1812: The Navy's War (67 page)
Raising more money proved to be as intractable a problem as obtaining more men for the army. “The Congress have met in a bad temper,” Secretary Jones wrote to Madison, “grumbling at everything in order to avert the responsibility which they have incurred in refusing to provide the solid foundation for revenue and relying on loans. They have suffered the specie to go out of the country, adopted a halfway system of taxation, refused or omitted to establish in due time a national bank, and yet expect the war to be carried on with energy.”
Madison hoped a new Treasury secretary could help solve the country’s financial crisis. On September 26, just after Congress convened, the Senate approved the appointment of Philadelphia banker Alexander Dallas. He replaced George W. Campbell, the former senator from Tennessee, who was more than happy to be leaving. He had held office since February, but it seemed more like a lifetime. Trying to fund a war that Republicans voted for but would not finance wore him down. Campbell had replaced Secretary Jones, who held the position, along with his post at the Navy Department, on a temporary basis after Gallatin left.
Secretary Dallas lost no time in telling Congress what he thought about the country’s desperate financial condition. He wrote a frank letter to Congressman John W. Eppes, the Republican chairman of the House Ways and Means Committee and Thomas Jefferson’s son-in-law. Dallas told Eppes something Eppes already knew and approved of, namely, that the wealth of the nation was vast but remained “almost untouched by the hand of government.” For small-government Republicans like Eppes and Jefferson, this was to be applauded, not condemned. In fact, they believed the country’s prosperity was directly attributable to a dearth of taxation. For Dallas, however, the war, which the Republicans supported, necessitated extensive taxation to pay for it, something many Republicans found incompatible with their philosophy of government.
Dallas believed that borrowing to pay for the war had brought the country to the point of bankruptcy. “Contemplating the present state of the finances,” he wrote, “it is obvious that a deficiency in the revenue and a deprecation in the public credit exist from causes which cannot in any degree be ascribed either to the want of resources or to the want of integrity in the nation.... The most operative [causes] have been the inadequacy of our system of taxation to form a foundation for public credit; and the absence even from that system of the means which are best adapted to anticipate, collect, and distribute public revenues.”
To meet the immediate need for money, Dallas recommended raising taxes on duties, imposts, and excises, and the creation of a national bank, with capital of $50 million, 40 percent of which would come from the government and 60 percent from private sources. The bank would be authorized to loan the government up to $30 million. It would provide a circulating medium (national currency) for the country, whose commerce at the moment was threatened by lack of any adequate circulating medium as a result of the suspension of specie payment by state-chartered banks.
Eppes and many other Republicans opposed Dallas’s request for more taxes and a national bank. Jefferson and his followers in Congress, like Eppes, believed Congress should pay for the war by issuing promissory notes—that is, paper money, not backed by specie. Monroe liked the idea, but Dallas was adamantly opposed, and so was Madison.
The off-and-on debate in Congress on how to fund the war went on for weeks. No happy solution appeared. As talk continued, the financial condition of the country deteriorated. The situation was so desperate that the navy was running months behind on its bills and could not even pay its seamen on time.
To meet urgent current expenses, Congress authorized Dallas to issue $10 million in Treasury notes and borrow $3 million. But Dallas could not raise the $3 million. He estimated that nearly $41 million would be necessary to fund the war through 1815. Weeks passed while Congress debated what to do. In the end it imposed some taxes, including $6 million in direct taxes. The total in taxes was almost $14 million—far less than what was required. At the same time, Congress refused to pass the president’s national bank. After weeks of talk, it passed a bank bill so different from the one Dallas thought was needed that Madison vetoed it.
