If it should be said that the monies heretofore borrowed are so far put out of our power that we cannot command them before an instalment will be due, I should answer, that certainly I would rather borrow than fail in a payment; but if borrowing will secure a payment in time, the two millions of florins now borrowing are sufficient to secure it. If we cannot get this sum in time, then we cannot get an additional sum in time.
The above account might be stated in another way, which might, perhaps, be more satisfactory, to wit:
| Dr. | ||
| The trust for loans. | ||
| To nett amount of loans to June 1, 1792. 18,678,000 florins, at 99 florins to $40 | $7,545,912 | |
| Cr. | ||
| Florins | ||
| By charges on remittances to France | 10,073 1 | |
| By reimbursement to Spain | 680,000 | |
| By interest paid to foreign officers | 105,000 | |
| 795,073 1 | = $321,239 46 | |
| By principal paid to foreign officers | 191,316 90 | |
| By payments to France | 10,073,043 8 | = 4,069,918 54 |
| Livres. | ||
| By payments to St. Domingo | 4,000,000 | = 726,000 |
| By payments to St. Domingo | 3,000,000 | = 544,500 |
| By payments to Mr. Ternant [I state this by memory] | 24,000 | = 4,356 |
| Balance in hand to be carried to new debit | 1,688,581 10 | |
| $7,545,912 00 | ||
| Dr. | ||
| The trust for loans. | ||
| To balance as per contra | $1,688,581 10 | |
| To two millions of florins, new loan, when effected | 808,080 | |
| $2,496,661 10 | ||
| Cr. | ||
| By the following payments when made, to wit: | Livres. | |
| Balance due to France, to close of year 1792 ($5,345,171-$5,344,774 54) | $396 46 | |
| Instalments and interest to close of year 1793 | 3,410,000 | = 618,915 |
| Instalments and interest to close of year 1794 | 3,250,000 | = 589,875 |
| Necessary for sinking fund from July 1, 1793, to December 31, 1794 | 900,000 | |
| Balance will then be in hand to be carried to new debit | 387,474 64 | |
| $2,496,661 10 | ||
By this statement, it would seem as if all the payments to France, hitherto made and ordered, would not acquit the year 1792. So that we have never yet been clear of arrears to her.
The amount of the French debt is stated according to the convention, and the interest is calculated accordingly. Interest on the ten million loan is known to have been paid for the years 1784, 1785, and is therefore deducted. It is not known whether it was paid on the same loan for the years 1786-7-8-9, previous to the payment of December 3, 1790, or whether it was included in that payment; therefore this is not deducted. But if, in fact, it was paid before that day, it will then have lessened the debt so much, to wit, 400,000 livres a year, for four years, making 1,600,000 florins, equal to $290,400, which sum would put us in advance near half of the instalments of 1793. Note,—livres are estimated at 18⁄100 cents, proposed by the Secretary of the Treasury to the French ministry as the par of the metals, to be the rate of conversion.
This uncertainty with respect to the true state of our account with France, and the difference of the result from what has been understood, shows that the gentlemen who are to give opinions on this subject, must do it in the dark, and suggests to the President the propriety of having an exact statement of the account with France communicated to them, as the ground on which they are to give opinions. It will probably be material in that about to be given on the late application of Mr. Genet, on which the Secretary of the Treasury is preparing a report.
XXXIX.—Opinion relative to the policy of a new loan.
June 17, 1793
I cannot see my way clear in the case which the President has been pleased to ask my opinion, but by recurring to these leading questions:
Of the $7,898,999 88 borrowed, or rather of the $7,545,912, nett proceeds thereof, how much has been applied to the payment of the foreign, and purchase of the general debt?