Thomas Jefferson, the Apostle of Americanism

by Gilbert Chinard

In June, however, he expressed to George Mason his doubts that the "Assumption" would be finally adopted. But, far from siding with the out-and-out opponents of the measure, he thought it would be wiser to compromise, so he added, "my duties preventing me from mingling in these questions, I do not pretend to be very competent to their decision. In general, I think it necessary to give as well as take in a government like ours."[242]

As a matter of fact, it was already patent that an almost irreconcilable difference of opinion on the matter existed between Hamilton and the Virginians, and, a week later, Jefferson himself invited the Secretary of the Treasury to take dinner at his house with a few friends in order to hold an informal conference; for he thought it impossible that "reasonable men, consulting together coolly, could fail, by some mutual sacrifices of opinion to form a compromise which was to save the Union." Jefferson has related the scene in the "Anas", but a somewhat different account is given in his letter to James Monroe, written June 20, 1790, from New York, in which he outlined the compromise. He mentioned that two considerations had impelled him to discuss it; first the fact that if some funding bill were not agreed to, the credit of the United States at Amsterdam would collapse and vanish and each State be left alone to take care of itself. Although he was not enthusiastic about the means to be employed and foresaw that the United States would have difficulties in raising the necessary money by Federal taxation instead of letting the States raise it themselves, he accepted the solution with open eyes: "In the present instance, I see the necessity of yielding to cries of the creditors in certain parts of the Union; for the sake of the Union, and to save us from the greatest of all calamities, the total extinction of our credit in Europe." More than any member of the Cabinet he was aware of the imminence of this danger. On the other hand, and in order to give some satisfaction to the Southern States, it would be agreed that Congress would be transferred to Philadelphia for a period of twelve to fifteen years, and thereafter, without further declaration, to Georgetown. This was clearly a "deal", and Jefferson knew it so well that he denied that it was one. "The Pennsylvania and Virginia delegates have conducted themselves honorably, on the question of residence. Without descending to talk about bargains, they have seen that their true interests lay in not listening to the insidious propositions made, to divide and defect them, and we have seen them at times voting against their respective wishes rather than separate." Whether the word bargain had been used or not is immaterial. Gentlemen sitting around a table after the cloth has been removed and the punch bowl brought in can come to an understanding "à demi mot."[243] Nothing official had been done yet, but writing to Dumas, the financial agent at Amsterdam, Jefferson, in order to maintain the credit of the country, put his best foot forward and solemnly declared "that there is not one single individual in the United States, whether in or out of office, who supposes they can ever do anything which might impair their foreign contracts." With respect to domestic paper, Dumas could rest assured that "justice would be done" and, although the question was terribly complicated, it was "possible that modifications may be proposed which may bring the measure, yet into an acceptable form."[244]

With Gilmer, he was more frank and indicated clearly that among the possible ways in which the conflict in Congress might yet terminate, the best probably would be "a bargain between the eastern members who have it so much at heart, and the Middle members who are indifferent about it, to adopt these debts without modification, on condition of removing the seat of government to Philadelphia or Baltimore." The third solution, which Jefferson preferred, would have proposed to divide the total sum between all the States in proportion to their census, and to establish the national capital first and temporarily at Philadelphia, then, and permanently at Georgetown.[245] This was not an ideal solution; it was a compromise which would at least present the advantage of giving new life to the agriculture and commerce of the South. The main objection, however, still remained, for the Federal Government would have to raise the imposts and overburden that source of revenue, but it seemed that "some sacrifice was necessary for the sake of peace."[246] Once again, but not for the last time, Jefferson saw himself in a dilemma. He was too far-sighted not to understand that the individual States would have to abandon some of their rights and a portion of their sovereignty in order to acquire more financial stability, and that more power would be concentrated in the hands of the Federal Government. On the other hand, he was no less firmly convinced that a secession would unavoidably result from a rejection of the "Assumption", and he was ready to sacrifice his most cherished preferences on the altar of the Union.

On August 14, Jefferson could announce to Randolph that Congress had separated

the day before yesterday, having reacquired the harmony which always distinguished their proceedings before the two disagreeable questions of assumption and residence were introduced.... It is not foreseen that anything so generative of dissention can arise again, and therefore the friends of the government hope that this difficulty once surmounted in the States, everything will work well. I am principally afraid that commerce will be over loaded by the assumption, believing that it would be better that property should be duly taxed.

He discussed for the first time the exact ways and means in a letter to Gouverneur Morris on November 26, 1790, and indicated that additional funds would be provided by a tax on spirituous liquors, foreign and homemade, that the whole interest would be raised by taxes on consumption.... "Add to this what may be done by throwing in the aid of western lands and other articles as a sinking fund, and our prospect is really a bright one."[247]

It is perfectly true that the letter to Morris was to a great extent for publicity purposes, yet we do not find in it the slightest mark of disapproval of the tax itself, nor do we find it in a letter written to De Moustier[248] in which, on the contrary, Jefferson mentioned the advantages of duties on consumption, which fall principally on the rich; for it is "a general desire to make them contribute the whole money we want, if possible." It was not until February that doubts began to percolate into his mind, and he inquired from Colonel Mason "what was said in our country (Virginia), of the fiscal arrangements now going on." But he did not yet take the question really to heart:

Whether these measures be right or wrong abstractedly, more attention should be paid to the general opinion. However, all will pass,—the excise will pass—the bank will pass. The only corrective of what is corrupt in our present form of government will be the augmentation of the numbers in the lower House, so as to get more agricultural representation, which may put that interest above that of the stock-jobbers.[249]

This is the first indication of a rift between Jefferson and Hamilton.

Yet Jefferson was willing to yield more ground in order to avoid an open break. The Bank Bill of Hamilton had passed the Senate without difficulty; in the House it had been opposed on constitutional grounds by Madison but had finally obtained a majority. When the bill was sent to the President, Washington, unwilling to do anything unconstitutional, asked both the Attorney-general Randolph and Jefferson to give their opinion on the matter in writing. The report written on this occasion by the Secretary of State is a psychological document both interesting and revealing.