On October 8, while the president and Congress were wrestling with the problems of finance and defense, George Dallas (Alexander’s son) arrived from Ghent with the first dispatches on the state of the negotiations. They shocked the president. British demands were arrogant and so outrageous that no hope existed for ending the war. Two days later, Madison sent the dispatches to Congress, and the Republican members were as incensed as the president. They distributed the dispatches throughout the country, which brought loud condemnation everywhere, except from hard-line New England Federalists. Even Federalists in the South and West were angry at British demands. Madison thought the dispatches made it more urgent than ever for Congress to act on his requests for a larger army and a sounder fiscal policy, but Congress continued to drag its feet. By then, it was widely known that the British were likely to invade New Orleans, yet Congress remained too deeply divided to act.
Not only did Madison need money to fund the army, but he wanted a major expansion of the navy as well. Secretary Jones was not adverse to strengthening the navy, but he thought that invading Canada again was a huge mistake. He carried out the president’s orders, of course, but he thought it was wrongheaded for the United States to continue the arms race on Lake Ontario. Money was a problem, but lack of men and weapons was an even greater one. Jones warned that he would be forced to shift men and munitions from the seacoast to the lake. And even if he did, he did not believe they would be enough. He predicted the effort on the lake would “lock up all our disposable seamen, and thus free . . . [Britain’s] commerce from depredation on the ocean, his flag from further humiliation, and expose our maritime frontier to incalculable vexation and pillage in consequence of the absence of our seamen on the lakes.”
The president did not agree. He was determined to invade Canada, and he believed supremacy on Lake Ontario was necessary to do it. He ordered Commodore Chauncey to build two 94-gun battleships and an additional 44-gun heavy frigate during the winter to compete with Yeo’s 104-gun ship of the line, which had seized control of Lake Ontario in the middle of October.
Madison was more likely to get support from Congress for strengthening the navy than he was for the army. Federalists consistently supported a strong fleet. On November 16, Congress gave the president a small amount for the navy, appropriating $600,000 to build twenty 16-gun sloops of war to be added to the seventy-fours and frigates already under construction.
The emphasis on the sloops was something Jones approved of. Even so, he unexpectedly resigned on December 1. He had submitted his resignation back in April but had stayed on at the president’s request. Although it was a critical time in the war, and the country needed experienced leaders at the helm, Jones maintained that his personal finances forced him to retire. Madison was not happy with the secretary’s decision. Despite Jones’s denials, their fundamental disagreement over whether to invade Canada played a part in his resignation. And so too did the monumental annoyance Jones felt at not having funds even to pay ordinary bills such as salaries and wages at the department. Dealing with Congress had worn him down.
Madison found it difficult to replace Jones. His successor, Benjamin William Crowninshield, did not come aboard until January 16, 1815, and even he was not eager for the job. Crowninshield came from a prominent Salem merchant family. They were Republicans and had supported Jefferson’s embargo, which nearly killed their business, but they had prospered as privateers during the war. When Jones left in December, Benjamin Homans, the chief clerk of the navy, ran the department until Crowninshield arrived. Homans and the new secretary, both Massachusetts Republicans, hit it off well.
Before leaving, Jones recommended an important naval reorganization. To help relieve the administrative burden on the secretary, he proposed the creation of a board of commissioners to consist of three post captains attached to the office of the secretary and under his supervision. The commissioners would superintend the procurement of naval stores and materials and the construction, armament, equipment, and employment of vessels of war, as well as all other matters connected with the naval establishment of the United States. The secretary of the navy would continue, as before, to direct and control the country’s naval forces. On February 7, 1815, President Madison signed the legislation approving creation of the board of commissioners.
DISPATCHES FROM GHENT for the period August 19 to October 31, 1814, arrived in Washington in early December and were published. They indicated a softening of British demands when they proposed
uti possidetis
as the basis for an agreement
.
Federalists were eager to accept British terms. Many Republican congressmen thought peace was near, but Madison would never accept a treaty that conceded any American territory. So as far as the president was concerned, the dispatches offered no hope that the war would end soon.
uti possidetis
as the basis for an agreement
.
