congress was forced to revalue earlier issues to a paltry 2.5 percent of face value; virtually nothing. The government also issued interest-bearing securities as a means of payment and these too dropped rapidly in value. Meanwhile, state governments requisitioned food and supplies from citizens--sometimes against their will--and paid with state securities that likewise declined in value. The only money to hold its value was silver and gold coins minted in Europe, and there were precious few of these in circulation.

By 1781, with the war ongoing and public credit in a state of near collapse, Congress appointed its first executive officer with the hope he could work a miracle. They picked a wealthy Philadelphia merchant named Robert Morris as Superintendent of the Treasury. On his own, Morris had proven very resourceful in raising money for Washington’s army. He knew all the right financial people, who to see and when to see them. Born in Scotland, he migrated to the United States with only the clothes on his back, entered business and become rich, and owned a fleet of ships.

The Morris appointment could not have come at a better time. The British Army was encamped at Yorktown where General Washington saw his chance to trap and defeat them there in one fell swoop, if he could get his army there immediately to deliver the knockout punch. His only obstacle was the lack of money. His army wouldn’t move until paid with something more substantial than yet another paper issue. Soldiers wanted payment in hard currency, in specie, in silver and gold coins. On the pledge of his personal credit, Morris borrowed from friends and from the French government and, at the last possible moment, came through with a shipment of silver half-crowns packed in dozens of wooden kegs. Paid a month’s salary in advance, the Continental Army marched to Yorktown and, with the help of the French Army and Navy, defeated the British in a stunning upset.

Morris now undertook a number of measures to restore financial stability to the fledgling republic, including the creation of the nation’s first commercial bank, the Bank of North American. Capitalization was made possible through loans from France and Holland. The thrust of Morris’s financial program, however, depended on the passage of a tariff bill. Without a revenue stream, Morris could work his magic only for so long. Passage of a bill of such consequence required amending the Articles of Confederation, which required a unanimous vote. Once debate got underway, all the old fears surfaced in a stream of accusations: Morris was making a grab for power; revenue invited abuses and corruption; where revenue flowed tyranny followed, etc. etc. Twice the measure was put to a vote, and twice the measure was defeated. After the second defeat Morris threw up his hands in frustration and resigned. A month later another savior was asked to step in--John Jay.

CAPTAIN OF THE DEBATE CLUB

At the time Jay took office in 1784, all the major players had departed from the national stage and were serving in governor’s mansions and in state houses up and down the east coast. For good reason. The states had the real power--the power to tax and spend. John Adams, Thomas Jefferson, and Benjamin Franklin were off in Europe serving as ministers. James Madison, after four years of frustration, was back in Virginia reading everything he could find on republics and how to make them work. Equally frustrated with the national government, Alexander Hamilton was practicing law in New York City. Having resigned as Superintendent of the Treasury, Robert Morris had returned to private business. Where once the most informed, most-educated, and most influential Americans had gathered, Congress was now a revolving door of political lightweights.

Disputes among the states were common place: over boundary lines, fishing rights, and most crucially, interstate commerce. States were either threatening to send in their militia to resolve a dispute with a neighboring state, or threatening to secede from the union. It seemed only a question of time before the fragile union of 13 states would dissolve and America would end up like Europe, forever at war. Patrick Henry of Virginia, George Clinton of New York, John Hancock of Massachusetts, and Samuel Chase of Maryland--all governors--spoke more like demagogues than the enlightened leaders of 1776 they once were. Whenever there was talk of giving Congress the power to tax, the states would inevitably respond with words like “monarchy,” “standing armies,” and “corruption.” Meanwhile, nothing was being done to address a host of national problems confronting the young republic: the Spanish blockade of the Mississippi River, British occupation of the Northwest Territory (in violation of the Paris Peace Treaty), Barbary pirates in the Mediterranean raiding American ships and making slaves of American sailors, the unpaid Revolutionary War debt, and the collapse of public credit. Topping it off, the once-robust economy was deep in recession.

Jay had the right can-do attitude, but all of his efforts were doomed from the start. Instead of reporting to a single person, he reported to an ever-changing cast of about three-dozen delegates. Congress often lacked a quorum to act on Jay’s proposals, and even when it had a quorum delegates often had other priorities and shelved Jay’s reports for a later date.

Under the Articles of Confederation, the only way Congress could generate revenue was by apportioning costs among the thirteen states according to the value of each state’s surveyed land, and then wait for the states to issue their portion. It was an idea that looked good on paper perhaps, but in reality didn’t work. Despite repeated requests, the states never offered up a farthing. What they did pay was lip service. They sent delegates that spoke well, made the right impression, but had to check back with their respective states before voting on anything of substance. Without revenue, Congress was little more than a debate club, with Jay as captain.

In an address given at the New York Ratifying Convention in Poughkeepsie in 1788, Jay made his case for all that was wrong with the national government under the Articles of Confederation:

“(Congress) may make war, but are not empowered to raise men or money to carry it on;

“(Congress) may make peace, but without power to see the terms of it observed;

“(Congress) may form alliances, but without ability to comply with the stipulation on their part;

“(Congress ) may enter into treaties of commerce, but without power to enforce them at home or abroad;

“(Congress) may borrow money, but without having the means of payment;

“(Congress) may partly regulate commerce, but without authority to execute their ordinances;

“(Congress) may appoint ministers and other officers of trust, but without power to try or punish them for misdemeanours;

“(Congress) may resolve, but cannot execute either with dispatch or with secrecy;

“In short, (Congress) may consult, and deliberate and recommend, and make requisitions, and they who please may regard them.

“From this new and wonderful system of government (Jay’s rare attempt at sarcasm), it has come to pass, that almost every national object of every kind, is at this day unprovided for. . . .”

In spite of his many frustrations, Jay did a remarkable job. He prepared more than one-hundred reports for Congress and wrote more than five-hundred official letters. He helped open up trade with China; he established a system of consuls in foreign ports; he negotiated with foreign representatives living in the United States; he advised Congress on admiralty cases; he drafted a law on piracy for Congress; he corresponded with diplomats abroad, with governors at home, and with ordinary citizens. On his watch, minister John Adams negotiated a series of loans with a consortium of Dutch financiers that kept the nation financially afloat until the new government took office.

Jay’s greatest contribution, however, was in keeping the peace among the thirteen states, and in keeping the nation out of foreign war.


- END -








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