4782. LOANS, Instructions respecting.—
I would take the liberty of suggesting the
insertion of some such clause as the following
into the instructions: “The agents to be employed
shall never open a loan for more than
one million of dollars at a time, nor open a
new loan till the preceding one has been filled,
and expressly approved by the President of
the United States.” A new man, alighting
on the exchange of Amsterdam, with powers
to borrow twelve millions of dollars, will be
immediately beset with bankers and brokers,
who will pour into his ear, from the most
unsuspected quarters, such informations and
suspicions as may lead him exactly into their
snares. So wonderfully dexterous are they
in wrapping up and complicating their propositions,
that they will make it evident, even to
a clear-headed man (not in the habit of this
business), that two and two make five. The
agent, therefore, should be guarded, even
against himself, by putting it out of his power
to extend the effect of any erroneous calculation
beyond one million of dollars. Were he
able, under a delusive calculation, to commit
such a sum as twelve millions of dollars, what
would be said of the government? Our
bankers told me themselves that they would
not choose, in the conduct of this great loan,
to open for more than two or three millions
of florins at a time, and certainly never for
more than five. By contracting for only one
million of dollars at a time, the agent will
have frequent occasions of trying to better
the terms. I dare say that this caution,
though not expressed in the instructions, is
intended by the Secretary of the Treasury to
be carried into their execution. But, perhaps,
it will be desirable for the President, that his
sense of it also should be expressed in writing.—
Opinion on Foreign Debt. Washington ed. vii, 507.
Ford ed., v, 233.
(1790)
