The report of Secretary Gallatin, sent to the House November 22, bore also a warlike character. For the past year Gallatin told a cheerful story. In spite of the non-importation, the receipts from customs and other revenue exceeded $13,500,000, while the current expenses had not reached $8,000,000. If war should be declared, the secretary asked only for an increase of fifty per cent in the duties, in order to make sure of a fixed revenue of nine million dollars; and should this increase of duty be insufficient for the purpose, the deficiency could be supplied without difficulty by a further increase of duties, by a restoration of the impost on salt, and by “a proper selection of moderate internal taxes.” With a revenue of nine million dollars secured, the Treasury could rely on loans to defray extraordinary expenses, and a few years of peace would supply the means of discharging the debt incurred.
If this was different finance from that which Gallatin had taught in other days, and by which he had risen to popularity and power, it was at least as simple as all that Gallatin did; but the simplicity of his methods, which was their chief professional merit, caused also their chief reproach. History showed the financial charlatan to be popular, not so much because he was dishonest as because he gratified an instinct for gambling as deep as the instinct of selfishness; and a common notion of a financier was that of a man whose merit lay in the discovery of new sources of wealth, or in inventing means of borrowing without repayment. Gallatin professed to do neither. He did not recommend the issue of paper money; he saw no secret hoards buried in the unsold public lands; he would listen to no tricks or devices for raising money. If money was needed he would borrow it, and would pay whatever it was worth; but he would not suggest that any device could relieve the public from taxing itself to pay whatever the public chose to spend.
“The ability and will of the United States faithfully to perform their engagements are universally known; and the terms of loans will in no shape whatever be affected by want of confidence in either. They must, however, depend not only upon the state of public credit, and on the ability to lend, but also on the existing demand for capital required for other objects. Whatever this may be, the money wanted by the public must be purchased at its market price.... The most simple and direct is also the cheapest and safest mode.”
Gallatin instanced, as an extreme case, the borrowing of forty millions at eight instead of the legal rate of six per cent, which he declared an inconsiderable difference if compared with the effects of other modes of raising money. No one whose judgment deserved respect doubted the correctness of his opinion; but Republican congressmen had for twelve years denounced the Federalist loan of 1798, when five millions had been borrowed at eight per cent, and they hardly dared face their constituents when their own Secretary of the Treasury talked of borrowing forty millions at the same exorbitant rate. Gently as Gallatin hinted at “a proper selection of moderate internal taxes,” they remembered that these internal taxes had broken the Federalist party to pieces. They were angry with Gallatin for not providing other means for the war than loans and taxes, and they regarded him as not unwilling to check and chill the military ardor of the nation.
The President’s Message, as far as it regarded foreign affairs, was referred in the House, November 11, to a select committee, the chairman of which was Peter B. Porter, with Calhoun and Grundy to support his well-known opinions. Although the nature of their report could hardly be doubted, no one seemed confident that it would be taken seriously. Macon wrote privately, November 21, to his old friend Joseph Nicholson, that he was still ignorant of the leaders’ intentions:[124]—
“At this place we are nearly all too wise or too mysterious to form hasty conclusions; it is, however, probable that there are not more than five or six opinions among us, varying from open war to repealing the present restrictive system. I have had but little communication with the knowing ones, and have in some degree guessed at the number of different opinions. I am almost certain that no plan is yet adopted by the leaders in the House.”
Within a week Macon found that a plan was made, but it seemed to come wholly from the White House. The Secretary of War appeared before the Committee of Foreign Relations and explained what the President wanted;[125] at the same time Secretary Monroe communicated to the French minister the nature of the Executive plan.[126]
“Mr. Monroe added;” wrote Serurier, November 28, “... that the situation of affairs should leave me no doubt as to his Excellency’s [the President’s] disposition; that the Government had lost every illusion as to the repeal of the Orders in Council, and was decided in adopting measures of rigor; that we might be assured it would not retreat; that ten thousand regulars were to be raised and placed at the disposition of the Executive, with a great number of volunteers; that the posts would be put in a state of defence, the navy increased, and merchants authorized to arm for the protection of their commerce; that this measure, now that our decrees were withdrawn, could strike at England alone; that the Administration in taking this resolution had perfectly seen where it led; that evidently this situation would not last three months, and would inevitably lead to a decision for which the country was prepared; that the Committee of Foreign Relations in the House of Representatives would report within a few days, and he had no doubt that these measures would pass by a great majority.”
A few days later Serurier had conversations with Monroe and Madison on the subject of the Spanish American colonies, whose independence they agreed to assist not only by moral but also by material aid. The French minister closed his despatch by adding that Congress was at the moment listening to the report of the Committee of Foreign Relations. “Mr. Monroe repeated to me that he considered war as pretty nearly decided.”
If the British minister knew less exactly what was happening behind the scenes, he still knew enough to alarm him. He reported that the Government was actively organizing its party in Congress; that different sets of members met every evening in caucus, and were instilled with the ideas of the Administration;[127] but that while the members of the Government were to all appearance still undecided themselves, it would be rash for other persons to express a decided opinion. A few days after writing in this doubtful sense, Foster was electrified by an outburst of temper from Monroe, who told him that the Government would send no new minister to England, and that it “had reason to believe Great Britain really wished for war with the United States.”[128] Monroe added that he felt some difficulty in talking openly about the views of the Government, as some of his disclosures might be regarded as menaces. The President, though less warm than the Secretary, talked not less decidedly: