In the papers, as communicated, Adams had substituted for the names given by the envoys—Hottinger, Bellamy, and Hauteval—the initials X. Y. Z., hence the name given at once to the incident.

Whether the French bankers really represented Talleyrand is absolutely immaterial; the result on American public opinion alone is to be considered here. According to Jefferson, the public's first reaction was one of astonishment;[355] furious indignation followed very quickly. Sprigg's resolution was naturally discarded as not appropriate; war seemed the order of the day. The last resort left to the remaining Republicans was to avoid open hostilities with the French Republic and, not being able to prevent a vote of credits for armaments, to insist that they should be granted specially for internal defense and preparation.[356] A more mature consideration of the letters convinced Jefferson that the door to negotiation was not absolutely closed.[357] But popular indignation was too strong; riotous scenes took place in the streets of Philadelphia, addresses from all parts of the country came to Adams, urging him to stand for national honor and the Federalist press fanned the flames. The few faithful Republicans grew discouraged and one by one drifted out of Philadelphia. "Giles, Clopton, Cabell, and Nicholas have gone," wrote Jefferson on April 26, "and Clay goes to-morrow. Parker has completely gone over to the war party. In this state of things they will carry what they please. One of the war party, in a fit of unguarded passion, declared sometime ago they would pass a Citizen Bill, an Alien Bill, and a Sedition Bill."[358] Madison, although urged to take up his pen "for heaven's sake and not desert the public cause altogether", remained silent in Virginia. Jefferson felt that the first and second measures were directed against his close friend Volney,[359] who had been somewhat imprudent. That the republican press would be muzzled for "the war hawks talk of septembrizing, deportation and the examples for quelling sedition set by the French executives. All the firmness of the human mind is now in a state of requisition."[360]

It is remarkable, and not the smallest achievement of Jefferson, that he kept a cool head in the midst of this turmoil. Insulted every day in the press and in public meetings, lampooned and caricatured, he had to remain silent because of his official position and could not protest to the government. No stranger political situation could be imagined than this,—a man recognized as the head of a party opposed to the government, yet next to the President in rank, without power to defend himself and to enter into polemics, ostracized, and, as he admitted himself, "insulated in every society", forced to listen to the reading of the most detestable things such as the Alien Bill, and still not indulging in bitterness. A comparison of his letters with those written by Adams and Hamilton at the same time would constitute the most extraordinary tribute to his self-mastery. He persisted in seeing some faint hope and refused to give up the ship.

First there was a possibility that when the merchants would see that actual war meant War Tax, Land Tax, and Stamp Tax, these measures would constitute sedatives to cool their ardor. The present session had already cost two hundred thousand dollars and that was only a beginning. Furthermore, there was also a possibility that, if an actual declaration of war could be prevented during the summer, the coming election would reënforce the republican party. Volney had decided to go back to France with a few other aliens who had chartered a boat, without waiting for the enactment of the Alien Bill. Many of them were much irritated, but Volney at least was "thoroughly impressed with the importance of preventing war, whether considered with reference to the interests of the two countries, of the cause of Republicanism, or of man on a broad scale."[361]

Isolated though he was in Philadelphia, from his room in the Philosophical Society of which he was president, Jefferson persisted in hoping against hope. One thing however was to be avoided at all cost. If the situation became such that the Northern States, Connecticut and Massachusetts particularly, clearly dominated the situation, it was far better to submit temporarily and endure even detestable measures than to break the Union. The beginning of the disaggregation could not be stopped; a realignment of States conducing to new secessions would finally be the result. Men must quarrel, and "seeing, therefore, that an association of men who will not quarrel with one another is a thing which never yet existed, from the greatest confederacy of nations down to a town meeting or a vestry; seeing that we must have somebody to quarrel with, I had rather keep our New England associates for that purpose, than to see our bickerings transferred to others."[362]

This was a most important declaration and shows to what length Jefferson was willing to go in order to avoid the only irremediable catastrophe. Whatever may have been his weaknesses and shortcomings, his inconsistencies and contradictions, the man who, in the hectic atmosphere of Philadelphia, was able to put aside his own interests, the interests of his party, his social and political ideals to think nationally, was indeed a great American. We may even venture to say that he was at the time the only great American in the country.

When Marshall came back from France—much to his surprise, as a war hero and as an avenger of national honor—the Republicans began to take a less pessimistic view of the situation. After all, the situation was not so desperate as they had been led to believe; Gerry had remained in Paris, and negotiations could be resumed. The show of honesty made by the envoys in Paris was most gratifying to national honor and gave the public a feeling of triumph over the corrupt practices of European diplomacy. But with the return of Marshall a new campaign broke out against Jefferson. Doctor Logan on his own initiative had gone to Europe in the interest of peace, but had gone mysteriously and without telling any one of his intentions. It was soon assumed that he had been sent on an unauthorized and unofficial but highly objectionable mission by the Jacobins "to solicit an army from France, instruct them as to their landing, etc.", and Jefferson was again accused of being the arch plotter. Nothing could be more ridiculous, for the poor doctor was simply one of those idealistic pacifists who sometimes do more harm than good, but whose intentions are not open to suspicion.

But popular passions once aroused cannot be silenced in a day and the efforts of the friends of peace were weak and inefficient. On April 14 a bill was passed on second reading by the Senate, declaring the treaties with France void and nonexistent. Adams made it known that he would refuse Gerry's request that other envoys be sent. If Congress remained in session in a city where war hysteria had reached a paroxysm, extreme measures were unavoidable. The only remedy was to adjourn as soon as possible, for "to separate Congress now, will be withdrawing the fire from under a boiling pot."[363] Congress did not separate, however, without authorizing the President to increase the navy, to expend two hundred fifty thousand dollars for fortifications, to purchase eight hundred thousand dollars' worth of arms and ammunition, to raise an army of ten thousand troops and to equip vessels to seize and bring to port any armed vessels which had attacked American vessels or might be found "hovering on the coast of the United States for the purpose of committing depredations on the vessels belonging to the citizens thereof." On July 6 were passed the famous Alien Bills, and on the fourteenth, as a sort of defiance to the principles of the French Revolution, Congress adopted the "Sedition Law", giving power to the government "to prosecute persons or to prevent the circulating or saying of any utterance against the Government of the United States, or either House of the Congress of the United States, or the President of the United States."