The exceptions to the newly-established discipline were chiefly found among the war leaders themselves, who had done most to make it necessary. As the demands of the government became greater, they interfered with favorite interests or prejudices. This was particularly the case with the required financial measures. Gallatin made in his annual report no direct recommendations; he contented himself with a brief statement of receipts and estimates; but in a letter to the Committee of Ways and Means, dated November 18, he suggested a resource which might to the extent of a few millions relieve the Treasury from its immediate burden. The resource was accidental. Immediately after the repeal of the British Orders in Council, British merchandise to a great amount was shipped to America in reliance on the Act of Congress of March 2, 1811, which declared that the repeal of the British Orders, at any time, should of itself put an end to the American non-importation. The declaration of war, five days before the British repeal, rendered inoperative the Act of March 2, 1811, so that the importers became liable not only to capture by the public and private armed vessels of both countries, but also to confiscation of their property by the government on its arrival in the United States. Both events occurred. Some vessels were captured at sea, and sent in; but these and all the rest were alike seized on their arrival, and libelled by the government without distinction. The question then arose, what should be done with them.
Under the law of forfeiture, one half was vested in the custom-house officers or informers, the other half in the United States; and the power to remit, in whole or in part, was vested in the Secretary of the Treasury. No one expected the government to exact the full forfeiture, for the importations had been made in good faith, and the property was chiefly American. As though to protect the owners the courts interfered, and in certain districts compelled the collectors to release the cargoes on receiving bonds to their appraised value. The action of the courts obliged the President to make the rule general. All the cargoes were released, the goods passed into the market, and only bonds to the amount of near eighteen million dollars, besides duties to the amount of five millions, remained in charge of the Treasury. The five millions were safe; but the bonds were by no means as good as the gold.
Gallatin expressed to the Committee of Ways and Means the opinion, that in view of the extraordinary profits of the importers, who had no right to any profit at all, substantial justice would be done by remitting that half of the forfeitures which would otherwise fall to the collectors, and by exacting for the public only an equivalent for unexpected war profits. His plan aimed at placing the importers, as nearly as possible, in the condition they had expected, on the withdrawal of the non-importation, when they ordered the importations to be made.[377]
Gallatin’s views were explained more fully in the course of the debate. The importers had been aware of their risk, and had not taken it without much hesitation, after consulting Jonathan Russell, then in charge of the legation at London. The Government held non-importation to be more effective than armies or fleets in bringing England to terms, and the non-importation was still in force as a war measure. Gallatin’s orders, which admitted these goods for sale, violated the law and the policy of government; but if the goods had been admitted, as was the case, at least they should not be used to diminish the government’s receipts from internal taxation. The duties already levied to the amount of five million dollars did not exceed twenty-five per cent on their cost, while the goods themselves commanded war prices, and no other goods of the same kind were allowed to enter the country. The profits could hardly fail to be great, and no small part of these profits, besides the invested capital, was British. Finally, within the wider questions of equity, law, and policy remained the fact that bankruptcy in one form or another stood directly before the Treasury, and that four or five million dollars might be the means of national salvation.
If objections were to be made, one might have supposed that Cheves, Clay, and Calhoun would have resisted Gallatin’s idea because it offered too much encouragement to mercantile speculation resting on violation of law; but nothing was more uncertain than the moral sensitiveness of a political body. What seemed to one statesman a right and proper act seemed evident dishonesty to another; nor had the science of ethics made sensible progress toward the invention of practical tests. Statesmen who saw nothing improper in the seizure of West Florida, the attacks on East Florida, or the campaign of Tippecanoe; who maintained the doctrine that the admission of Louisiana dissolved the Union, or that Champagny’s letters satisfied the demands of government and the Acts of Congress,—war Democrats and Federalists alike, representing the morality and the energy of the country, joined in attacking Gallatin’s plan. Langdon Cheves, chairman of the Ways and Means Committee, after reporting from the committee, November 25, a resolution to leave the subject to the Secretary of the Treasury, began a speech, December 4, by declaring that he trembled for the consequences of the measure; it would shake the party to pieces; it would make angels weep.
“I trust in God,” cried Cheves, “no man who may be thus consigned by this House to the Secretary of the Treasury to await his decision and to supplicate his clemency, will so far forget what he owes to his own true interests and to his character as a free citizen as to give an equivalent for that sum of money which may be demanded as the government’s share of the profits. I would rather see the objects of the war fail,—I would rather see the seamen of the country impressed on the ocean and our commerce swept from its bosom,—than see the long arm of the Treasury indirectly thrust into the pocket of the citizen through the medium of a penal law.”
Henry Clay admitted and favored total confiscation, but not the idea of a compromise:—
“The law ought to be enforced or not. He thought a compromise in the case dangerous and undignified; indeed, he felt shocked at the idea of an equivalent. Already are our laws too openly violated or fraudulently eluded. Shall we degrade them still further by carrying them into the market and fixing a price upon their violation? Extend the principle of an equivalent, from cases of prohibition merely, to instances of moral turpitude,—to felony and homicide,—and every gentleman will see its enormity. No, sir! Let us not pollute our hands with this welt-gild!”
Calhoun would not allow that the government could properly act at all:—
“If our merchants are innocent,” he said, “they are welcome to their good fortune; if guilty, I scorn to participate in its profits. I will never consent to make our penal code the basis of our Ways and Means, or to establish a partnership between the Treasury and the violators of the Non-importation Law.”