Federalists were eager to accept British terms. Many Republican congressmen thought peace was near, but Madison would never accept a treaty that conceded any American territory. So as far as the president was concerned, the dispatches offered no hope that the war would end soon.
New England Federalists were particularly upset that Madison planned to continue the war indefinitely. Grievances they had felt all during the war came to a head in the fall of 1814, when the British occupied northern Maine, tightened their blockade along the coast, burned Washington, and raided coastal towns with impunity. The Federalists were furious that while Madison had concentrated on invading Canada, he had left the coasts exposed and vulnerable. Instead of squandering money on invading Canada, they thought Madison should have spent it defending the coast and strengthening the navy. And Madison’s embargoes, they contended, had annihilated the source of New England’s prosperity, her commerce. The Federalists felt they were paying for a war they despised and that was bringing unnecessary ruin on them without any support from Washington. Extreme Federalists like Timothy Pickering wanted to secede and make a separate peace. Governor Strong of Massachusetts had gone so far as to send a representative to Nova Scotia to explore the possibility with Sir John Sherbrooke.
Pickering and Strong were in the minority, however. Most New England Federalists did not want to go so far as seceding from the Union, but they were unhappy enough to call, as they had in the past, for a convention of the New England states to articulate their grievances. Urged on by radicals all over the state, the Massachusetts legislature began the movement toward a convention in Hartford on October 1, 1814, to air their complaints and possibly to advocate a course of action. Some thought they might call for secession, others that they would simply talk and issue a meaningless statement. Speculation was rife. Madison and Secretary of War Monroe took the threat from the secessionists seriously, and they kept a close eye on developments.
On October 5, Governor Strong of Massachusetts convened a special session of the legislature for the purpose of considering what the Commonwealth should do in the face of the dire circumstances the country faced and the demonstrated inadequacy of the Madison administration to deal with it. Harrison Gray Otis became chairman of a joint committee to consider what was to be done. Gray reported in three days. He called for a New England convention to address a number of constitutional issues, particularly those related to defense.
To counteract the extreme Federalists, Massachusetts Republicans, led by former secretary of war William Eustis, met in Boston on October 19 to condemn British aggression and the Hartford Convention. Eustis called instead for unity. He pointed out that any move to separate states from the union would “inevitably” result in a civil war. He made it plain that there would be no separation of New England, or any part of it, from the United States that would not result in a bloody fight, in which the federal government would intervene on the side of Republicans. The calls for New England independence, thus, were calls for civil war. Eustis’s blunt warning was heard by more sober Federalists like Otis and Cabot and undoubtedly influenced their thinking, whether they admitted it or not. They were aware that a large number of New England citizens were Republicans; Eustis was not making an idle threat.
Madison was concerned about how far the disgruntled Federalists might go and how many people would support them. The Federalists had done well in recent elections. He had no intention of letting New England secede without a fight, and despite the recent elections, he knew that New England had a strong contingent of Republicans who would support him. All of this meant that if the Federalists pressed the issue, they were inviting disaster. Governor Strong’s notion of a separate peace was a pipe dream. Any move in that direction would ignite a tragic civil war.
Secretary of War Monroe prepared for the worst, as he had to. He was also preparing, as Madison wished, a plan to expel the British from Maine. Monroe ordered units of the army to Greenbush outside Albany and sent Colonel Thomas Jessup to Hartford to assess what was happening.
The Hartford Convention convened on December 15. Twenty-six delegates attended. They had been chosen by the legislatures of Massachusetts, Connecticut, and Rhode Island; by the New Hampshire counties of Grafton and Cheshire; and by the county of Windham in Vermont. George Cabot of Massachusetts was chosen president and Theodore Dwight of Connecticut secretary. Leaders like Otis and Cabot excluded Federalist firebrands from the meeting. Otis and Cabot did not want to secede from the Union, nor did any other delegate. They wanted to express grievances and threaten future, more radical conventions, but they also wanted to preserve the Union.
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